It’s time for our monthly dividend income update. For those of you that are new, we plan to live off dividends when we are financially independent. While it would be amazing to receive $360k in dividend a year like Reader B, we’d be happy with around $60k in annual dividend income.
We are doing these monthly dividend income updates to keep ourselves accountable and to demonstrate that it is possible to build up a sizable dividend portfolio over time. For now, we are aiming to reach our $60k dividend income goal by 2025. I will admit, it is a massive task!
As a leader for a local Beavers colony, I have been helping and teaching the kids aged five to seven various Scouting skills. The pandemic meant we had to do a lot of meeting virtually since the past September. We met outside once the weather was nice again. Thankfully, everyone stayed healthy throughout the year and we all had a lot of fun. At our year-end wrap-up meeting, it was great to hand out many badges to the kids.
It shouldn’t come as a surprise that our backyard garden kept us really busy throughout June as a lot of the veggies were ready for harvest. Since we could only eat so much, we had to preserve some veggies by blanching them first then freezing or pickling them. We also made a ton of Chinese dumplings with home-grown vegetables then freeze them for consumption later.
Dividend Income – June 2021
Too many pictures? Let’s resume to dividend income update, shall we?
In June 2021, we received dividends from the following companies:
- BlackRock (BLK)
- Brookfield Renewable (BEP & BEPC)
- Canadian National Railway (CNR.TO)
- Canadian Tire (CTC.A)
- Canadian Utilities (CU.TO)
- Dream Office REIT (D.UN)
- Dream Industrial REIT (DIR.UN)
- Enbridge (ENB.TO)
- European Residential REIT (ERE.UN)
- Fortis (FTS.TO)
- Granite REIT (GRT.UN)
- H&R REIT (HR.UN)
- Hydro One (H.TO)
- Intact Financial (IFC.TO)
- Intel (INTC)
- Johnson & Johnson (JNJ)
- McDonald’s (MCD)
- Manulife Financial (MFC.TO)
- Magna International (MG.TO)
- Metro (MRU.TO)
- PepsiCo (PEP)
- Qualcomm (QCOM)
- RioCan REIT (REI.UN)
- Saputo (SAP.TO)
- SmartCentres REIT (SRU.UN)
- Suncor (SU.TO)
- Target (TGT)
- Unilever plc (UL)
- Visa (V)
- Waste Management (WM)
- Wal-Mart (WMT)
- iShares Ex Canada International index ETF (XAW.TO)
The 32 dividend paycheques added up to $2,943.51 After a low dividend income in May, it was nice to see a monthly dividend income that’s closer to $3,000.
Out of the $2,943.51 received, $456.01 was in USD and $2,487.5 was in CAD or about a 15-85 split. Please note, we do not convert USD to CAD when reporting our monthly dividend income. I have been using this approach to avoid fluctuations in our monthly dividend income because of changes in the exchange rate.
The top five dividend payouts for June were iShares Ex-Canada International Index ETF, Enbridge, Fortis, Manulife, and Brookfield Renewable (not in order). The dividends from the top five payers for June added up to $1,986.32 or 67.5% of our June dividend income. June’s dividend income was highly concentrated with these top five dividend payers. Ideally, for income diversification purposes, we want the top five payers to account for about 50% of the monthly dividend income.
After a month where we saw negative YoY dividend growth, it was comforting to see 23.05% YoY dividend growth when compared with June 2020. We have made many purchases throughout the first half of 2021 and we are finally receiving dividends from these purchases.
If we look at the overall YoY growth for 2021, we are sitting at an average YoY growth rate of 13.3%. We would like to see this number to be 15% or more. Therefore, we will need to continue to add new cash and buy more dividend paying stocks, including some of the best Canadian dividend stocks.
Like the previous five months, we kept ourselves busy on the dividend stock purchase front. We made two purchases in June.
- 180 shares of AQN.TO
- 23 shares of BNS.TO
AQN’s price has traded sideways the last year. Since I see AQN as one of the core long-term holdings in our dividend portfolio, it makes sense to continue to build up our position and wait for the stock price to recover later. We’ve done the same approach with the likes of Bank of Nova Scotia and Enbridge in the past and it has worked out well.
Although we already hold a sizeable amount of Bank of Nova Scotia shares, I purchased more because I believe BNS has more room for further price growth. The Canadian banks are posed to hike their dividends or pay out special dividends in the fall, so I wanted to take advantage of this eventuality by owning a good chunk of Canadian bank shares.
These two purchases added $205.63 toward our annual dividend income.
For July we plan to continue to add more dividend paying stocks. Telus, BCE, Apple, Canadian National Railway, TD, and Royal Bank are some stocks we’re monitoring.
In June, only one company we own announced dividend payout increase. But the increase was HUGE!
Target increased its dividend payout by 32.4%, its dividends went from $0.68 per share to $0.90 per share. Although we don’t own that many Target shares, I was thrilled to hear about the +30% dividend increase.
It would be very nice to see more companies raising their payouts by more than 30%! Who knows, maybe the Canadian banks will announce 20-30% dividend payout increases in the fall?
After six months, we have received $15,063.38 in dividends. Looking at our dividend income history, we have already crossed the annual dividend income of 2017. I continue to feel very grateful and blessed for how much progress we have made on our dividend income. Living off dividends tax free will eventually be a reality, as Reader B has assured me when he first contacted me.
To put things in perspective, our dividend portfolio generated $3.47 per hour during the first six months of 2021. At an hourly working wage, the portfolio generated $14.48 per hour, assuming 26 working weeks and eight hours each week.
Dear readers, how was your June dividend income?