Dividend Income – April 2018 Update

It’s May and the weather in Vancouver is getting warmer and sunnier every day. I have been walking around in a T-shirt, without a jacket. It feels that summer is just around the corner.

Nicer weather also means that Mrs. T and I are spending more time in the garden. Mrs. T had spent some time in March planting seeds. As you can see from the pictures, we have a number of things growing in our kitchen garden already.

Can’t wait for the strawberries.

So it begins with the greenhouse.

Lots of rain in April and lots of suns the last few weeks means our lawn has been growing really fast. We have been cutting it every week or so. The best part of mowing the lawn? Getting some exercise as we have a push lawn mower.

April Dividend Income

In April we received dividends from the following companies:

  • Pure Industrial REIT (AAR.UN)
  • BCE (BCE.TO)
  • Bank of Nova Scotia (BNS.TO)
  • CIBC (CM.TO)
  • Canadian Natural Resources (CNQ.TO)
  • Dream Office REIT (D.UN)
  • Dream Global REIT (DRG.UN)
  • Dream Industrial REIT (DIR.UN)
  • Enbridge Income Trust (ENF.TO)
  • H&R REIT (HR.UN)
  • Inter Pipeline (IPL.TO)
  • KEG Income Trust (KEG.UN)
  • Coca-Cola (KO)
  • Nutrien Ltd (NTR.TO)
  • Prairiesky Royalty (PSK.TO)
  • Rogers (RCI.B)
  • RioCan (REI.UN)
  • SmartCentres REIT (SRU.UN)
  • Telus (T.TO)
  • TD (TD.TO)
  • TransCanada Corp (TRP.TO)
  • Domtar Corp (UFS.TO)
  • Vanguard Canada All Cap (VCN)
  • Vanguard All-World Ex Canada (VXC)
  • Ventas (VTR)
  • Wal-Mart (WMT)

In total, we received $1,545.42 from 26 companies in April 2018. It’s yet another all-time record! This marked the 4th straight month that we broke the all-time monthly dividend income record!

Woohoo!

The green bars in the above chart just keep going higher and higher each month. Love it!

At $25 per hour wage ($52,000 annual salary), this means we have saved ourselves close to 62 hours of work in April. That corresponds to almost 8 days worth of work, or almost 2 weeks. Crossed the $1,500 milestone felt really good. So far in 2018, we have managed to cross the $1,300, the $1,400, and the $1,500 milestones. This has been quite encouraging, considering not too long ago, back in 2015, we couldn’t even cross the allusive four-digit $1,000 milestone.

Out of the $1,545.42 dividend received, $110.27 was in USD and $1,435.15 was in CAD. April was a month that was heavy in Canadian currency.

Please note, we use a 1 to 1 currency rate approach. Therefore, we do not convert dividends received in USD to CAD. We are ignoring exchange rate to keep the math simple. This is our way to avoid fluctuations in dividend income over time due to changes in the exchange rate.

The top 5 dividend payouts in April 2018 were BCE, Bank of Nova Scotia, CIBC, Telus, and TD (not in order). Dividend payouts from these 5 companies accounted for 55.7% of our April dividend income, or $860.96.

Dividend Income Breakdown

We hold our dividend stocks in taxable accounts, RRSPs, and TFSAs. Every year, we maximize tax-advantaged accounts first before investing in taxable accounts.

For Apr 2018 dividend income, here’s the breakdown of the different accounts:

  • Taxable: $423.09 or 27.4%
  • RRSPs: $409.49 or 26.5%
  • TFSAs: $712.84 or 46.1%

Effectively, only 27.4% of our April dividend income was taxable. We constructed our taxable accounts so we only receive from stocks that pay out eligible dividend income. Since we plan to live off dividend income when we are financially independent, we want to construct our portfolio to be as tax efficient as possible. This way, we can minimize income tax during financial independence. 

Dividend Growth

Compared to April 2017, we saw a respectable YOY growth of 21.56%. Wow! This is the first time in 2018 we saw an above than 20% YOY growth! Given we had yet another record month, this shouldn’t come as a surprise. Our target is to continue having the YOY growth matrix to be above 10% for the rest of the year.

Dividend Increases

After a less than stellar month in March where we only saw 1 dividend increase announcement, we hoped we would get more dividend increase news in April. Fortunately, this was the case. In April we saw 4 dividend payout increase announcements.

  • Procter & Gamble raised its dividend by 4% or $0.7172 per share.
  • Costco raised its dividend by 14% to $0.57 per share.
  • Johnson & Johnson raised its dividend by 7.14% to $0.90 per share.
  • Unilever NV raised its dividend 8.01% to €0.3585 per share. (We own the ADR listed Unilever shares)

These announcements increased our annual dividend by roughly $40 (had to estimate the amount from UL due to currency conversion).

Dividend Stock Transactions

In April, many Canadian stocks continued to be volatile. Enbridge stock price took a big tumble after the Line 3 approval announcement. Having cash in hand, we decided to take the opportunity to add to some of our existing holdings.

  • Purchased 100 shares of Enbridge (ENB.TO)
  • Purchased 50 shares of Emera (EMA.TO)
  • Purchased 100 shares of Enbridge Income Fund (ENF.TO)

The 3 purchases increased our annual dividend by $338.96.

Since the beginning of 2018, we have managed to increase a total of $2,134.91 in our annual dividend income simply by adding new capital to buy additional dividend stocks. This amount does not include any dividend increases from organic dividend growth and growth from DRIPing additional shares.

Conclusion

With 4 months in the book for 2018, we have received a total of $5,679.13 in dividend income. This amount is already over our 2013 annual dividend income and more than half of the 2014 dividend income. It’s really cool to track our progress over the last 7 years.

Dear readers, how was your April dividend income? Have you been busy shopping for dividend growth stocks like us?

Written by Tawcan
Hi I’m Bob from Vancouver Canada, I am working toward joyful life and financial independence through frugal living, dividend investing, passive income generation, life balance, and self-improvement. This blog is my way to chronicle my journey and share my stories and thoughts along the way. Stay in touch on Facebook and Twitter. Or sign up via Newsletter