July 2021 Dividend Income Update

July 2021 Dividend Income Update

“Do you know the only thing that gives me pleasure? It’s to see my dividends coming in.” – John D. Rockefeller.

Ha. Love that quote…although….there is far more to life than dividends!

Welcome to my latest monthly dividend income update.

You can find my previous update for June 2021 here.

My plan and my investment approach

Since the 2008-2009 Great Financial Recession, I’ve been a hybrid investor. 

That means I/we own a blend of individual stocks and some low-cost Exchange Traded Funds (ETFs) for extra diversification. 

In more detail:

• Approach #1 – we own a number of Canadian dividend paying stocks for income and growth. At last check, we own just shy of 30 different Canadian stocks across our portfolio. I tend to own these Canadian stocks in my non-registered account and across our Tax Free Savings Accounts (TFSAs). We own these stocks because we believe buying and holding our DIY bundle of Canadian dividend-paying stocks will, over time, provide some steady monthly income for future wants and needs in retirement.
• Approach #2 – we’re owning more units of low-cost U.S. Exchange Traded Funds (ETFs) inside our RRSPs over time. While dividend paying stocks are great, we believe in passive investing. We also believe in investing abroad beyond Canada’s borders. In doing so, we’ll add growth and diversification to our portfolio. While we still own some Canadian stocks and some U.S. stocks inside our RRSPs, (names like Procter & Gamble (PG), Johnson & Johnson (JNJ), BlackRock (BLK) to name a few) we’re buying more (and holding more) U.S. ETF units every quarter going-forward.

You can read more (why the growing bias to ETFs inside the RRSP) in this lessons learned post here. 

So, for well over a decade now I’ve owned primarily Canadian dividend paying stocks inside my/our Tax Free Savings Accounts (TFSAs) for growing dividend income….AND….increasingly more low-cost U.S. Exchange Traded Funds (ETFs) inside our RRSPs.

This hybrid investing approach is absolutely allowing us to realize our semi-retirement goals.

In fact, beyond asset accumulation years, passive and active investing can live in retirement harmony too!

July 2021 Dividend Income Update

Last month, we received dividend payments from the following key stocks inside my taxable account and from our tax-free (TFSA) accounts, and DRIPped a number of shares:

• Algonquin Power (AQN) – DRIPped 8 shares
• Bell Canada (BCE) – DRIPped 5 shares
• Innergex Renewable Energy (INE) – DRIPped 1 share
• Sun Life Financial (SLF) – DRIPped 1 share
• Telus (T) – DRIPped 14 shares
• RioCan REIT (REI.UN) – DRIPped 1 share
• Smart REIT (SRU.UN).

In fact, when it comes to Telus in particular, we own enough shares such that when dividends are paid those dividends easily cover our cell phones bills every month!

(You might recall we also own enough Enbridge (ENB) stock such that when dividends are paid by them dividends our condo utility bills (heating, cooling, gas, and water bills) every month.)

What about your RRSP assets?

A reminder I don’t include any RRSP income in these dividend income reports since a) I’ve always reported it this way and b) RRSP assets are increasingly, mostly, U.S. assets. For sure, there is an income stream to be tallied from RRSP assets owned. I/we hope to leverage that to “live off dividends and distributions” in the coming years as I/we enter semi-retirement.

Check out some great questions asked, and answered by me, on my dedicated FAQs page. 

July 2021 Dividend Income Update

With stocks and ETF units DRIPping along nicely, our money continues to compound away.

Assuming no dividend cuts occur, and dividends continue to compound as they might, we have a great shot at earning $22,500 at the end of this calendar year in dividend income, from the capital invested inside our TFSAs and a non-registered account. 

As of this month, our forward dividend income is at $22,276. 

To put this income stream into perspective:

• We earn $2.54 per hour of every hour of every day (income/8,760 hours (24 hours x ~365 days)) even in our sleep.
• Part of the portfolio is essentially a job: earning $10.71 per hour (income/2,080 hours (40 hours x 52 weeks)). Then again, some of that income is 100% tax-free (thanks TFSA).

Money is compounding away this summer while I get outside and enjoy it. Just awesome. 

I hope this update gives you some inspiration for your financial journey. 

See you in the comments section!

Mark

Further reading:

You can see some of my stock holdings here. Our long-term goal is to earn $30,000 per year to start semi-retirement with.

These are dozens of articles about low-cost ETF investing and how I invest here.

You can see how other successful investors are using low-cost ETFs or dividend investing (or both) to fulfill their retirement income needs here – there are dozens of essays and case studies to check out!

Again, happy to answer reader questions on my dedicated FAQs page.