Dividend Update: May 2015
May’s dividend totals are in the books, and I saw some impressive growth. I’m building a rising stream of passive income, so I no longer have to stress out about finding my next editing or producing job and I can work solely out of passion. I recently wrote about my latest high risk/reward opportunity in my portfolio update. These updates help me track and predict my progress so I can see where I’d stand if I ever needed to use my dividend income for expenses. This practical use of the cash flowing into my investment accounts is the main reason I love the dividend growth investing strategy.
In May, I received dividend payouts from seven separate businesses totaling $113.64 which I automatically reinvested into more shares for free. Here’s a snapshot of that activity over the month:
My automatic dividend reinvestment’s added $4.82 in forward annual income, which is a 4.24% yield on my $113.64 total payout. I’m now on pace to earn a minimum of $100 a month going forward, but that could change at any point with alternate pay dates or upcoming spin-offs. May’s total dividends of $113.64 grew 25.20% over last quarter in February, when I earned $90.77. Going back further, that increase was 65.17% over last year’s $68.80. Here’s my updated dividend payouts chart:
I set out to receive $2,050 in dividends this year, and after five months I’ve earned just $567.69. With only 27.69% of my goal completed, I have some serious work to do in these next few months. I’ve been on a roll in June so far, already putting over $5,000 in new contributions to work which I’ll be posting about soon. It’s going to take a lot more than that to see this goal through, and I plan to keep things rolling:
May was also the first month in a long time where I had no dividend raise announcements among my holdings. I spoke last month about Chevron (CVX) and their failure to increase their dividend, and I’m watching closely. Here’s an update from VP and CFO Pat Yarrington of Chevron:
Let me just start by saying that maintaining a competitive and growing dividend is our number one priority. That has not changed. Our financial priorities have not changed, but what has changed is our immediate financial environment, the near-term environment has changed and so the board chose not to increase the dividend this quarter.
It is similar to what we did back in 2008 and 2009, when prices last fell significantly. We are supporting a 3.8% yield, but clearly, we are not running very strongly on earnings or cash flow at the moment due to commodity prices. I think it’s fair to say that the first quarter was not a very stable financial environment, it was very fluid in terms of both revenues and costs. And so I think our overall decision is going to be based on what we feel is affordable and supportable in perpetuity, because we don’t want to get into a position where we are having to cut the dividend or trim the dividend in anyway.”
I bought my first round of dividend growth stocks two years ago in May 2013, before I even found this awesome blogging community. The first dividend didn’t hit my account until July of that year, but even with my short history I’ve managed to rake in $1,403.94 in lifetime dividends which has all been reinvested toward the cost basis of my portfolio either selectively or automatically. Here’s what that looks like so far:
I’m working hard to keep the contributions coming, and that’s the name of the game with a portfolio my size. Every little bit I can add today brings me that much closer to financial freedom. June is going to be a big month, and so far I’ve been very happy with several deals that the market is offering.
What are you buying? What are your thoughts on Chevron’s dividend?