It’s October and that means we are now officially in the final quarter of 2018! Where did the time go? In late September the weather started to turn in Vancouver. We started having a number of VERY rainy days where it just poured. One day, we woke up noticing that part of our gutter was plugged. Water was just pouring down from the gutter onto our patio. I had to go outside to take out the debris in the gutter to prevent a major flooding in our yard. In less than 5 minutes, I was completely soaked.
Fortunately, we also had a few very nice warm sunny days. I’m hopeful that we will continue to get some crisp, cold, sunny fall days in October weather. I love these sunny fall days.
When it comes to our garden, Mrs. T has been busy cleaning up all the different plants and getting ready for next year. She moved the strawberry plants to another section of the garden (you’re supposed to rotate the plants every 2nd year) and removed some of the kale plants. I’m sure the both of us and the kids will be spending quite a bit of time planting in the spring.
September Dividend Income
In September we received dividends from the following companies:
- Brookfield Renewable (BEP.UN)
- Canadian National Railway (CNR.TO)
- ConocoPhillips (COP)
- Costco (COST)
- 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)
- 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)
- Magellan Aerospace Corp (MAL.TO)
- McDonald’s (MCD)
- Manulife Financial (MFC.TO)
- Magna International (MG.TO)
- MCAN Mortgage Corp (MKP.TO)
- Metro (MRU.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)
Phew, that’s quite a list! It’s hard to believe that we received 41 paycheques in September. What’s even harder to believe is the 41 paycheques totalled up to $1,696.94!
Yup, a new all-time monthly dividend income record! I love seeing the chart and seeing the candlestick going higher and higher! However, it’s too bad we were only $3.06 away from the $1,700 milestone. Oh well, maybe we’ll break this milestone in December?
Out of the $1,696.94 received, $326.05 was in USD and $1370.89 was in CAD. Or about a 20-80 split. If you are a long time reader to our monthly dividend income reports, you know that 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 Sept 2018 came from Manulife, Intact Financial, Enbridge, Suncor, and Chevron (not in order). Dividend payouts from these 5 companies accounted for 44.23% of our Sept dividend income, or $750.59.
Given that we received 41 paycheques, I was a little bit surprised that these 5 companies accounted for such a high percentage of our Sept dividend income. Perhaps we aren’t as income diversified as I thought we are?
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 the Sept 2018 dividend income, here’s the breakdown of the different accounts:
- Taxable: $481.73 or 28.4%
- RRSPs: $679.88 or 40.1%
- TFSAs: $535.33 or 31.5%
We only hold Canadian eligible dividend stocks in our taxable accounts so we can get the maximum amount of dividend tax credit.
Compared to Sept 2017, we saw a respectable YOY growth of 24.41%! That’s the second highest YOY growth number so far in 2018. Very impressive! In 2017 we only received over $1,300 in monthly dividend income once. This year, $1,300 in monthly dividend income is considered as an “off-month.” We have crossed the $1,400, $1,500, and $1,600 marks all in the same year. It is amazing to look back and see how far we have come.
After 9 months, we are now sitting at an average of 19.5% YOY compared to 2017. If we continue to hold this average, that means we’d end up with $17,727.08 in dividend income for 2018. Not a shabby number at all.
In Sept a number of stocks that we hold in our dividend portfolio announced dividend payout increase:
- Verizon raised its dividend by 2.12% to $0.6025 per share.
- McDonald’s raised its dividend by 14.85% to $1.16 per share.
All these dividend increases meant an overall annual dividend increase of $28.35. It’s not a big number but every $1 of organic dividend increase means we don’t have to add $33.34 of fresh capital (at 3% yield). In other words, every single dollar counts!
Dividend Stock Transactions
In September we made a minor dividend stock transaction. We purchased 110 shares of Canadian Utilities. This was mostly to average down our cost basis. The entire Canadian utility sector has faced headwind in 2018. Since we all need electricities and natural gas to live in Canada, it made sense to me to add some more shares of CU while the price is down.
This purchase added $173.05 in our forward annual dividend income.
So far in 2018, we have received a total of $13,709.16 in dividend income. At $40 per hour ($83,200 annual salary), that means we have saved ourselves 342.7 hours worth of work, or 42.8 days, or almost 9 weeks. That’s 17.3% of the year!
For the most part, we aren’t paying too much attention to our dividend portfolio on a daily basis. We are leaving it on auto-pilot by DRIPing when we can and purchasing more shares on existing positions. We do, however, review our dividend portfolio and run through our dividend scorecard to see whether we need to make any changes. Mrs. T and I are thankful that our dividend portfolio is working hard and generating passive income for us, so we can spend time on something else.
Dear readers, how was your September dividend income?