The FIRE Fund is my real-life and real-money dividend growth stock portfolio.
I call it that because the portfolio allowed me to reach financial independence and retire early (FIRE) at just 33 years old.
This six-figure collection of some of the best businesses in the world is generating the five-figure and growing passive dividend income I need to sustain myself in life and cover my personal basic expenses.
The Fund provides me an opportunity to live a blissful job-free existence that promotes time over money, passions over paychecks, and value over prices.
How and why I’ve saved and invested my way to FIRE at such a young age has been covered in my two best-selling books: The Dividend Mantra Way and 5 Steps To Retire In 5 Years (also available in paperback).
I’ll below go over any and all transactions from the preceding month, covering any buys and/or sells that occurred since the last update.
You’ll see exact transactions (including dates and prices).
And I’ll quickly discuss some of the rationale behind each respective transaction.
Keep in mind, however, that these monthly updates are just snapshots in time. These updates are furthermore simply a peek at what the maintaining of a dividend growth stock portfolio post-FIRE looks like, as I’m no longer aggressively buying stocks so that I can achieve FIRE.
Stock purchasing is now more or less a function of the pure enjoyment of investing as a hobby and passion (rather than a function of becoming financially independent as fast as possible), but the ongoing casual investing of fresh capital does add to my passive income, lifestyle options, and long-term philanthropic firepower.
Moreover, the actual market value of the FIRE Fund (which is constantly oscillating) means very little in the grand scheme of things; it’s the dividend income the Fund generates that actually unlocks financial freedom for me.
To that point, I’ll also go over any dividend increases that were announced since the last update, as well as how that affects the Fund’s expected annual dividend income over the next 12 months.
PURCHASES
I purchased 5 shares of KeyCorp (KEY) on 8/2/19 for $17.07 per share. I purchased another 5 shares on 8/13/19 for $16.54 per share.
KeyCorp is a bank holding company that, through its subsidiaries, provides a range of retail and commercial financial services.
I put forth my investment rationale for KeyCorp not too long ago. So I won’t rehash that.
As I stated in the last couple portfolio updates, my current plan is to continue to accumulate shares in this bank. That hasn’t changed, and I’ll very likely continue to buy shares throughout September.
These purchases added $7.40 in annual dividend income.
I purchased 1 share of JPMorgan Chase & Co. (JPM) on 8/2/19 for $111.98 per share.
JPMorgan Chase & Co. is an American multinational investment bank and financial services company with assets over $2.5 trillion.
I’ve noted a number of times that my current plan is to continue accumulating shares in this bank.
As long as the valuation remains in this range, I have capital, and competing opportunities aren’t extremely compelling, I’ll keep buying at least one share per month until the position is full.
This purchase added $3.60 in annual dividend income.
I purchased 1 share of Delta Air Lines, Inc. (DAL) on 8/5/19 for $57.21 per share. I purchased another 1 share on 8/21/19 for $58.36 per share.
Delta Air Lines, Inc. is a global airline company.
I initiated a position in Delta Air Lines last month, and I shared my investment thesis in last month’s FIRE Fund update.
As I laid out then, I planned to buy more shares over the foreseeable future and build the position up. I’ll very likely continue to add to this position over the coming months, although I do see it as being a smaller holding in the Fund.
These purchases added $3.22 in annual dividend income.
I purchased 3 shares of Eastman Chemical Company (EMN) on 8/15/19 for $63.87 per share. I purchased another 2 shares on 8/16/19 for $65.59 per share.
Eastman Chemical Company is a global specialty chemical company that manufactures and markets a wide range of advanced materials, chemicals, and fibers which are used in various consumer and industrial products.
I last added to this position back in early June. There were no plans whatsoever to buy more during August; however, Mr. Market became particularly moody regarding this name, relegating it to the bargain bin. So I went shopping. Simple as that, really.
I always saw this as an ancillary position, though. So I may just end up capping it off here.
These purchases added $12.40 in annual dividend income.
I purchased 3 shares of WestRock Company (WRK) on 8/16/19 for $33.32 per share. I purchased another 2 shares on 8/21/19 for $33.48 per share.
WestRock Company is a leading integrated manufacturer of various corrugated and consumer packaging materials.
Like the Eastman Chemical position, I last added to my position in WestRock back in June. And like with Eastman Chemical, I had no plans to add to my WestRock position in August – or maybe ever.
But the valuation became a bit too compelling to pass up. And with the position being still relatively small, I saw an opportunity to boost the stake by 20%.
Again, though, just like with Eastman Chemical, I see this as an ancillary position in the Fund. It’s a very good business. But it’s not the kind of top-shelf quality that I’d feel comfortable being heavily exposed to.
I don’t currently have any plans to add to this position. But if the valuation becomes even more ridiculous, I might find it difficult to pass it up. It’s already materially undervalued, in my opinion.
These purchases added $9.10 in annual dividend income.
I purchased 5 shares of Leggett & Platt, Inc. (LEG) on 8/23/19 for $37.21 per share.
Leggett & Platt, Inc. is a diversified manufacturing company that conceives, designs, and produces a variety of products that can be found in homes and automobiles.
I initiated a position in this fine company a couple months ago, at which time I went over my reasoning.
And I noted at that time that I’d continue to accumulate shares in the business, assuming the valuation stayed reasonable.
The valuation is right in a sweet spot for me, so I took advantage of that opportunity and scooped up a few more shares.
I plan to add to this position in the near future, although I do see this as being more of ancillary holding in the Fund.
This purchase added $8.00 in annual dividend income.
SALES
There were no sales since the last update.
DIVIDEND INCREASES
Illinois Tool Works Inc. (ITW) announced a 7.0% increase in its dividend, upping the quarterly dividend from $1.00 to $1.07. This added $9.80 in annual dividend income.
Altria Group Inc. (MO) announced a 5.0% increase in its dividend upping the quarterly dividend from $0.80 to $0.84. This added $15.20 in annual dividend income.
Bank of Nova Scotia (BNS) announced a 3.4% increase in its dividend, upping the quarterly dividend from CAD $0.87 to CAD $0.90. This added $7.36 in annual dividend income.
FIRE FUND
The FIRE Fund is now valued at $412,851.43. That’s a 0.2% decrease from the last reported market value of $413,833.50.
There are 124 companies in the Fund. That’s unchanged since last month.
The Fund is now expected to generate a total of $14,245.58 in annual dividend income over the next 12 months. That’s an increase of 0.5%, or $74.32, over the prior update’s annual expectation of $14,171.26.
A fantastic tool for tracking your portfolio, progress, and performance is Personal Capital.
CONCLUSION
It was another fantastic month for the Fund.
Really, it’s hard to complain when great businesses continue to do great things and reward me with increasing dividends for their hard work.
It’s a wonderful position to be in.
And it’s a position that almost anyone can be in.
You simply have to take advantage of capitalism.
Don’t let the media’s hyperbole and false narratives make you poor. Capitalism is alive and well, and it’s something that you should be participating in with immense enthusiasm.
While the broader stock market apparently had a volatile August, according to headlines I’d sometimes come across, the Fund barely moved. Other than opportunistically adding to solid companies at attractive valuations, I went about my life while the Fund continued its characteristic plodding ahead.
I can’t think of any major news events regarding any of the Fund’s holdings. A few quarterly reports came in, some of which were better than others. Nothing remarkable, though.
August was a quiet month, overall.
That quietness extended over to the dividend increases.
August is always a slow month for the Fund in terms of announced dividend raises.
This August was especially slow, however, because L3Harris Technologies, Inc. (LHX) announced its dividend raise earlier than usual as it integrates its merger and switches to a new fiscal year.
That left August without one of its usual stalwarts.
But what was left was still more than enough to keep the compounding dividend snowball… well, snowballing. That snowball continues to gain size and speed, even without my help.
I’ll put that in perspective.
The $32.36 increase in my annual dividend income that came about by way of the organic dividend increases announced by my holdings this past month is analogous to investing ~$925 in fresh capital at a 3.5% yield (the average portfolio yield) – except I invested exactly $0 to achieve that increase in passive dividend income.
Not too shabby at all.
I remember back when I first started investing, it was difficult to dig up $1,000 to buy stocks. That’s a lot of money. Now I’m able to experience the same result as it pertains to my dividend income, even when I don’t lift a finger. And that’s during a slow month.
The trees in my forest continued to produce ever-more bountiful dividend fruit.
Stock prices go up and down, but dividends are almost always “in the green”. My favorite color.
I will quickly note here that Altria’s dividend raise marks the 50th consecutive year in which they’ve increased their dividend. That makes them a Dividend King. Pretty amazing stuff.
Looking toward September, it’s business as usual for the Fund.
I’ll aim to invest $500 to $1,000 in fresh capital, which is my monthly target with the Fund now in “maintenance mode” from here on out. The snowball is doing the heavy lifting – err, rolling – now.
September will almost certainly look a lot like August in terms of stock buys because a lot of the stocks I bought in August are those that I’m actively building up positions in. The notable exceptions would be Eastman Chemical and WestRock.
Beyond that, I’m sure other opportunities will spring up and interest me. I’m looking forward to sorting through those opportunities and putting some money to work.
What I’m most looking forward to, though, is just enjoying my life and taking maximum advantage of the freedom this dividend income provides me. It’s not something I take lightly. I’m very cognizant of my good fortune. And I’m grateful for it all.
I’m excited to live out another month in the life of my dreams. FIRE is absolutely, without a doubt, worth every ounce of effort and so-called “sacrifice”.
I honestly couldn’t imagine living any other way. Having the freedom to live life totally on my terms is a huge gift. Owning my time is the greatest luxury of all.
Let’s all continue to make our dreams come true!
As always, I’ll publish stock purchases in real-time over at Twitter and Facebook. So make sure to follow me there (where I also share numerous other updates about my life as a dividend expat).
Full disclosure: I’m long all aforementioned stocks.
How was your month? Are your investments performing to your expectations?
Thanks for reading.
Image courtesy of: imgflip and Warner Bros. Pictures.
P.S. If you’re also aiming to build a dividend growth stock portfolio and the necessary dividend income to become FIRE, make sure to check out some amazing resources that helped me reach financial freedom at 33!
One step at a time, keep it up!
– FN
FN,
Thanks!
Hope you had a great month, too.
Cheers.
Very nice to see organic passive income growth. My last pay raised at work was 2 years ago – working very hard for another increment, but my portfolios continue reward me just doing nothing.
Altria continues to reward its true owner –aka shareholders despite the challenges it’s been facing over the last couple of decades.
Keep up your good work Jason!
FJ,
Altria keeps on delivering those dividend increases. No complaints here. 🙂
Best regards!
Very nice Jason. Seems like an active month for you. Keep up the great work!
BHL,
I’m very pleased with how August turned out. Looking forward to another great month.
Thanks for stopping by!
Best wishes.
Can you tell us about transaction costs for your buys. I assume you aren’t paying $5 a trade ~10 percent on some of your single share purchases. I got in on a deal a few years bake with wells trade that gets me 100 free trades per year. But my college age son would like to invest and with the $ he has available, the transaction costs make it prohibitive.
Cory,
I use Schwab and currently do not pay any transaction fees:
https://www.mrfreeat33.com/resources/
I used to pay $7 per trade with Scottrade. I always tried to limit my transaction fee to 0.5%. That meant trying to make sure each transaction was, on average, $1,400 or greater.
Hope that helps!
Best regards.
Great month and update – always nice to see the consistent growth of the dividends in the results and how little the day to day portfolio value matters. DGI at its best!
-Divcome
Divcome,
Thanks!
Just a slow, steady move ahead. That’s what successful long-term investing is all about. It’s boring. But it’s beautiful. 🙂
Best wishes.
Another nice month Jason
I like your recent pickups. wrk seems really tempting at these levels
keep it up
cheers
CPI,
Thanks!
Just another month of great businesses working hard so I don’t have to. 🙂
Hope you had an awesome August, too!
Best regards.
some nice buys ,tracking EMN to add .Still remember reading your DM and looking at portfolio,Time went quickly in last few years.
desidividend,
Eastman looks really good here. I could see myself adding more, especially if it were to get back down to the $60 area. Just as well, though, I’m pretty happy with what I’ve got.
Cheers!
Hi Jason,
I like JPM as well, I am going to continue to build my position. I also like WFC, dividend is well over 4% yield now, I can’t find a time where it has ever been that high, and still making over 20B in profits in low interest rate environment. Thanks for posting!
Lukaivan,
Yeah, some of these financials look really great here. I’m just glad we have the opportunity to scoop up shares in some high-quality businesses offering pretty appealing yields. 🙂
Happy shopping!
Cheers.
Thanks for the monthly updated Jason. Great month for you, compounding month after month after… Excellent work. I had a good month as well. Take care my friend.
Anonymous,
Compounding is an amazing thing. It’s pretty much taking over at this point. I’m more than happy that I’m able to sit back and relax a little bit nowadays. 🙂
Glad you had a great month over there, too!
Best wishes.
Hi Jason, reading about your end of month progress is inspiring. The consistent dividend growth is fantastic. I think JPM is a good value here, great choice. This month of September is a good one for us, waiting for your next update. Take care my friend. Omar
Omar,
Thanks for dropping by. Appreciate the support!
I’m looking forward to September. Another month for me to live out my dreams. Another month for others to make their dreams come true. 🙂
Cheers.
Jason –
Love the buys and dividend increases, of course. Hard not to add to EMN and WRK during August, at the prices they were at.
Also, curious to see what comes of PM and MO… given any thought or letting the talks, talk and then see what impact may come about from an overall company & dividend stand point?
-Lanny
Lanny,
Yeah, the potential tie-up between MO and PM is interesting. It’s even more interesting that both stocks have been punished pretty badly on the news, as if it’s a lose-lose scenario. I don’t see it that way. I’m actually thinking of adding to my MO position and bringing it up to an even 100 shares. We’ll see what, if anything, happens between these two.
Best regards!
How do you feel about the high level of commission cost relative to the small purchases you make?
E.g. you bought 1 share of Delta airlines for around $57. I’m assuming commission on that was around $5 – $8 on that trade.
Good job building out your portfolio. Long time reader here (since DividendMantra)
Shad,
I don’t pay fees. The brokerage information, including the fee structure, can be found in numerous places throughout the blog.
I also noted this in a comment not too far above yours. See further up in this very comment section.
Cheers.
When you mention your position in KEY, you said you’ll keep buying shares “until the position is full.” What exactly did you mean by that? Are you targeting a specific percentage of your portfolio for this position? Do you do that for positions in general? I notice that your portfolio doesn’t seem to have an even distribution. you’re well diversified, but it’s not weighted evenly, or anything like that. How do you make the decision that a position is “full?”
Austin,
Hmm. I’ve never actually seen a portfolio that has perfectly even distribution. I think it would be very strange to be perfectly and evenly distributed across every business you’re invested in, as if the dynamics/goals are exactly the same across all businesses and industries. Even large ETFs don’t have equal-weighted positions. Plus, I’m not sure how that would even be done in real life. I mean, it depends on what you’re measuring. Market cap, market value, cost basis, annual income, etc. Percentages of a portfolio can vary depending on exactly what you’re measuring.
I think a “full position” (i.e., an equally-weighted position) can be technically drilled down by dividing the market value of a portfolio by its number of positions. I look at that number (~$3,300 in my case) as the baseline for being overweight or underweight certain businesses. I like certain businesses more than others, so I go overweight or underweight accordingly. A regional bank like KeyCorp would be an example of something I’d be underweight in. A global snack and beverage company like PepsiCo would be an example of something I’d be overweight in.
Best regards.