Dividend Income Paid In January 2018 – DIU #…

It’s finally time to publish the first dividend income update of 2018!

In case you missed the 2017 dividend income updates, you can check out my newly created DIU page here.

Now, I’m especially excited to publish this months update because a new all-time high was achieved.

For the month of January 2018, I am thrilled to report that $28.26 in dividend income was paid!

As you can see from the chart included below, this months income far exceeded all of last years monthly totals.

In fact, dividend income paid in January is already equal to 48.61% of the entire amount of income earned in 2017!

Dividend Income Paid In January 2018 - DIU # 8 Click To Tweet

The Power of Dividend Income Investing

I understand that $28.26 doesn’t buy much nowadays. And I get that Bitcoin and Marijuana “investors” have experienced greater returns in the past year.

But failing to grasp the power of dividend income investing is extremely short sighted.

For example, a couple hundred percent return is better from a growth perspective in the short term. However, unless you’ve selected the next Apple or Amazon growth story, the growth potential is limited by the amount of money you can afford to invest.

To demonstrate this concept, let’s imagine that you invest $1,000 and you earn a 500% return. Ultimately, you have multiplied your money by 5, which means you end up with $5,000. But here’s the thing, though – you now have the responsibility to continue to grow that money. Frankly, it’s unlikely that the original company will grow another 500%, and it’s even more unlikely that you’ll be able to reinvest those funds to earn another 500% return.

On the other hand, you’ve got good ol’ predictable dividend income investing. In this case, let’s imagine you’re able to invest $1,000 per month in to passive dividend paying stocks yielding 5%, which is not unreasonable.

Based on those numbers, you’d end up investing $12,000 per year which would create $600 per year in dividend income.

Furthermore, if you were consistent with this approach over a 10 year period, you would’ve created a cash flow machine that generates $6,000 in annual income. Technically, if you don’t need that money to live off, you would be earning more than what could be provided by a growth stock every single year. In addition, you would then have an abundance of cash flow to take more risk on growth stocks. And this is without even factoring in dividend growth rates…

Moreover, I realized that my strategy to reach financial independence through dividend investing can realistically be achieved within 10 years.

In short, adding $1,000 in dividend income per year would create a business that generates $10,000 per year in 10 years. Again, this is without considering dividend growth rates. Based on a 10% annual dividend growth rate, your 5% yield would grow to a 10% yield in 10 years. This means that your $10,000 in annual income has now grown to $20,000. Of course, not all holdings will grow at this rate. But I kept the numbers simple for this example.

If you break the numbers down further, it would only require $83 in dividend income per month to add $1,000 per year. Considering that I’ve been adding approximately $50 in annual income the last two months, adding $83 per month is not that far off.

Nevertheless, this realization has caused me to re-think my annual income goals. And it has also made me reconsider my spending.

2017 vs. 2018 Dividend Income Paid

Dividend Income paid in January 2018

Total dividend income paid in January: $28.26

Last quarters total (October 2017): $17.95

QOQ growth (compared to October 2017): Up 57.44%

Total dividend Income paid in 2018: $28.26

Monthly average in 2018 (as of February 10, 2018): $15.78

How many businesses paid dividends in December: 4 (up 2 since last quarter)

dividend income paid

Concluding Thoughts

Based on my goal to earn at least $425 in dividend income this year, I’d say this year is off to a great start.

I added a total of $46.96 in annual dividend income in January, which has pushed income substantially higher when compared to the most recent forward update.

Furthermore, the recent market pull back has created a plethora of investment opportunities.

“If you worry about a stock market correction you shouldn’t be in the market” – Warren Buffet

As an early stage dividend investor, I more than welcome market corrections.

I look at market corrections as an opportunity to release shares from weak hands, and I feel extremely fortunate that my calm, patient nature lends itself well to investing.

In conclusion, I look forward to growing this business during the remainder of 2018. I also can’t wait to share the progress in the months to come.

To give you a clue in to how fast the RTC portfolio is growing, dividend income will surpass the 2017 total by March.

Questions for the Readers: How was your dividend income for January? What are your thoughts on the recent market correction?

  • Anthony

    Your excitement about dividend investing is jumping off the page! Great job! And that growth of dividends is great to see as well. But now, this turns into a nice game. If you pass your previous dividends in the 3rd month of this year, it’s pretty exciting to see what next March will bring! 🙂

    1. graham@reversethecrush.com

      Thanks for commenting, Anthony! I’m glad that my excitement jumps off the page. I heard a quote earlier today from none other than Kobe – “how do you use your passion, and use that to inspire somebody else to create their passion.” I think that sums it up. If my passion can inspire others then I’m winning. And it will be cool to see how far along the portfolio will be by next March. Have a good one!

  • Rob @ Passivecanadianincome

    Awesome work. Great seeing such massive growth. If you keep this up your goal will achieved in no time!
    Rob @ Passivecanadianincome recently posted…Buys, Sell and RaisesMy Profile

    1. graham@reversethecrush.com

      Thanks for the support, Rob! It will be a challenge but hopefully I can maintain this pace. It just comes down to maintaining a high savings rate. Good luck with your goals too!

  • Tom @ Dividends Diversify

    RTC, Nice summary. The last 2 weeks has certainly taken a chunk out of my holdings. The good thing is it’s easier to find some more reasonable values than at the market peak. I have added to VYM and SO, but have largely been sitting on the sideline watching the action. Tom
    Tom @ Dividends Diversify recently posted…My Only Regret In Life: Speed To A MillionMy Profile

    1. graham@reversethecrush.com

      Thanks for stopping by, Tom! Even though my portfolio is smaller, I’ve definitely taken a hit over the last 2 weeks as well. But as you mentioned, it has provided more opportunities to buy at more reasonable prices. I’ve been able to average down on couple of my recently purchased positions. Since I have a long time frame to invest, I don’t mind if the pullback continues. Have a great week!

  • Dividend Daze

    Congrats man! You almost beat me this month in dividends. I edged you out by about $1 lol. I know what you mean that it doesn’t look like a lot. But we all have to start somewhere. And the growth rate you have here is awesome. That speaks for itself. Keep it up and the snowball will take over.

    1. graham@reversethecrush.com

      Hey Daze,

      Thanks for commenting man! I know your portfolio is ahead of mine, but it’s kinda cool that we’re around the same for this month. I’ve been following your portfolio for a while and it’s been helping to inspire me. My next month will be a little lower but I’m extremely happy with the growth rate overall. As you said, the snowball will eventually take over. I’m already looking forward to sharing the results for March and April. Take care!

  • Norah @ Money Management IQ

    Miracle! Solid start to the year. Always happy to learn about another dividend income stock. Thanks for sharing and good luck in 2018.

    1. graham@reversethecrush.com

      Thanks for the support, Norah! I’m always interested to learn from other dividend investors too. Best of luck with your goals in 2018!

  • Mr Defined Sight

    Great job in January! That is a slower month for me as a lot of my companies pay out in December. Keep up the growth!

    1. graham@reversethecrush.com

      Thanks for commenting, Mr. Defined Sight! One of my larger, higher yielding positions happens to be in this month so it will probably continue to be one of the highest months. But I know it’s typically a slower month for a lot of dividend investors. Thanks for the support man!

  • timeinthemarket

    Hey man, $28 ain’t bad. It’s like 2.5 visits to chipotle if you get double meat.

    Plus, the growth from last year is huge! Keep it up dude!
    timeinthemarket recently posted…Time in the market’s 2017 goal reviewMy Profile

    1. graham@reversethecrush.com

      Hey Time In The Market,

      Thanks for the awesome analogy haha! I’m definitely happy with the progress that I’ve been making. February income won’t be as high, but March and April are going push ahead of the total dividend earned in 2017. Thanks for stopping by!

  • Engineering Dividends

    A nice strong start to 2018 with massive YoY growth. I look forward to watching you ramp up the portfolio and collecting ever-growing dividends.
    Engineering Dividends recently posted…Monthly Options Income (Feb. 2018)My Profile

    1. graham@reversethecrush.com

      Thanks for the support, Engineering Dividends! I’m really happy with the start to 2018. Everything after March will exceed the total dividend income earned in 2017, so I can’t wait to be able to start sharing the total YOY increase. Hope your week is off to a great start!

  • Jordan @ MoneyMaaster.com

    Wow, that growth is insane. The numbers aren’t huge now – but that is where the power of compounding & time come in handy!

    Looking forward to seeing the growth next year and the year after. I wasn’t able to find a list of your holdings/portfolio – is this posted somewhere on the site?
    Jordan @ MoneyMaaster.com recently posted…First monthly update of 2018 & 5 stocks I’m keeping an eye on.My Profile

    1. graham@reversethecrush.com

      Thanks for commenting, Jordan! I am certainly happy with the growth percentage as well. The consistency of my strategy is really starting to pay off. Like you said, the numbers are small, But I know that compounding will take over if I maintain this pace. Regarding the holdings, I actually don’t publish individual companies on the blog due to a work related conflict of interest. In all honestly, I’m probably being overly careful. But I mainly don’t want to risk discussing competitors on the blog. I did recently publish a break down of the portfolio that includes the sectors: http://www.reversethecrush.com/business-culture-dividend-growth-investors-portfolio/. And if you’re interested in the positions, feel free to send an e-mail to graham@reversethecrush.com and I’d be happy to share through e-mail. Take care!

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