For me, it felt like September disappeared in a blink of an eye. This was probably because I spent over 2 weeks in Taiwan for business, including spending 4 days in a quarantine hotel.
For the Labour Day long weekend, a good friend of mine invited a bunch of us to have an end-of-summer-BBQ at his place. In total there were 15 adults and 10 kids at the BBQ. Most of us met and became good friends at university around 20 years ago. While some had to leave in the evening, many ended up staying for the night to have more time to chat.
After almost 3 years not seeing everyone due to the global pandemic, it was really nice to meet up in person again.
Like July and August, our backyard garden continued to produce delicious veggies for us. Considering how much food costs due to high inflation, we must have saved a lot of money this summer thanks to our garden.
While in Taiwan, I spent most of my time in meetings and having business meals. I was surprised that I didn’t gain any weight from the trip. I guess it helped that I was hitting the hotel gym regularly. It probably also helped that I walked frequently while on the trip. For example, one night I walked for over 8 km and explored different parts of Taipei.
While not having business meals, I was trying to enjoy as many Taiwanese cuisines as possible. Since the cost of living is pretty low in Taiwan, I was able to find cheap Taiwanese food easily.
Overall, it was good to travel for business again and put faces to names that I have been talking to for the last 3 years.
Dividend Income – September 2022
In September, we received dividends from the following companies:
- Brookfield Asset Management (BAM.A)
- BlackRock (BLK)
- Brookfield Renewable Corp (BEPC/BEPC.TO)
- Canadian National Railway (CNR.TO)
- Canadian Tire (CTC.A)
- Dream Industrial REIT (DIR.UN)
- Enbridge (ENB.TO)
- Fortis (FTS.TO)
- Granite REIT (GRT.UN)
- Hydro One (H.TO)
- Intact Financial (IFC.TO)
- Intel (INTC)
- Johnson & Johnson (JNJ)
- McDonald’s (MCD)
- Manulife Financial (MFC.TO)
- Metro (MRU.TO)
- PepsiCo (PEP)
- Qualcomm (QCOM)
- RioCan REIT (REI.UN)
- SmartCentres REIT (SRU.UN)
- Suncor (SU.TO)
- Target (TGT)
- Visa (V)
- Waste Connections (WCN.TO)
- Waste Management (WM)
- Wal-Mart (WMT)
Phew, that was a long list! In all, the 26 dividend paycheques that we received added up to $3,436.89. A very solid month and it’s nice to see a jump in our September dividend income compared to previous years.
Compared to September 2021, we saw a YoY increase of 28.96%! While it’s not as impressive as the 56.72% YoY increase that we saw in August, I’m very happy with the over 25% YoY increase given we’re facing the law of big numbers already. What I’m even more pleased with is the fact that we’re seeing an average 37.8% YoY increase compared to 2021!
As you can see below, our Q3 2022 dividend income was slightly higher than Q2 2022. It would be awesome if we can continue this trend in Q4.
Out of the $3,436.89 received in September, $491.12 was in USD and $2,945.77 was in CAD. This is roughly a 15-85 split. Please note, we do not convert USD to CAD when reporting our dividend income. We are doing this to keep the math easy and to avoid fluctuations in our monthly dividend income caused by changes in the exchange rate.
Despite wanting to increase our USD dividend income, it is challenging given the weak Canadian dollar. Getting more dividends in USD is definitely a work in progress for us.
The top five dividend payers in September were Brookfield Renewable Corp, Enbridge, Manulife, Fortis, and SmartCentres REIT (not in order). The dividends from these five payers added up to $2,628.35 and accounted for 76.5% of our September dividend income.
The market was very bearish in September so I really wanted to take advantage of the opportunity and buy some dividend paying stocks. However, because we’re saving money for the 2023 TFSA contribution ($13k in total, assuming the contribution room will be $6,500 per person), we didn’t want to move too much cash for investment, only to find ourselves short of a few thousand dollars in early January.
After some calculations, however, we decided it was OK to add some new cash. So with new cash and cash on hand from dividend payments, we added 32 shares of CM.TO. This transaction added $106.24 toward our annual dividend income.
We’ll probably remain relatively quiet on the buying front for the remaining of the year…
Dividend Reinvestment Plans (DRIP)
To keep our investment strategy as simple as possible, we try to enroll in drip whenever we’re eligible. This allows us to drip shares whenever we receive dividends and allows us to dollar cost average through time.
In September we dripped the following shares:
- 5 shares of BEPC.TO/BEPC
- 30 shares of ENB.TO
- 3 shares of FTS.TO
- 1 share of H.TO
- 2 shares of INTC
- 12 shares of MFC.TO
- 2 shares of REI.UN
- 5 shares of SRU.UN
Adding 60 shares commission-free was pretty awesome. Best of all, thanks to DRIP we reinvested $2,543.03 immediately and increased our annual dividend income by $149.32!
In September the following companies announced dividend hikes:
- Emera (EMA.TO) increased its dividend payout by 4.1% to $0.69 per share.
- Fortis (FTS.TO) increased its dividend payout by 6% to $0.565 per share.
- Verizon (VZ) increased its dividend payout by 1.25% to $0.6525 per share.
- Starbucks (SBUX) increased its dividend payout by 8.2% to $0.53 per share.
These four dividend increases added $89.51 toward our annual dividend income.
So, thanks to DRIP and dividend increases, our annual dividend income increased by $238.93 in September. At a 4% dividend yield, that’s equivalent to investing $5,973.25 in new capital. The dividend snowball is certainly getting bigger and bigger and compounding itself for us.
Year to date, thanks to DRIP and organic dividend growth, our annual dividend income has increased by $2,436.66, or on average $270.74 per month. That’s like investing $60,916.50 in new capital if we were to use a 4% dividend yield for calculation. Gotta love having our money working hard for us so we don’t have to.
After three quarters, our dividend portfolio has generated $31,394.43 for us. We have already surpassed our 2021 annual dividend income and yet there are still three more months to go in 2022.
Needless to say, we are very pleased with our progress. It’s crazy to think that only 10 years ago we were getting just over $1,000 in dividends per quarter. Fast forward to 2022 we are averaging more than $3,400 per month or over three times what we were receiving a decade ago!
It blows my mind how far we’ve come!
To put our dividend income into perspective:
- After 273 days, our dividend portfolio generated $115.00 per day or $4.79 per hour. This is roughly the same hourly rate compared to August.
- After 40 working weeks, our dividend portfolio generated an equivalent of $156.97 per day or an hourly wage of $19.62. This is a slight increase compared to August.
For October, we plan to continue doing what we’ve been doing for the last 11 years – live below our means, save & invest money each month, and let our money work hard for us.
Yes, building an investment portfolio and growing net worth doesn’t have to involve complicated strategies. I believe we should all strive for using the most simplistic growing net worth strategy possible. The simpler the strategy, the more likely you’ll stick with it; the more complicated the strategy, the more likely you’ll give up.
Keep it simple!
One important thing to keep in mind… while dividend income is nice and all, I want to remind all readers that total return is what really matters. If you’re collecting dividends but your principal is down by 50%, that doesn’t do you any good. In this scenario, you’re just getting your own money back.
Wouldn’t it be better to receive regular dividend paycheques but also see your principal grow? A growing principal also gives you the option to sell shares if you need more supplementary income.
Remember, total return matters!
Dear readers, how was your September dividend income?