Red Panda Laying On Branch

Relaxing My Way To 40% Dividend Income Growth In May

Another month, another big year-over-year increase in my dividend income, and the best part is that it took very little effort on my part for it to happen.

The income was driven by a handful of new purchases in the portfolio, the compounding action of dividend reinvestment, and some good ole fashioned dividend increases by the companies I hold.

Here are the dividends collected, along with the comparison to 2016’s numbers:

Table showing dividend income increases for May, 2017
May 2017 Dividend Income Report

As mentioned, the growth in income came from a variety of sources, with the biggest increases being the result of purchases made in the portfolio.

Over the last year, I opened positions or added shares in Abbvie Inc. $ABBV, CVS Health Corp $CVS, Lowe’s Companies, Inc. $LOW, and Omega Healthcare Investors Inc. $OHI. Meanwhile, Deere & Company $DE shares were sold, resulting in a loss of dividend income from that position.

Organic dividend growth was apparent from Apple Inc. $AAPL, Ameriprise Financial , Inc. $AMP, and Starbucks Corp. $SBUX, which all provided double-digit income gains over last year.

Realty Income Corp. $O also provided a double-digit gain, coming from the combination of a roughly 6% dividend increase and the compounding action of a ~4% yield. The dividend reinvestment effect was also visible from Chatham Lodging Trust $CLDT, STAG Industrial Inc. $STAG and AT&T Inc. $T, who all provided 6-7% income growth despite minimal (STAG, T) or no (CLDT) increase to their payouts.

These companies are great examples of why I like to have a mix of high and low yield in the portfolio. The low yield companies provide organic growth, while the higher yielding companies provide income growth through the effect of compounding.

Neither method requires much effort on my part. I simply buy the stock, turn on the dividend reinvestment option, and watch the income grow.

Dividend Income History

With May’s numbers out of the way, here is a look at the progress made in the portfolio since it was first created in early 2013.

Table Of Dividend History For The DGI For The DIY Portfolio
DGI For The DIY: Portfolio Dividend History

Looking big picture, dividend income was up by 2.4% over February’s numbers and has been on a steady rise since the portfolio was created. At this point I am well on pace to beat last year’s 15.6% increase for the year.

Looking Ahead

The final month of the quarter historically provides the most dividends, and recent dividend increase announcements should ensure that another income record is broken in the portfolio.

There is more on the horizon as well, as Target Corp. $TGT, Cummins Inc. $CMI, and Walgreens Boots Alliance $WBA are all expected to announce increases over the next several weeks. I’ll be waiting and watching for the announcements, and will try to share my thoughts on them as they occur.

On the writing front, I have been working on a massive update to my REIT Watch List spreadsheet, and have begun writing a new article for Seeking Alpha that will present the info and give my selections for the top opportunities in the sector.

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Thanks for reading, and Happy Investing!

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