Dividend Income – Jan 2019 Update

It’s my favourite time of the month – dividend income update! The reason why I publish these monthly updates is to keep us motivated and at the same time demonstrate that it is possible to build a sizable dividend income over time.

In January we were out of town for 2 weeks. We visited Taiwan and Japan and had a great time. It was amazing to know that our money was working hard for us even though we were vacationing.

Since we were travelling with a 5-year-old and a 2-year-old, we had to tailor our travel plans to them. This meant we took a very slow pace and visited only one or two tourist attractions each day. The days of running through tourist attractions and see as many attractions as possible in a short period of time are long gone for Mrs. T and I! We ended up spending quite a bit of time on different playgrounds and parks to make sure both kids could burn off their excess energy.

Here are some pictures from the trip that I posted on Instagram. I might write a trip report later.

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View of Taipei from above the sky🇹🇼

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When in Osaka…

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Ice cream eye scream!

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When we were in Taipei, I had the chance to meet up with Matt from Financial Imagineer. We ended up talking about personal finance, investing, travelling, geoarbitrage for over 2 hours. We probably could have kept talking for hours but we had to end the meetup short because Matt had a business lunch to go to.

Jan Dividend Income

In January we received dividends from the following companies:

  • 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)
  • H&R REIT (HR.UN)
  • Inter Pipeline (IPL.TO)
  • KEG Income Trust (KEG.UN)
  • MCAN Mortgage Corp (MKP.TO)
  • 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.TO)
  • Ventas (VTR)
  • Vanguard All-World Ex Canada (VXC.TO)
  • Wal-Mart (WMT)

In total we received pay cheques from 24 companies that added up to $1,609.41. I don’t know about you, but I think that’s a pretty good way to start the new year.

Out of the $1,609.41 received, only $83.01 was in USD and the rest was in CAD. This was one of those months that we received very little dividends in USD. 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 January 2019 came from BCE, Bank of Nova Scotia, Telus, CIBC, and TD (not in order). Dividend payout from these 5 companies accounted for $931.9 or 57.9% of our Jan dividend income total.

Although the top 5 dividend payouts contributed over 50% of our January dividend income, I am not worried at all. Stocks like Bank of Nova Scotia, CIBC, and TD have been paying dividends since the late 1800s. BCE and Telus both also have a long dividend history. It is unlikely for these companies to all of a sudden suspend their dividend payments.

Dividend Breakdown

A quick reminder to new readers, 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 2019, we have already maximized our TFSA’s ($12,000) and purchased dividend paying stocks with the money. We are also forecasting a slight over-contribution to our RRSP for the 2018 tax year. Remember, you are allowed to over-contribute your RRSP up to $2,000 without a penalty.

For the Jan 2019 dividend income, here’s the breakdown of the different accounts:

  • Taxable: $482.85 or 30%
  • RRSPs: $333.69 or 20.7%
  • TFSAs: $792.87 or 49.3%

Dividend Growth

Compared to January 2018, we saw a respectable YOY growth of 20.03%. It’s a good way to start off the year and I was happy to see a YoY growth percentage that was higher than 20% (well barely).

Dividend Increases

In January, the following stocks in our dividend portfolio announced dividend payout increase:

  • Canadian Utilities raised its dividend by 7.5% to $0.4227 per share.
  • Rogers raised its dividend by 4.2% to $0.50 per share.
  • Canadian National Railway raised its dividend by 18% to $0.5375 per share.
  • Metro raised its dividend by 11.1% to $0.20 per share.
  • Exco Technologies raised its dividend by 6% to $0.09 per share.
  • Chevron raised its dividend by 6.3% to $1.19 per share.

All these raises increased our annual dividend by $77.24. At 4% dividend yield, this meant we received a free raise in our dividend income without having to invest $1,931.

Dividend Stock Transactions

We maxed out our TFSA’s at the beginning of the month and purchased a number of stocks. Unfortunately we didn’t see a big market drop like we saw on Christmas Eve, so the purchase prices were slightly above the stocks’ 52-week low.

  • 35 shares of TD (TD.TO)
  • 289 shares of Inter Pipeline (IPL.TO)
  • 44 shares of Bank of Montreal (BMO.TO)

These 3 transactions increased our forward annual dividend by $755.32.

Summary

With one month down, we have received $1,609.41 in dividend income so far this year. Looking back, it’s amazing to note that in 2018, we did not receive over $1,600 in dividend until June, or halfway through 2018. Considering that we plan to continue to add fresh capital into our dividend portfolio and purchase more dividend-paying stocks and ETFs, I am optimistic that we will break the $2,000 monthly dividend milestone sometime in 2019.

In case you’re wondering, at $1,602.09, the amount covered 66% of our core expenses in January.

How was your January dividend income?

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