Half of 2017 is in the books. Man oh man does time fly. I look forward to the first weekend of every month so that I can summarize my dividend income from the previous month. Summarizing my June dividend income, aka the third month of the quarter, is always a little more exciting since I get to include the dividends received from mutual funds. Enough talk, let’s take a look at how I performed in June compared to 2016.
This month, my wife and I received $822.87 in dividend income, a record for a non-December month! This represents an 84% increase from June 2016. These quarter end months are really starting to pack a punch, and I cannot wait to breakdown the results here shortly. As I have mentioned each month, the results are slightly skewed because this is the first year I am reporting my wife’s dividend income as well. So I’ve also started also showing my individual portfolio’s dividend growth rate. Without my wife’s income, my June dividend income still grew 36%! Not quite a record, but it sure as heck will beat the raise I am expected to get from my employer in August. Now, let’s dive into the details.
Here are some of the highlights:
- The impact of automation and increasing our 401(k) contributions per paycheck is really starting to show. Now, my wife and I contribute 10% of our wages to our 401(k) . It is difficult to see the impact of my wife’s increased contributions based on the table below, but I’ll use my mutual fund as an example. In my plan, I currently contribute exclusively to VINIX (I used to contribute to VWNAX, but switch funds to diversify. So the only increase in that funds income is via DRIP). VINIX’s June dividend increased from $11.85 in June 2016 to $46.30 this year! Think about that growth rate that I was able to realize from automating this investment and focusing on leveraging tax benefits to the fullest (Thanks Lanny for doing the research in your tax series last year). Automation will continue to play a role, especially now that we purchased a house. And I plan on writing a lot more about this and changing our strategy around significantly once the dust settles from our home purchase in August and we begin to establish a routine. So there is more to come and this impact will continue to be felt.
- Speaking of automation. Much like increasing my 401(k) contribution per paycheck, I have also increased my HSA contribution as well to receive the maximum tax benefit during the year. Our company’s plan allows you to invest all funds in your HSA over $1,000, so I selected the mutual funds VTSMX as the lucky recipient of my funds. Finally, the impact of these investments are starting to be felt and this quarter I received $7.52 in dividend income accordingly. I love this investment because of the tax benefits you receive and the fact that we are going to eventually use these funds for our future family. A great investment tool I suggest to everyone.
- Man, it has felt like I have owned shares in TGT FOREVER. It turns out, I purchased shares for the first time in the second quarter of 2016 and did not receive my first dividend until September 2016. Heck, I’ve bought TGT twice since my first investment in 2016. This is the final quarter that the comparison will show a 100% increase.
- I complain about it all the time, but the impact this month was not significant since my income was carried by mutual funds. But only 1 stock switched the month it paid a dividend in compared to last year. This year, KHC paid a dividend in the third month of the quarter compared to the first month of the quarter in 2016.
- Outside of the noted transactions above, the main driver of my increase income was related good old fashion dividend growth and dividend re-investment. Ah, the good old-fashioned power of dividend re-investment.
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Dividend increases & purchases during june
Last week, I summarized some companies that increased their dividend in June. And man did I receive a lot of dividend increases from these organizations. From this list, I owned shares in Target, Kroger, Realty Income, and my wife owns Caterpillar. Gotta love dividend increases.
In terms of purchases, I have been relatively quiet of late. However, I could not resist initiating a position in Kroger after the big tumble the company experienced in June. The purchase added $23 in forward income to my portfolio and I a was very excited to take advantage of this opportunity.
Summary
I leave this month, as I do for nearly all of them, motivated to keep on fighting and keep on pushing. My finances and my life has a lot of moving parts right now, and it has caused me to do some searching and become more creative with my finances as my future cash flow took a hit with the purchase of a house and a car. But, I am ready for the challenge and I want to continue to earn results like these. Will it be easy? No. But they always say that the most rewarding things in life are the most difficult to achieve (And I’m sure there are plenty of other sayings, quotes, and clichés that I could use here). So I just need to keep reminding myself that every extra dollar makes a huge difference and to keep on finding different ways to side hustle and increase my income. Everyone, let’s go!!
How was your month of June? What dividend increases did you receive? Did you set a new record? What stocks did you purchase this month and how much income did they add to your forward income?
-Bert