Ahh, dividends.
Even just hearing that word conjures up all kinds of warm and fuzzy feelings for me.
I remember playing the board game Monopoly as a kid. My favorite Chance card was the one where Mr. Monopoly (or Rich Uncle Pennybags) collected his bank dividend of $50.
I thought that was so neat. Collecting money for nothing. Growing up as poor as I did, it seemed like a pipe dream as a child.
Well, it’s no pipe dream.
But it is a dream; it’s a dream of a lifestyle that almost anyone can live, as I’ve proven out over the years.
Mr. Monopoly sits on my shelf at home, reminding me every day of just how far I’ve come…
How far?
I went from below broke in early 2010 to financially independent in early 2016.
And I did so with no particular advantage(s) over anyone else. I grew up in a crack house in Detroit. My parents abandoned me. I have no college degree. I worked at a car dealership making ~$50,000 per year – until I didn’t.
Those six years of my life I set aside to aggressively save and intelligently invest my capital resulted in financial freedom at 33 years old – which is how I became Mr. Free At 33.
That financial freedom is underpinned by the five-figure and growing passive dividend income my FIRE Fund generates on my behalf.
I aptly named my portfolio the FIRE Fund because it allows me FI/RE (financial independence/retired early).
The Fund is a portfolio built on the tenets of dividend growth investing, whereby I allocate my capital almost exclusively toward high-quality stocks that have lengthy track records of paying rising dividends year after year.
These are world-class businesses. Because of that, they tend to rake in more profit year in and year out. And because shareholders are ultimately the collective owners of any publicly-traded company, growing dividends are our rightful share of that growing profit.
Well, the growing dividends that are sent my way by the businesses I own a slice of are enough to cover my basic personal expenses in life, meaning I don’t need to ever have a job again. Haven’t had one since turning 32 years old. And I have no plans to ever have one again.
What you’ll soon see is the tangible manifestation of all of these concepts I write about.
The table below lists every dividend I received (as well as each respective company that paid it) from the preceding month.
This is real cash money, folks. Every time a dividend comes in, that’s real-life money I can use to do whatever I want with. Now we all know why Mr. Monopoly loved to kick back with a cigar, like a boss.
When you’re collecting a dividend a day, you are a boss!
Without further ado…
| AT&T Inc. (T) | $100.00 |
| General Mills, Inc. (GIS) | $31.85 |
| Verizon Communications Inc. (VZ) | $44.25 |
| CVS Health Corp. (CVS) | $10.00 |
| American Express Company (AXP) | $7.00 |
| Raytheon Company (RTN) | $21.69 |
| The Clorox Co. (CLX) | $28.80 |
| General Dynamics Corporation (GD) | $18.60 |
| Air Products & Chemicals, Inc. (APD) | $22.00 |
| British Am Tobacco PLC (ADR) (BTI) | $16.53 |
| AbbVie Inc. (ABBV) | $38.40 |
| Abbott Laboratories (ABT) | $9.80 |
| Colgate-Palmolive Company (CL) | $21.00 |
| EPR Properties (EPR) | $14.40 |
| Hormel Foods Corp. (HRL) | $3.75 |
| Kinder Morgan Inc. (KMI) | $13.00 |
| Main Street Capital Corporation (MAIN) | $22.80 |
| National Retail Properties, Inc. (NNN) | $68.88 |
| Omega Healthcare Investors Inc. (OHI) | $105.60 |
| ONEOK, Inc. (OKE) | $79.50 |
| Procter & Gamble Co. (PG) | $36.58 |
| Realty Income Corp. (O) | $20.85 |
| Stag Industrial Inc. (STAG) | $13.02 |
| Tanger Factory Outlet Centers Inc. (SKT) | $12.25 |
| Apple Inc. (AAPL) | $14.60 |
| HCP, Inc. (HCP) | $29.60 |
| Welltower Inc. (WELL) | $39.15 |
| Fastenal Company (FAST) | $18.50 |
| Chatham Lodging Trust (CLDT) | $15.95 |
| Nestle SA (NSRGY) | $48.33 |
| Papa John's International Inc. (PZZA) | $2.25 |
| Starbucks Corporation (SBUX) | $9.00 |
| Williams-Sonoma, Inc. (WSM) | $10.75 |
| Total: | $948.68 |
Just for reference, a great resource for tracking your portfolio and everything related to it is Personal Capital.
Wow. I still can’t believe it sometimes.
I remember waiting tables part time at a Big Boy restaurant (a type of diner) in Michigan during college. I had to work an entire month to make $1,000 back then.
Folks, it was brutal, hard, grimy, dirty, sweaty work. Running around for a tip of $3.00 really humbles you.
I can think back to exactly how I felt as I was cleaning out the salad bar at midnight, about how I’d one day never have to do anything like this again.
Well, I went from working for Big Boy to becoming a big boy. A big dividend boy, that is. I’m all grown up now.
To be able to collect that same ~$1,000 for doing nothing at all makes me feel incredible.
John D. Rockefeller has a famous quote about how seeing his dividends come in was the only thing that gave him pleasure in life. I actually feel sorry for someone who only feels joy from collecting money, but I can say, for sure, collecting my dividends is a very pleasurable aspect of my life (although far from the only pleasurable aspect). I can also say it’s a hell of a lot more pleasurable than cleaning out a salad bar at midnight, after a long and tiring day of serving food.
This month’s dividend income is 30% higher than the $730.15 I collected in May 2017. The total amount of dividend income I’ve collected in 2018 is now up to $4,798.97.
That greatly exceeds my expectations for YOY dividend growth from the Fund. My portfolio is more or less in “maintenance” mode now, meaning I’m no longer aggressively investing thousands of dollars per month so that I can achieve FIRE (because I’m already FIRE).
But I still invest a little bit of capital here and there. And that’s combined with the organic dividend growth from the companies themselves as they go about increasing their dividends pretty routinely, which ends up creating the snowball effect that allows for a runaway snowball of growing dividend income that will one day be more than one can reasonably spend.
Over 30 different companies sent me a dividend during the month of May. In fact, the number of dividends I collected during the month of May exceeded the number of days in the month of May. Indeed, I’m still collecting a dividend a day, which keeps the unwanted job away!
I can tell you I’m glad to no longer be waiting tables. That’s definitely an unwanted job I’m very grateful to keep away. And it’s all thanks to investing in high-quality dividend growth stocks.
Another fantastic month in the books.
I hope you all had a phenomenal month of May, too!
Full disclosure: I’m long all aforementioned stocks.
How was your month? How much dividend income did you collect? Is your dividend income (and the growth of it) living up to expectations?
Thanks for reading.
Image courtesy of: bplanet at FreeDigitalPhotos.net.
P.S. If you’d also like to collect five-figure dividend income and reach FIRE, check out some phenomenal resources that personally helped me become financially independent in my early 30s!
Jason,
Very impressive. I love reading your updates, and your articles. I can’t help but think about your future dividend income. Keep up the great work.
Lukaivan,
Thanks so much! 🙂
I’m blessed. And I’m so glad to put these updates together. It shows the tangible result of all that saving and investing. And it’s this dividend income that underpins everything I’m able to do. Couldn’t live the life of my dreams without it.
Hope you had a great month, too!
Best regards.
Hey Jason,
Very good month for you, I know that your June dividend income will be even higher than last month.
30% growth year-over-year is absolutely amazing, especially without new contributions… I can feel the power of dividend growth.
Keep it up!
FJ,
Thanks. June should be pretty stellar. Excited, as always. 🙂
I’m still contributing a little capital. But it’s very little relative to where I used to be with that. Sometimes it’s as little as a hundred bucks or so. Sometimes I’ll invest as much as $1k. The dividend growth is pretty much taking over, which is fantastic.
Thanks for dropping by!
Cheers.
Very Good number of month of May.We have quite a few common stocks and T Dividend is impressive
desidividend,
I do love seeing that AT&T dividend roll in! 🙂
Glad to be a fellow shareholder with you in a number of these fine businesses.
Best wishes.
Looks like another great month for you Jason in dividends. The YOY dividend increase looks really impressive. I enjoy reading the updates that you put out please keep them coming. Like you I enjoy when dividends go into my account. Then I can decide how best to spend or better yet reinvest $$$ into high quality stocks, bonds, real state etc. I enjoy making money especially when I don’t have to work for it, yeah dividends. let your money work for you.
Enjoy the journey
cheers
Michael,
I enjoy working. But I think my money enjoys it more than me. I let it have at it. 🙂
Thanks for stopping by!
Cheers.
Great work! Out of interest, do you use your dividend to pay for your expenditures or reinvest?
wealthyby40,
Thanks a lot!
My dividends pay for my living expenses. I sometimes buy stock with my active income.
Cheers.
Another awesome month in the books I’ve been enjoying following along. I am just starting out on my journey but I have managed to save and invest enough to get my yearly dividend up to $2253 so far after a little less than a year and a half. I am already starting to see the compounding effect kick in! I look forward to next month.
FR,
That’s great stuff. Compounding is the name of the game, and what a wonderful game it is. 🙂
Keep it up!
Best regards.
Thanks for the update. You have a very well diversified income stream. The awesome thing is that if one of those companies went bankrupt (highly unlikely) , you may not even feel it with the other companies bringing in regular dividend raises. I look forward to future updates. You are certainly living the dream!
Brent,
Definitely. I’ve always been mindful to set things up that way. Even if, say, Hershey were to completely vanish overnight (an impossibility), I wouldn’t really be affected. Not only would my life not change at all due to diversification, but the dividend growth from the other 109 companies would quickly make up for that loss. It’s a self-correcting machine. I love it. 🙂
I’m super fortunate. Doing what I can to help and inspire others.
Cheers!
Gotta love nearly $1K in dividend income and a 30% year over year increase! Looks like we both received nice payouts from T and OHI. Congrats! Keep up the amazing work and thanks for the update! 😀
MDD,
Gotta love those big dividends from AT&T and Omega! 🙂
Thanks for dropping by.
Best regards.
Hi Jason,
I think that your strategy of diversifying the fund into various shares is a good one. It spreads your risk into many baskets and will be able to withstand the dividend flow should a few businesses go downhill. A good strategy indeed!
Ben
Ben,
I like being widely diversified. I sleep very, very well at night. 🙂
Of course, each investor has to figure out a level of diversification that works best for them. But I still see quite a few high-quality companies out there that I don’t yet own a slice of…
Cheers!
Jason –
The big takeaway here is that you are 30% higher compared to last year, time and consistency with your dividend strategy has paid off immensely. Such a nice list of sound companies paying you and I am pumped up that these figures will keep increasing steadily, without you having to do much! Congrats J!
-Lanny
Lanny,
Thanks, man!
Yeah, the snowball just keeps on rolling. I’m pretty good at staying out of the way and letting it do its thing. 🙂
It’ll be interesting to see where these reports are at in a decade or so. It’ll be more than I need for sure, but it’s awesome to be able to show people what this stuff can do for you.
Best wishes!
Boy I’ve done those types of jobs and have thought the same thing -I don’t want that again! I think about it now when I leave a tip – about how hard that person is working for it(and I leave a generous amount).
JayP,
I’m the same way. It’s not customary to tip over here, but I like to leave a little something whenever we go out to an actual restaurant. There’s worse jobs, but waiting tables is not fun.
Cheers!
Great job on getting nearly $1,000 in dividend income for May. Just one thing, there are 31 days in May. You need to get 2 more companies to have more dividend payers than days in the month. But great job on the 30% increase yoy. You’re living the good life. And just like Mr. Monopoly, you’re sitting with your feet up and grabbing all those dividends.
Chad,
Maybe I counted wrong here. I count 33 companies. That’s more than the 31 days in May.
I’m definitely enjoying it, though. Today it was an awesome lunch, a few hours at the coffee lunch, a full-on workout, a long dinner, and now just watching YouTube videos on interplanetary expansion. Another day in the life. So, so fortunate. 🙂
Hope you had a great month, too!
Best regards.
Good job on setting up the lifestyle. Have you analyzed where the 30% increase is coming from? Is it mostly from companies increasing their dividend that much y-o-y, or is it due to new investments or one-time special dividends?
Ty,
Thanks a lot. I’m thoroughly enjoying life these days. 🙂
It’s to that point (enjoying life) that I don’t analyze every iota of this stuff. I don’t keep a bunch of spreadsheets. Other investors love to go over spreadsheets and stare at numbers. To each their own, but that’s just not me. The lifestyle is covered, so I’m pretty happy.
Monthly YOY changes occur due to dividend growth, new capital investments (which have been purposely scaled back), and dividend payout changes (dividends sometimes fall on different dates, and occasional portfolio changes can also affect this). The number I’m more interested in is the annual dividend income the portfolio is pumping out, which factors out that last issue. Monthly variations don’t really matter too much to me.
Cheers.
I understand. I just think it would help readers who are not yet in your position to know if the 30% increase is coming from the investing strategy or from new money (from active income?) invested in the stocks?
Ty,
Right. And that’s why I break that down in the FIRE Fund Updates, whereby I show new investments and how that affects forward-looking dividend income, as well as recent dividend increases and how that affects forward-looking dividend income from the standpoint of organic growth.
I can only bring that point home so many times before I’m repeating myself ad nauseam. Since I’m not investing much fresh capital any longer, and since I’ve already written countless articles on this, it seems like enough by now.
Cheers!
Jason,
I’m a relatively new reader. So I apologize if you have answered these questions a million times already and I just haven’t read the blog posts yet.
Can you please tell me what your target is for each holding, i.e. how big of a percentage of the portfolio do you try to limit each stock to? How did you decide on stopping at 110, or is that just a coincidence? Last question, what made you decide to go with buying individual stocks versus using an etf or fund with a dividend growth/income focus? My broker charges $7 per transaction, so the fees would be pretty high if I made lots of small purchases versus larger focused purchases on a particular etf/fund as an example.
P.S. I really like your blog a lot. Thanks for taking the time to share all of this great information.
chomper,
Thanks for stopping by. Glad you’re enjoying the content.
These are questions I’ve gone into with quite a bit of depth over the years. I’d recommend checking out my book, or you can read through the archives at Dividend Mantra (a site I founded and ran for about five years). DM focused a lot more on money, investing, and methodology. My writing has grown as I’ve grown, so I don’t cover the same stuff I was talking about in 2012. But there’s a lot of information out there. If you do decide to pick up a copy of the book, I’d be happy to go over some specific points if there’s something that’s not clear for you. 🙂
I will say I was with Scottrade for years. They charged $7 back when I built the bulk of the portfolio. So that’s not a hindrance. The hindrance is not saving enough to offset that fee. People will look at a $7 fee and think it’s a lot of money, yet not think twice about blowing $40 on a Saturday night with friends. That requires a change in mindset. Furthermore, there are brokerages out there that charge quite a bit less than that (some are even free). I just don’t see that as an issue any longer.
Best regards!
Brokerages are always offering deals for free trades, also. Anytime I run out, I just call them up and ask for more…
Not bad man. You beat me with around $200. One question: do u only focus on dividend income or also total return. I mean, you are still so young that it makes sence for you to also max your total return.
Personally, I focus on creating a passive income machine while indexing to play both games.
Stockles,
Your question seems to presume or imply that high-quality dividend growth stocks don’t offer outstanding total return, or that high-quality dividend growth stocks don’t tend to beat the broader market over the long run. Those implications would be incorrect.
That said, my goal all along was to become financially independent as soon as possible. Getting there in six years beat my expectations. Whatever wealth I eventually go on to build will be given away, so my portfolio’s performance relative to what someone else or some other basket of investments is doing really doesn’t matter too much. But it will probably do rather outstanding just by the nature of things.
Cheers!
nice Jason.
great to see your adventure as well as your progress. 30% growth is huge with you not putting much money into the market.
i got over 300$ last month in dividends but with our other passive incomes we surpassed 1000$
ive been following you for awhile, keep it up love your posts!
all the best
cheers
CPI,
Thanks for stopping by!
Congrats on a big month over there. Sounds like May was great. 🙂
Best wishes.
Hi Jason,
Inspiriing update. The 30% bump YOY is pretty spectacular. The snowball is really getting out of control!
Take care,
Ryan
Ryan,
Thanks so much!
I love seeing that snowball roll. The income will almost certainly grow way, way faster than my expenses will. It’ll be interesting to see the delta between the two, say, 10 years from now. I hope I’m still blogging down the road to show that. 🙂
Hope you had a great month, too!
Best regards.
I just love the fact that you have a frame on your desk with the Monopoly guy in there. Thats just awesome! Great resuktls hitting allmost $1k in May. It will take me many many years to get to that level, but I will get there.
Mr. Robot,
He’s a constant companion. 🙂
Appreciate the support. It might take you a bit to get there, but it didn’t happen for me overnight. Keep at it!!
Best wishes.