Just boosted monthly income from dividends another 2% by selling OCSL, EAD and CCUR and reinvesting the cash in CHY! The sale also resulted in nearly doubling dividend earnings from the cash invested in the former three stocks! Needless to say, I'm pretty excited about the change even if it cost me a little money in commissions. However, considering the performance of OCSL, EAD and CCUR, I think I'm much better off having gotten rid of them. My trades should be completed in time for me to capture the dividend for CHY in April. This brings my total number of dividend payments back down to 516 per year.
The month of March 2018 was up nearly 50% compared to March 2017 and tied for the all time high in monthly dividends with December of last year! While the overall value of my investment accounts is down, monthly cash flow from dividends continue to increase quite nicely. Really looking forward to all the new dividends kicking in next month. I mentioned in my last post that I'll be focusing on reducing debt dramatically for the rest of this year, however I'll still be on the lookout for ways to free up cash and increase holdings whenever possible.
A co-worker has been asking me about stocks lately. She wants to start investing but she's afraid of the markets erratic behavior of late. I told her the best day to invest in the stock market is today. If you wait, chances are you'll never start. I gave her the ticker symbols of a couple of low volatility S&P 500 etf's paying monthly dividends and told her that would be a good place to start. Once she gets her feet wet, she can move on to possibly some higher yield funds or individual stocks.
Friday, March 30, 2018
Tuesday, March 27, 2018
PAYING OFF MY HIGHEST INTEREST DEBT IN HALF THE TIME!
After reviewing how much I pay in interest each month on my charge accounts, I decided it was imperative to my financial well being to pay off my debt at a faster pace. So I'm diverting money earned on Swagbucks (see link in link exchange) towards paying off my highest interest debt. I'm still making my regular monthly payment, but this month I was able to make two additional $25 payments with cash from Swagbucks. While that may not sound like much, I used Credit Karma's credit card repayment calculator to determine how much I'd save. Not only will I pay off this debt in half the time (15 months instead of 30 months) but I will pay less than half the amount of interest!
This is my highest interest charge account. By the time it's paid off, my lowest interest account balance will have been paid down enough that the $170 freed up by paying off the high interest account will rapidly pay off the second account. After the second account is paid, I'll have $210 extra per month to pay off the third account and then I'll have an extra $270 to rapidly pay down the two remaining accounts. This is really nothing new, I think others have referred to it as the "credit snowball", but I've modified it by starting with the highest interest debt first, instead of the lowest debt. I believe that I'll save more in interest that way. It might take me a few years, but once I've paid off all my debt, I'll have freed up around $600 per month which can then be directed towards investments.
In the mean time, I'll still be reinvesting dividends and adding to my 401k each payday. So it's not like I'm ignoring my investment accounts. While I might not see the rapid gains I've seen in dividend income in the past few years, the money I save on interest will more than make up for that. In the end, the earned income freed up from being debt free will allow me to build my investment portfolio at a much more rapid pace than I ever have before. I'm pretty excited about the whole plan! Wish me luck.
This is my highest interest charge account. By the time it's paid off, my lowest interest account balance will have been paid down enough that the $170 freed up by paying off the high interest account will rapidly pay off the second account. After the second account is paid, I'll have $210 extra per month to pay off the third account and then I'll have an extra $270 to rapidly pay down the two remaining accounts. This is really nothing new, I think others have referred to it as the "credit snowball", but I've modified it by starting with the highest interest debt first, instead of the lowest debt. I believe that I'll save more in interest that way. It might take me a few years, but once I've paid off all my debt, I'll have freed up around $600 per month which can then be directed towards investments.
In the mean time, I'll still be reinvesting dividends and adding to my 401k each payday. So it's not like I'm ignoring my investment accounts. While I might not see the rapid gains I've seen in dividend income in the past few years, the money I save on interest will more than make up for that. In the end, the earned income freed up from being debt free will allow me to build my investment portfolio at a much more rapid pace than I ever have before. I'm pretty excited about the whole plan! Wish me luck.
Wednesday, March 21, 2018
DIVIDEND INCOME UP 40% FOR FIRST QUARTER 2018 COMPARED TO 2017!
With the markets down and not having as much cash available to invest as I'd like, I've been kind of concerned that I'd not be able to grow dividend income as rapidly as I'd like. While that's is still a concern, I was pleasantly surprised to see dividend income for the first quarter of 2018 is up over 40% compared to first quarter 2017! So, should I continue to grow monthly cash flow at this moderate pace, I'll still be collecting a nice tidy sum each month when I retire in four years. If at all possible, I may even work an extra year to give the earnings time to compound even more.
I was not happy with CRF's proposal to issue new shares, so I sold my stakes in both CRF and CLM. While I liked their high monthly dividend payments, the truth of the matter is, they were mostly just a return of capital. The share price has suffered all along and even though I invest more for the cash produced, I don't want to own a stock that's constantly going down in value. So I've moved on and invested the money in a bond fund (FTF) paying over 11% and a stock fund (ZTR) paying over 12%. While that's less than the yields from CRF and CLM, these two funds have better performing share prices and have actually raised dividend payments in the past. Even with rising interest rates, FTF being an intermediate term bond fund should do O.K. and the two of them together are much more conservative than CRF and CLM. Not to mention their investment styles are much more less convoluted.
While I'm just as averse as anyone else at seeing the overall value of my portfolio drop, I have been pretty happy seeing a more rapid increase in monthly income from reinvested dividends. With share prices lower, reinvested dividends purchase more shares and increase cash flow exponentially. So I'm looking at it as a good thing, since I'm still in the accumulation phase.
I was not happy with CRF's proposal to issue new shares, so I sold my stakes in both CRF and CLM. While I liked their high monthly dividend payments, the truth of the matter is, they were mostly just a return of capital. The share price has suffered all along and even though I invest more for the cash produced, I don't want to own a stock that's constantly going down in value. So I've moved on and invested the money in a bond fund (FTF) paying over 11% and a stock fund (ZTR) paying over 12%. While that's less than the yields from CRF and CLM, these two funds have better performing share prices and have actually raised dividend payments in the past. Even with rising interest rates, FTF being an intermediate term bond fund should do O.K. and the two of them together are much more conservative than CRF and CLM. Not to mention their investment styles are much more less convoluted.
While I'm just as averse as anyone else at seeing the overall value of my portfolio drop, I have been pretty happy seeing a more rapid increase in monthly income from reinvested dividends. With share prices lower, reinvested dividends purchase more shares and increase cash flow exponentially. So I'm looking at it as a good thing, since I'm still in the accumulation phase.
Tuesday, March 13, 2018
WHY ARE DIVIDENDS SO LOW AND EXECUTIVE PAY SO HIGH?
As a dividend investor who actually reads the reports from the companies I own shares of, it's always bothered me that corporate executives as a whole seem to have such generous pay packages while shareholders receive such low dividend yields. As of this writing, the average dividend yield of the S&P 500 is 1.76%. Why is that? If the companies can afford to pay their top people millions a year in salaries, bonuses and stock options, shouldn't they be able to pay their owners more than 1.76%? They may say they're holding back cash and returning value to shareholders in other ways, such as stock repurchase plans. However, the only good reason to be repurchasing shares of a company's stock is if the shares are undervalued. This is not the case with a lot of companies involved in share repurchases. So one has to wonder why they are repurchasing shares. Is it to boost executive bonuses? That would be my guess.
This is why I always vote against executive compensation packages. As a shareholder, I believe executives should be rewarded for performance and I'm not talking about share valuations that are artificially inflated due to share repurchase programs which were not necessary. Otherwise, I believe they should be rewarding their shareholders by paying a bigger dividend. If they aren't doing so, then I see no good reason to increase their pay at the expense of the shareholders. I invest to make more money for myself, not for greedy corporate executives.
This is why I always vote against executive compensation packages. As a shareholder, I believe executives should be rewarded for performance and I'm not talking about share valuations that are artificially inflated due to share repurchase programs which were not necessary. Otherwise, I believe they should be rewarding their shareholders by paying a bigger dividend. If they aren't doing so, then I see no good reason to increase their pay at the expense of the shareholders. I invest to make more money for myself, not for greedy corporate executives.
Monday, March 12, 2018
INCREASED MONTHLY DIVIDEND INCOME OVER 3% WITH NO CASH OUT OF POCKET!
I'd been sitting on over a 300% gain on my shares of UVE for a few years now and with the recent run up in price, I decided it was time to sell. I decided to invest the cash in CHY. While I don't expect to see their share price increase like UVE, they pay a monthly dividend which amounts to more than 5 times what I earned from UVE! It will also increase my total monthly cash flow from dividends by over 3%! I collected UVE's latest dividend this month and I will start collecting dividends from my new position in CHY in April. What I like most about the whole deal is I accomplished this with no money out of pocket. All in all, I think it's a great move!
Now I just have to figure out how to repeat the process every month for the next 4 years or so. Wish me luck.
Now I just have to figure out how to repeat the process every month for the next 4 years or so. Wish me luck.
Tuesday, March 6, 2018
DOUBLED DIVIDEND INCOME FROM GLAD!
Just used a portion of my tax refund to purchase more shares of GLAD, effectively doubling monthly dividend income. Purchased shares in time to collect my first dividend on the new shares by the end of the month. I decided to invest tax refund money in GLAD because they make more than enough earnings per share to cover their dividend of 7 cents per month and the price had dropped since my initial purchase. Buying shares at the new lower price also reduced my average price per share and increased overall yield!
Kicked off the month of March 2018 with 11 great dividend payments on the first! Still have 35 more dividends to collect, for a total of 46 for the month. I'm currently reinvesting all dividends, with the goal of increasing monthly cash flow and total shares owned as rapidly as possible. Don't have any plans to add any new stocks in the immediate future, but I'm always keeping my eyes open for a good deal. I look at anywhere from 20 to 40 stocks per week, but I've gotten very picky about what I buy in to. Still have some shares which haven't really panned out the way I expected, but they are still paying and I'm in no real hurry to replace them.
Kicked off the month of March 2018 with 11 great dividend payments on the first! Still have 35 more dividends to collect, for a total of 46 for the month. I'm currently reinvesting all dividends, with the goal of increasing monthly cash flow and total shares owned as rapidly as possible. Don't have any plans to add any new stocks in the immediate future, but I'm always keeping my eyes open for a good deal. I look at anywhere from 20 to 40 stocks per week, but I've gotten very picky about what I buy in to. Still have some shares which haven't really panned out the way I expected, but they are still paying and I'm in no real hurry to replace them.
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