Dividend Income – Dec 2018 Update & 2018 Summary

Happy 2019 everyone! I sure hope everyone enjoyed their holidays. It’s hard to believe that 2018 is in the rear view mirror and we now have a completely new year ahead of us.

For me, my favourite part of the holidays was dancing and singing around the Christmas tree with the kids and Mrs. T before opening our presents on Christmas Eve. The kids really liked the festivities and had a hard time falling asleep that night! It was also nice to slow down and spend more time playing with the kids during the holidays. Somehow, Mrs. T and I didn’t get to watch any of the Christmas movies before Christmas (one of our traditions), so we ended up watching movies like Die Hard 1, 2, 3, and Home Alone 1 and 2 after Christmas. Do you have any Christmas traditions in your household?

Our very hyggeligt cat enjoying the holidays in front of the fireplace.

When it comes to finances, 2018 was a solid year for us. Stay tuned for a post for a more detailed breakdown with a lot of numbers!

December Dividend Income

In December we received dividends from the following companies:

  • Brookfield Renewable (BEP.UN)
  • Canadian National Railway (CNR.TO)
  • Canadian Tire (CTC.A)
  • Canadian Utilities (CU.TO)
  • Chevron (CVX)
  • Dream Office REIT (D.UN)
  • Dream Global REIT (DRG.UN)
  • Dream Industrial REIT (DIR.UN)
  • Enbridge (ENB.TO)
  • Evertz Technologies (ET.TO)
  • Fortis (FTS.TO)
  • Hydro One (H.TO)
  • High Liner Foods (HLF.TO)
  • H&R REIT (HR.UN)
  • Intact Financial (IFC.TO)
  • Intel (INTC)
  • Inter Pipeline (IPL.TO)
  • Johnson & Johnson (JNJ)
  • KEG Income Trust (KEG.UN)
  • Coca-Cola (KO)
  • Magellan Aerospace Corp (MAL.TO)
  • McDonald’s (MCD)
  • Manulife Financial (MFC)
  • Magna International (MG.TO)
  • Prairiesky Royalty (PSK.TO)
  • Qualcomm (QCOM)
  • RioCan (REI.UN)
  • Saputo (SAP.TO)
  • SmartCentres REIT (SRU.UN)
  • Suncor (SU.TO)
  • Target (TGT)
  • Unilever plc (UL)
  • Visa (V)
  • WestJet (WJA.TO)
  • Waste Management (WM)
  • Wal-Mart (WMT)
  • Exco Technologies (XTC)

In total we received pay cheques from 37 companies. The 37 pay cheques added up to $1,834.96.

BANG!

Talk about ending the year with a bang. We did just that! Not only we broke the $1,700 milestone, we broke the $1,800 milestone too! Needless to say, I’m over the top with this result.

In December we received $391.26 in USD and $1,434.70 in CAD. That’s about a 20-80 split between the two currencies. Please note, we use a 1 to 1 currency rate approach. We do not convert dividends received in USD to CAD. We are ignoring the 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 Dec 2018 came from Enbridge, Intact Financial, Manulife, Canadian Utilities, and Suncor (not in order). Dividend payout from these 5 companies accounted for $880.15.

Dividend Breakdown

As long time readers may recall, we hold our dividend stocks in taxable accounts, RRSPs, and TFSAs. Every year, we maximize tax-advantaged accounts first before investing in taxable accounts. We already transferred $6,000 to each of our TFSA on Jan 2nd to max out our 2019 TFSA contribution limits. Now I’m waiting to purchase stocks on a discount.

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

  • Taxable: $533.59
  • RRSPs: $799.97
  • TFSAs: $501.40

Dividend Growth

Compared to Dec 2017, we saw a YOY growth of 43.59%! Damn, that’s a crazy YOY number. +40%? I thought we’d be facing the law of big numbers in 2018 but I guess we avoided it. This mostly had to do with us continued investing fresh capital throughout the year. Hopefully we’ll continue to see such crazy performance in 2019.

Note: In case you’re wondering why the YOY % numbers changed for the previous months, I had realized that my YOY calculation was wrong throughout 2018. Instead of dividing by the monthly total from 2017, I was dividing by the monthly total from 2018. Calculation error, oops!

Dividend Increases

In December, we saw a number of stocks in our dividend portfolio announced dividend payout increase:

  • Bank of Montreal raised its dividend by 4% to $1.00 per share.
  • National Bank raised its dividend by 5% to $0.65 per share.
  • Laurentian Bank raised its dividend by 1.6% to $0.65 per share.
  • Enbridge raised its dividend by 10% to $0.7375 per share.
  • AT&T raised its dividend by 2% to $0.51 per share.
  • Ventas raised its dividend by 0.32% to $0.7925 per share.
  • Waste Management raised its dividend by 10% to $0.5125 per share.

All these raises have increased our forward-looking dividend income by $275.21. At 4% dividend yield, this meant we didn’t have to invest $6,880.25 of new capital. Gotta love getting a raise without doing anything! 🙂

Dividend Stock Transactions

We added some stocks throughout December, just not on Christmas Eve when all major stock indexes dropped significantly. Oh well, you can’t time the market, right?

Below are some stocks that we added to our portfolio to reduce our cost basis

  • 32 shares of Bank of Nova Scotia (BNS.TO)
  • 12 shares of Vanguard All Cap ex-Canada index ETF (VXC.TO)
  • 13 shares of Vanguard Canada All Cap index ETF (VCN.TO)
  • 20 shares of Target (TGT)

All these transactions added roughly $185 toward our annual dividend income.

Summary & 2018 Review

In 2018 we received a total of $18,734.29 in dividend income. This was an increase of 26.29% from $14,834.38 in 2017. This was the highest YOY performance since 2014. Somehow we have reversed the downward YOY growth trend! This higher-than-expected growth was definitely fueled by the large fresh capital that was invested throughout the year. In 2018 we made some tough decisions and sold a few underperformaning stocks like Corus Entertainment, Sabra Health Care REIT, ConocoPhillips, and BP. Looking back, it was definitely a good idea to cut the tie with Corus Entertainment. You could argue whether the liquidations of COP and BP was a good decision or not, but these transactions allowed us to reduce our exposure in the oil sector.

Monthly dividend Income summary
Annual YOY %.

In case you’re wondering, we made the following purchases in 2018.

  • 76 shares of Bank of Nova Scotia (BNS.TO)
  • 36 shares of National Bank (NA.TO)
  • 378 shares of Enbridge (ENB.TO)
  • 20 shares of Starbucks (SBUX)
  • 131 shares of Laurentian Bank (LB.TO)
  • 210 shares of Canadian Utilities (CU.TO)
  • 122 shares of Smart Centre REIT (SRU.UN)
  • 150 shares of Emera (EMA.TO)
  • 50 shares of BCE (BCE.TO)
  • 100 shares of Magellan Aerospace Corp (MAL.TO)
  • 50 shares of TD (TD.TO)
  • 100 shares of Enbridge Income Fund (ENF.TO)
  • 119 shares of Vanguard Global Ex-Canada (VXC.TO)
  • 63 shares of Vanguard Canada All-Cap (VCN.TO)
  • 20 shares of Target (TGT)

I think the dollar value was over $65,000? As mentioned, most of this amount was fresh capital with the minority from sales of a few stocks and dividend reinvestment.

When it comes to the $18,734.29 received for 2018. The income from the different accounts are:

  • $7,062.92 was from RRSP
  • $6,802.49 was from TFSA
  • $4,868.88 was from taxable accounts

I think we did a pretty decent job at being as tax efficient as possible in 2018. For 2019, we plan to continue doing what we’ve been doing – maximize TFSAs and RRSPs before investing in taxable accounts.

At $25 per hour salary, our dividend income in 2018 has saved us over 749 hours worth of work. That’s over 93 days or almost 19 weeks. That’s almost 40% of the 52-week working week! In 5 years, we went from an annual dividend income of slightly over $5,000 to over $18,000. We feel blessed to be on this amazing journey.

So if you are just starting out with dividend growth investing and wondering how good are these $20 or $30 dividend monthly incomes, look no further than our monthly dividend income. Just like how Rome wasn’t built in one day, it takes time to build up your dividend portfolio.

Dear readers, how was your December dividend income? What was your 2018 dividend income total?

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