Dividend Income – June 2018 Update

3.5 weeks after getting sick and having bronchitis, I am finally feeling better. The coughing is still lingering though, so hopefully that’ll go away soon. Although I have been walking a lot the last 3.5 weeks, it would be good to start some high-intensity exercises at the gym.

July is upon us and that means we are enjoying the awesome sunny weather here in Vancouver. With lots of sunshine that also means our backyard veggie garden is growing very nicely. We have been busy harvesting strawberries, raspberries, kale, etc and using them in meals and desserts.

raspberries

strawberries and various veggies

Tomatoes and cucumbers are growing nicely in the greenhouse

Blackcurrant and red currant. Almost ready for harvest.

Baby T1.0 planted some corns in the spring and they are growing nicely

Fresh raspberries from our daily harvest

Baby T1.0 made this cake himself (with a little help)

koldskål (Danish cold buttermilk dessert) with strawberries

I’m sure the veggie garden will keep us pretty busy over the next few months.

 

June Dividend Income

In June we received dividends from the following companies:

  • Brookfield Renewable (BEP.UN)
  • BP (BP)
  • Canadian National Railway (CNR.TO)
  • ConocoPhillips (COP)
  • 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)
  • Enbridge Income Trust (ENF.TO)
  • Fortis (FTS.TO)
  • Hydro One (H.TO)
  • Intel (INTC)
  • High Liner Foods (HLF.TO)
  • H&R REIT (HR.UN)
  • Intact Financial (INF.TO)
  • Inter Pipeline (IPL.TO)
  • Johnson & Johnson (JNJ)
  • KEG Income Trust (KEG.UN)
  • Magellan Aerospace Corp (MAL.TO)
  • McDonald’s (MCD)
  • Manulife Financial (MFC.TO)
  • Magna International (MG.TO)
  • MCAN Mortgage Corp (MKP.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.TO)

In total, we received $1,690.82 from 39 companies in June 2018. This is yet another all-time monthly dividend income record!!! As you can see from the chart above, there’s a nice spike for June 2018. It sure looks nice!

It’s hard to believe that for the 5th time in 2018, we broke our all-time monthly dividend income. Wow! And not to mention that we received 39 pay cheques, so our dividend income is well diversified.

We were only $9.18 short of the $1,700 milestone. Originally I had thought that Evertz Technologies would pay dividend in June, since the previous dividend payment was in Mar. As it turned out, Evertz Technologies is paying the dividend in July. If Evertz Technologies had paid dividend in June instead of July, we would have easily broken the $1,700 record. Darn it!

The big jump in June’s dividend income mostly had to do with our purchases of Enbridge shares earlier this year. We received almost $400 in dividend income from Enbridge alone in June.

Out of the $1,690.82 received, $308.01 was in USD and $1,382.81 was in CAD. Or about a 20-80 split. If you are a long time reader to our monthly dividend income reports, you will know that we use a 1 to 1 currency rate approach. 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 June 2018 were Manulife Financial, Suncor, Enbridge, Chevron, and Intact Financial (not in order). Dividend payouts from these 5 companies accounted for 45.2% of our June dividend income, or $764.32.

 

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

  • Taxable: $495.92 or 29.3%
  • RRSPs: $680.97 or 40.3%
  • TFSAs: $513.93 or 30.4%

Effectively, only 29.3% of our June 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 June 2017, we saw a respectable YOY growth of 24.92%!

That is the highest YOY number so far in 2018. I’m extremely happy and excited to see that we did so awesome in this performance matrix.

With 6 months in the book, we are averaging a YOY growth of 18.65%. In 2016, after 6 months, we had a YOY growth average of 20.52%. So clearly we are slowing down a bit when it comes to dividend YOY growth. However, as I have indicated many times before, this is a natural phenomenon for dividend growth investors as your dividend income increases.

 

Dividend Increases

So far in 2018, many dividend stocks that we own in our dividend portfolio have announced dividend payout increases.

  • Target raised its dividend by 3.23% to $0.64 per share.
  • Starbucks raised its dividend by 20% to $0.36 per share.

 

Dividend Stock Transactions

Because we had closed out a couple of positions in May, we had a higher than usual amount of cash on hand. So we paid attention to any significant price drops during June to see if we could purchase dividend paying stocks at a discount.

Lucky for us, we encountered a few opportunities to deploy the extra cash and added shares to two stocks that we already own.

  • Purchased 20 shares of Starbucks (SBUX)
  • Purchased 57 shares of Laurentian Bank (LB.TO)

After the June 19 earnings release, Starbucks’ stock price went down to nearly 20% from their recent highs. This mostly due to Starbucks gave a lower than expected growth in their guidance. On top of this bad news, Howard Schultz stepped down as executive chairman and CFO Scott Maw retired unexpectedly. However, in the earnings release, Starbucks did announce a $10B increase in their current share buyback program. This meant they are eligible to purchase up to $26B of the company’s stock. With Starbucks share price being close to the 52 week low, a buy-back program will generate some nice value and returns for shareholders.

For me, I see this price drop as a short-term pain. Starbucks appears to be growing nicely in Asia and the $8B retail distribution deal with Nestle will increase the accessibility of Starbucks products to customers. So we took a calculated risk and purchase a small amount of Starbucks shares and to cost average our cost basis.

Similarly, the price of Laurentian Bank has gone nowhere/downward since our purchase earlier this year. Since we already own quite a bit of the Big Five (and National Bank), we decided to purchase more Laurentian Bank shares to diversify our exposure in the financial sector and to cost average our cost basis.

 

Conclusion

So far in 2018, we have received a total of $8,829.71 in dividend income. It’s hard to believe with only 6 months in, we have already exceeded our 2014 dividend income total!

Mrs. T and I continue to be appreciative of our dividend income. Thanks to the dividend portfolio that we have been building over the last few years, our money is working hard for us so we don’t have to.

Gotta love that!

How was your June dividend income?

 

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48 Comments

  • Reply
    Team CF
    July 9, 2018 at 3:26 am

    haha, your chart is getting too small 🙂 Now that is a luxury problem that one should have!
    Nice month Bob, double dividend (financial and vegetable) is always good.

    • Reply
      Tawcan
      July 9, 2018 at 11:43 am

      Haha it is getting a bit too small, I should maybe start removing the earlier years. 🙂

  • Reply
    desidividend
    July 9, 2018 at 5:38 am

    very nice ,maybe you will break the 1700 record in September

    • Reply
      Tawcan
      July 9, 2018 at 11:43 am

      Thanks, Have both $1,700 and $1,800 records in mind for this year!

  • Reply
    CatfaceMeowmers
    July 9, 2018 at 5:51 am

    What a garden! In a years time I predict we’ll be reading about Tawcan’s side hustle at the farmers-market.

    Great jobs on the dividends. Maybe the only thing sweeter than the raspberries in this post.

    • Reply
      Tawcan
      July 9, 2018 at 11:44 am

      Thank you CatfaceMeowmer. We are very fortunate to have a sizable garden.

      Hmm the farmers-market side hustle sounds interesting… may need to look into that. 🙂

      • Reply
        CATFACEMEOWMERS
        July 9, 2018 at 2:15 pm

        Oh my gosh.. ‘sweater’.. it was early.. please..

        • Reply
          Tawcan
          July 9, 2018 at 3:06 pm

          Lol fixed it for you. No worries.

  • Reply
    Buy, Hold Long
    July 9, 2018 at 6:06 am

    Fantastic work. Every month is getting better and better. Love seeing the increases. Keep up the great stuff. Not long now and we will see the 2k barrier broken!

    • Reply
      Tawcan
      July 9, 2018 at 11:45 am

      Thank you Buy, Hold Long. We are indeed getting better every month. I contribute that to adding quite a bit of new capital this year already.

  • Reply
    Jordan @ MoneyMaaster.com
    July 9, 2018 at 6:38 am

    Congrats on the YoY growth, that is fantastic!

    Garden is looking great.

    • Reply
      Tawcan
      July 9, 2018 at 11:45 am

      Thank you Jordan. Very happy with the YoY growth, I surprised myself when I calculated that number.

  • Reply
    Owen @ PlanEasy.ca
    July 9, 2018 at 7:24 am

    Very impressive dividends this month! What % of your expenses does this cover now? Plus, its great to hear that you’re feeling better, especially as summer gets into full swing. Being sick in the summer is the worst!

    PS. I love the garden! I’ve got a small veggie garden but it’s growing every year.

    • Reply
      Tawcan
      July 9, 2018 at 11:46 am

      Didn’t run what % of our expenses the dividend can cover, maybe I should do that for July dividend income update. 🙂

      It’s so awesome to have a veggie garden and eating stuff that you grow yourself.

  • Reply
    MrSLM
    July 9, 2018 at 8:28 am

    Looks like you’re on track to hit $2k at some point this year, congrats!

    We have a bunch of raspberry bushes in our yard too but very few are ripe so far, not that I ever get any of them since the kids love them so much.

    • Reply
      Tawcan
      July 9, 2018 at 11:47 am

      Still have a long way before we catch you. 🙂 😉

      Both of our kids love eating raspberry too. They also love the strawberries, red currant, and black currant too. It’s nice to teach them about where food comes from at a young age.

  • Reply
    Doug
    July 9, 2018 at 8:28 am

    Good job. Knocking on the door of 1700.00 is nothing to sneeze at. Looks like you will also blow last years numbers out of the water. Keep it up.

    • Reply
      Tawcan
      July 9, 2018 at 11:48 am

      Thank you Doug. Hoping to break the $1,700 record shortly. It’s so exciting to see that we’ve been setting records 5 out of 6 months so far.

  • Reply
    Mr. Tako
    July 9, 2018 at 9:19 am

    Fantastic dividend growth Tawcan! Like I told you in person, it happens faster than you think!

    These days our dividend growth is much slower of course, but I still aim for a good mix of external and internal compounding.

    Glad your feeling better! The garden looks great!

    • Reply
      Tawcan
      July 9, 2018 at 11:49 am

      Gotta listen to the wise Mr. Tako more hehe. 🙂

      Yes finally feeling better, probably will aim to go back to the gym this week.

      It gets tougher to grow dividend once you are FIRE’d and not injecting a lot of new capital into the portfolio. But that’s another problem to have. 🙂

  • Reply
    May
    July 9, 2018 at 9:33 am

    Congrats. Fantastic growth.

    Really admire your courage. I dared not to buy ENB when it’s very low. Now it’s up so much. Not only you got more dividend, also nice capital gain. I did buy some MRU and SAP on dip though, it’s nice to see the price up.

    • Reply
      Tawcan
      July 9, 2018 at 11:51 am

      Thank you May, I really appreciate that. I was second guessing a little bit when we purchased ENB earlier this year too but I felt it was a great opportunity so I took a chance. Looks like it’s paying off, so that’s nice to know. Buying MRU and SAP on dip is a great idea. 🙂

  • Reply
    My Dividend Dynasty
    July 9, 2018 at 11:16 am

    Amazing month! A near 25% yoy increase is impressive. Congrats on breaking new records! 🙂

    • Reply
      Tawcan
      July 9, 2018 at 11:51 am

      Amazing month indeed. Thank you very much. Hope you had a great month of June too.

  • Reply
    DivvyDad
    July 9, 2018 at 12:07 pm

    Glad to hear that you’re feeling better. That garden is amazing and really makes me miss even the little garden that we used to have in our yard.

    Very impressive work to hit yet another record, and it is great to see that chart reaching the top now. Counting the divs in my retirement account allowed me to crack the $1k mark for the first time. It looks like June was good to quite a few within the DGI community!

    • Reply
      Tawcan
      July 9, 2018 at 3:06 pm

      It’s nice to finally feel better, this cold hit me hard. :S

      Cracking $1k mark for the first time is very impressive. Congrats on your new record!

  • Reply
    Mr. Groovy
    July 9, 2018 at 5:05 pm

    Very nice, Tawcan. Looking forward to the $1,700 milestone.

    • Reply
      Tawcan
      July 10, 2018 at 11:38 am

      Thank you Mr. Groovy. Hopefully will hit $1,700 milestone soon.

  • Reply
    Passivecanadianincome
    July 9, 2018 at 6:31 pm

    sweet Bob. congrats! Enbridge is my biggest payer as well.

    nice to see manulife in your top payouts. I have really been debating buying more. I love what they are doing in Asia.

    Anyways keep it up man. clearly your doing great. Your garden is sweet as well.

    cheers

    • Reply
      Tawcan
      July 10, 2018 at 11:39 am

      We have a lot of Manulife already so probably won’t add more until later. We do DRIP a few shares every quarter.

  • Reply
    Sascha
    July 9, 2018 at 8:12 pm

    great result!! I also averaged down on LB.

    • Reply
      Tawcan
      July 10, 2018 at 11:38 am

      Thank you Sasha. We might add more LB to continue averaging down.

  • Reply
    Mr. Robot
    July 12, 2018 at 11:27 am

    Those are some awesome results. And another one who is buying up SBUX stocks. It looks like everyone is buying them at the moment except me LOL. 🙂

    Enjoy the fruits of your hard work (see what I did there) 😉

    • Reply
      Tawcan
      July 13, 2018 at 10:36 am

      Thank you Mr. Robot. Hopefully you can get some SBUX stocks while the price is low. 🙂

  • Reply
    Dividend Portfolio
    July 12, 2018 at 9:11 pm

    Bob, first of all, congrats on the huge increase from last year. But, that table at the end just made my day and really shows the power of compounding. The idea that 6 months into 2018 is more than the entire year you had in 2014 is awesome!!!

    • Reply
      Tawcan
      July 13, 2018 at 10:38 am

      Yea the table is very inspiring to look at even for me. 🙂

  • Reply
    Money Hungry
    July 14, 2018 at 6:59 am

    I like how you are planting vegetable seeds and financial seeds and showing your progress on both =P. Both look amazing by the way! I’ve said it before, but I really like how your payments every month are pretty similar in amount. This makes EVERY MONTH a great month for you. Thanks for the motivation.

    • Reply
      Tawcan
      July 16, 2018 at 1:14 pm

      Thank you, we are seeing the fruit of our labour both on the veggie garden and dividend! 🙂

  • Reply
    Dividend Diplomats
    July 15, 2018 at 10:02 am

    Bob,

    Just freaking incredible. Congratulations on setting another record. All your hard work is truly starting to pay off and the results continue to shine through. I love reading this post every month and looking through the pictures/what you have going on in your garden. IT gets me motivated to get off my but and get my yard into better shape! Can’t wait to read about a new record in July once again.

    Bert

    • Reply
      Tawcan
      July 16, 2018 at 1:17 pm

      Hi Bert,

      Thank you. The hard work (i.e. saving and investing) is paying off but we still have a long way to go before our dividend income is equal or greater than our expenses. But we understand it takes time. 🙂

      Get your butt moving and start planting veggies in your yard. It’s so worth it, and it saves money in the long run too.

  • Reply
    Torsten Tiedt
    July 16, 2018 at 6:17 am

    Hi Tawcan,

    nice you feel better now. Also nice your portfolio felt well all the time continuing to produce income while you lay down sick. Once again, you manged 1st place in income stability with 0.85 out of 1. Yet, you shared 1st rank with a German blogger only buying us stocks also trying to create an evenly distributed income stream throughout the year.

    Probably till next month. Stay healty!

    Torsten

    • Reply
      Tawcan
      July 16, 2018 at 1:42 pm

      Thank you Torsten. Cool to see that we are doing well compared to other dividend income bloggers.

  • Reply
    Evan @ MyJourneytoMillions
    July 19, 2018 at 10:03 am

    Holy sh$t, I am in awe of that monthly dividend income! I have a LONG way to go but it is easy stay focused and inspired when you see a graph built out like that over nearly a decade

    • Reply
      Tawcan
      July 19, 2018 at 4:37 pm

      Haha thanks, hopefully this gives your inspiration to keep going. 🙂

  • Reply
    DivHut
    July 20, 2018 at 12:25 am

    Congrats on breaking another all time dividend income record. Must be a great feeling having those records fall almost every month. Keep sharing and inspiring us all on your journey. Like the SBUX pick up. I’ve been away on a family road trip the last two weeks and feel like I missed the SBUX low. Still may pick some up at these levels as I have not made my July buy(s) yet. Keep it up!

    • Reply
      Tawcan
      July 20, 2018 at 9:41 am

      Thank you DivHut. It was a great feeling to break the record once again. 🙂

      SBUX price is still relatively low so might be worth it to buy some.

  • Reply
    Jay @ the expat investor
    July 20, 2018 at 10:31 pm

    Good job! Yeah you were close to breaking that $1,700 dividends payout. Hopefully you break it on the next one, should be easy for you. Keep up the good work.

    • Reply
      Tawcan
      July 23, 2018 at 10:47 am

      Thank you, hopefully we’ll break the $1,700 dividend mark later this year. 🙂

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