May 2026 Dividend Income Update

May 2026 Dividend Income Update

Hi DIY Investors!

Welcome to a new month and our new tally: our May 2026 Dividend Income Update.

For established readers and some new readers that recently joined my free newsletter (thanks folks!), this is our monthly update to share how we are progressing with our hybrid portfolio now in retirement – a structure we actually established way back in 2009:

1. We invest in a mix of about 20+ Canadian stocks for income and growth, and
2. We invest in low-cost equity ETFs for extra diversification. 

That’s our equities.

Everything else is cash / cash equivalents for near-term spending for the rest of this 2026 calendar year at least.

You can read about establishing your own cash wedge position prior to retirement and maintaining it during retirement below!

The Cash Wedge – Managing Market Volatility

May 2026 Dividend Income Update

Last month I wrote: 

“When does this stock market party end?? Something has to give, right?”

Well, this month, things continue to roll and dividend raises continue to roll in too. Thanks to strong, recent big bank earnings, our annual dividend income went up which just means more retirement spending for us over time to counter sustained, higher inflation. 

On the subject of inflation, I recently read an article from a blogger that mentioned: “….Ultra-short bonds carry no price risk…” making inflation Kryptonite to anything but short-term bonds.

The article goes on to mention: “…If you have dedicated inflation fighters in the portfolio you’re not too worried about bonds delivering negative returns. We know that stocks don’t always go up.”

Some clarifications from my point of view:

1 – Bonds always carry some risk beyond price risk.

In fact, every investment class carries some form of risk. Even the safest-looking asset classes expose you to some financial dangers:

• Inflation Risk: The risk that your money’s purchasing power decreases, meaning your investment grows slower than the cost of living. That applies to short-term bonds.
• Interest Rate Risk: The risk that changing central bank rates cause the market value of your existing fixed-rate assets to drop.
• Liquidity Risk: The danger of not being able to sell or cash out an asset quickly.

2 – Stocks do always go up over time. Otherwise, people would not invest in them and everyone would just invest in bonds instead. 

While it is true that during certain periods, bonds and stocks alike do struggle (see year 2022 when many believed the 60/40 portfolio was dead), long-term over many long investing periods stocks rise and in aggregate they rise rather significantly over bonds. 

This makes investing stocks excellent inflation fighters and not short-term bonds. 

If you continue to own shorter-term bonds as a buffer against temporary stock declines, that’s all fine and good, that’s just not us. We don’t own any bonds and we have no plans to own any bonds.

For early retirees like us, we believe in cash / cash equivalents: cash-alternative ETFs, money market funds, higher interest savings products and the like are our desired home for all near-term spending needs. That’s what we have in place for the rest of 2026.

Not bonds.

This is my investing thesis, what we practice, but your mileage may vary of course and I welcome your thoughts on holding bonds / short-term bonds.

“Any money you absolutely need within the next 1-2 years should be maintained in cash/cash equivalents for near-term spending.” – My Own Advisor. 

Why would anyone own bonds now?

May 2026 Dividend Income Update

What does this have to do with our May 2026 Dividend Income Update?

Well, since the start of this year:

• Our portfolio is up. 
• Our dividend income is up. 
• Short-term bonds are up slightly but not up over the last 5-years when you factor-in inflation – inflation continues to run much higher than 2% annualized. That seems risky to me. 

Source: Vanguard Canada, VSB Results. 

Thanks to a few big bank dividend increases along with the likes of some energy names that increased their dividends in May, our projected annual dividend income (PADI) continues to grow for retirement spending and to fight necessary inflation.

In fact, big banks did very, very well overall as part of recent earnings reporting:

• RY raised its quarterly dividend by 12 cents to $1.76 per share. 
• NA raised its quarterly dividend, will now pay $1.32 per share, an increase of eight cents per share.
• BNS raised its quarterly dividend by four cents to $1.14 per share.
• CM announced a plan to buy back up to 30 million shares, or 3.3 per cent of its outstanding share count, over the next year. No dividend raise this time around.
• BMO raised its quarterly dividend to $1.71 per share.
• TD raised its dividend by four cents to $1.12, payable on July 31.

Our latest projected annual dividend income update tells me we’re on track to earn about $85,202 this calendar year. Most of this dividend and distribution income will be coming in as cash, saved up, for future 2027 spending. We only have DRIPs enabled for our Tax-Free Savings Accounts (TFSAs).

As mentioned earlier this year, we are not likely to reach our year end target of earning $90k this year without more investing but we shall see…I might put some cash to work later this year but then again we need our cash/cash equivalents to cover current day-to-day expenses and more international travel in 2026…

Reference: Dividends page.

For reference in any monthly update, I’ve posted some FAQs related to our portfolio income journey and reporting here. For example, I don’t include my future workplace pension nor any government benefits in these updates. We’re far too young to accept those income streams!!

I continue to share these projections never to brag nor ever to boast but rather to share what a long-term, disciplined (hybrid) investing approach via a mix of stocks and ETFs can deliver. These can be the same results for you if you follow a similar investing path. 

I look forward to sharing the next update with you and sharing how our portfolio is doing overall halfway through 2026.

Do share: how much income does your portfolio generate for you? If you don’t measure that, why not?

Mark