November 2023 Dividend Income Update

November 2023 Dividend Income Update

Hey Everyone!

Welcome to a new update: our November 2023 Dividend Income Update.

For those of you new here, including new subscribers, we’ve been on a multi-year journey to increase our dividend income to fund part of our semi-retirement plan.

Dividends aren’t everything, they are just part of total return for sure, but I really, really like getting paid. 🙂

As 2024 approaches, are we changing our plan?

Heck no.

This is why in today’s post. 

Last month, I highlighted we’ve received more than a few dividend raises this year.

Here are some examples:

  • BCE 
  • BEPC 
  • BIPC
  • BMO
  • BNS
  • CM
  • CNQ 
  • CNR 
  • CPX
  • EMA
  • EQB
  • FTS
  • GWO
  • MFC
  • NA
  • RY
  • Telus
  • TRP
  • WCN
  • and more…

In just the last few weeks, we received the following increases from these stock tickers in our portfolio without lifting a finger:

  • ATD (25% increase!)
  • BMO (again)
  • CM (again)
  • CNQ (again)
  • ENB
  • NA (again)
  • RY (again)
  • SU 
  • TD
  • Telus (again)

Nice month!

Of course, I don’t just invest in Canadian stocks.

I have and continue to own just a few U.S. stocks for some upside and defensive plays. Our U.S. stocks includes the odd long-term hold such as BlackRock (BLK), along with some low-cost ETFs for growth. It’s just simple that way. 

As you might recall, I’ve been selling off some U.S. stocks over the years in favour of low-cost ETFs beyond Canada for investing. 

I’ve published when I started buying some of these companies and more importantly why in some Then and Now posts you can read about below:

Then and Now – BLK

I/we also own low-cost tech ETF QQQ.

Then and Now – QQQ

But back to our Canadian stocks, home bias some benefits: so many Canadian companies are dividend-shareholder friendly and have been that way for decades or generations. 

As part of that list, don’t forget our Canadian railroads for total returns since that matters (I own them too).

Those companies have been very good to shareholders over the years and nothing tells me that a similar upside trend won’t continue for years to come…especially if/when borrowing costs come down over time from where they are. 

Source: Portfolio Visualizer. 

Hey, as an example, if 50+ million shares of CNR is good enough for Bill Gates, then just a few CNR shares are good enough for me. Ha. 

Bill Gates CNR

Source: Stockcircle.

November 2023 Dividend Income Update

As 2023 comes to a close in a few weeks, we’re very close to realizing another major financial milestone in our lives that’s almost 20 years in the making: becoming mortgage free.

I look forward to sharing that update sometime in early 2024. 

Until then, thanks to so many juicy dividend raises in recent weeks, here is our Projected Annual Dividend Income (PADI) update for this calendar year:

November 2023 Dividend Income Update

Image/Source: Pexels, Jean Frenna.

Some notes:

  • We just crossed the $44k barrier, nearly $1,000 gained in just one month thanks to these recent raises!
  • A reminder this is income from our taxable accounts (x2) and RRSPs (x2) only. Why? Those are the accounts we’ll live off dividends from in semi-retirement coupled with part-time work first. #FIWOOT

Part-time work + dividends = FIWOOT

  • Unlike other advisors or money experts, we continue to believe cashflow is king although higher portfolio value is nice too. That means along with some portfolio growth via low-cost ETFs, we continue to believe higher dividend and distribution income will be important to help fund part of our retirement needs and wants – without selling shares or ETF units for a few years to come. 
  • We don’t include any income from any TFSAs we own (x2 accounts) in this tally since we won’t be touching those assets for potentially another 20-25 years. 

November 2023 portfolio changes

None. 

Simply, sometimes, predictions do come true…

From September’s update:

“Between now and the end of 2023, I also expect small dividend increases from TD Bank (TD) and the aforementioned Enbridge (ENB). We might also see some special dividends from some Canadian oil and gas stocks too…”

And from October:

“Between now and the end of 2023, I also expect a small dividend increase from TD Bank (TD) in particular. 

Looking much further ahead, I can foresee some special dividends from some Canadian oil and gas stocks coming our way too…like CNQ and TOU by May or June 2024. We’ll see??!!”

I will continue to keep a bias to dividend stocks for part of our porfolio until the dividends stop rising year after year.

Of course, you should not have 100% of your portfolio in stocks – or maybe you should!!

Should you have 100% of your portfolio in stocks?

Thanks very much for reading and I welcome any comments or questions you might have!

Do share how your income journey is coming along too. We all started somewhere. 

Mark

My name is Mark Seed - the founder, editor and owner of My Own Advisor. As my own DIY financial advisor, I'm looking to start semi-retirement soon, sooner than most. Find out how, what I did, and what you can learn to tailor your own financial independence path. Join the newsletter read by thousands each day, always FREE.

26 Responses to "November 2023 Dividend Income Update"

  1. Congratulations Mark on getting to yet another level! Quick question – does your reported dividend number only include distributions from equities and ETFs … or does it also include any pay-outs from any e-funds or fixed income holdings (GICs, etc)?

    Reply
    1. Great question.

      The reports I do include RRSPs (x2) and Non-Reg. (x2), all equity assets, all dividend income and distribution income for equity assets we own inside those four accounts. I do not include any dividend or distribution income from my LIRA or our TFSAs, let alone any other assets we own.

      We do not own any bonds or GICs as well.

      Hope that helps!
      Mark

      Reply
  2. Well done .
    I have a strategy that I’m trying only one year old so not sure of tax savings . This is what I’m trying I have a paid off house and a active corporation but semi retired spend winters in warmer climates . The money required to keep a house and a winter RV pad was driving up my taxes . So here is the plan I take my $16000 dividends from my tfsa and use as general revenue this can be reinvested in following year . First week of January I take money out of my Corp and reinvest amount I took out and also make my new tfsa investment last year $13000.
    Now in late December I take money out of my Heloc and pay back the Corp . Now in early January I will pay off the Heloc and buy new TFSA from Corp and continue. Only interest will be a couple weeks and I need last year $29000 less in taxable income . Thoughts ?

    Reply
    1. Hey Jeff,

      I also have a small, active corporation.

      My own plan is to not touch TFSA assets for the coming decades, let that money compound tax-free, and take tax inefficient money for spending first (RRSPs, Non-Reg. and small dividend withdrawals from corporation).

      I think if you have excess cash inside your corp., then yes, taking $$ from corp. as a dividend each January and moving the money to TFSA is long-term, tax smart.

      The HELOC is also prudent to pay off of course. The most successful business folks I see at Cashflows & Portfolios work I/we do have no debt, minimal debt in retirement and lots of cashflow from multiple sources (corp or rental, + RRSPs + Non-Regs, etc.).

      The combination of no debt or low debt + high sustainable cashflow is very tough to beat!! 😉
      Mark

      Reply
  3. I’m 71. No Pension other than a bit of CPP – practically all of my income comes from investments and enhanced OAS (waited until 70 for a 36% premium. For young investors 20 dividend growth stocks comprising “the best of the best” major companies with a long history of raising their dividends will pay handsomely in the long run. I’m living proof this strategy works – bar a major downdraft as in 1929. On the other hand 2008 and 2020 were gifts to the brave. I do not hold any fixed income – bonds, preferreds (although admittedly there are some great bargains out there … I’m just comfortable with an all stock portfolio), Gold (a Royalty firm like Franco Nevada is fine) or Bitcoin (no cash flow, just a risk of capital exposure for potential gain). Pick fine stocks with assiduous management at a great price like JNJ, PG, Royal Bank, or CNQ, Fortis, CN Rail. It’s not Rocket Science and you don’t need a financial advisor – you can easily do it yourself.

    Then comes tax time in April … and you will be shocked at how low your taxes will be … and how simple it becomes.

    I have a lot of cash on the sidelines and will pay more tax for 2023 because of the higher interest rate. That’s OK … this is where the enhanced OAS payments will help. Practically all of it will be recycled back to Ottawa either as clawback or taxes but I’m not complaining. Plenty would like to have my “problem”. It will take until $170,000 before all of my enhanced OAS is clawed back … that was part of the plan … a portion clawed back and the rest to pay taxes.

    Keep your Cdn stocks in your non registered trading account to garnish the provincial and federal tax credits. Unused credits can be used to offset income from other sources so if you’re working it’s another advantage. Keep your US stocks in an RRSP as they are not subject to the 15% withholding tax per the US-Canada tax treaty. Max out your TFSA. A gift from Harper – use it! And keep reinvesting your dividends whenever you can as in the long haul that is where the really big money is …

    When you have to draw down you’re just living off the income and not the principal. The whole “4%” draw down rule is nonsense, utter rubbish. On the other hand your RRSP withdrawal is another matter as it is government mandated. But between your growing dividend portfolio and withdrawals from your TFSA (only the income!) as needed you’ll be compensated for the “pain”. Besides, if you’ve loaded up on American dividend growth stocks in your RRSP and garnished a tax receipt for the yearly contribution during your accumulation phase while avoiding the 15% withholding IRS tax then this is small beer.

    Reply
    1. Love the details, Barry.

      You’re one of many readers I have that absolutely tout stocks and cash as a portfolio construction for the long-haul.

      re: “I do not hold any fixed income – bonds, preferreds (although admittedly there are some great bargains out there … I’m just comfortable with an all stock portfolio)….” etc.

      I own all of those: JNJ, PG, RY, CNQ, FTS, CNR….and I fired my money manager well over a decade ago. I doubt I would be where I am now with any financial advisor paying 1% or more in annual fees.

      With new 2024 tax rates, I’m actually / continually shocked that any senior in Canada can make $85k per year and still get full OAS. Wild.

      Thoughts?

      Thanks for that, I do!

      re: “Keep your Cdn stocks in your non registered trading account to garnish the provincial and federal tax credits.”

      Yupper. All CDN stocks there and will continue to buy more.

      I also keep all my U.S. stocks inside RRSP.

      TFSA is maxed and I will have $14k ready to go for investing as later today, for Jan. 2024.

      Finally, we are aligned on the 4% rule. I nice starting point but entirely useless when it comes to more detailed retirement income planning. Ha.

      https://www.myownadvisor.ca/the-proven-path-to-early-retirement-ignoring-the-4-rule/

      I appreciate your detailed comment!
      Mark

      Reply
      1. The OAS threshold for 2023 is $86,912 and for 2024 $90,997. It’s suppose to be inflation indexed as our TFSA contributions … a big jump from 2022 when it was $81,761. Clawback is based on your income after the gross up (138%) on your eligible dividends which is fair enough. I don’t really need it but it’s of no advantage to me to not take it. And it does come in handy as it gets recycled back (taxes) to Ottawa beyond the 50% which gets clawed back. So it becomes a wash so to speak. But take note Seniors – it also includes capital gains BEFORE applying any capital losses which I discovered while doing taxes for 2022. Anyway that’s what happened to me.

        I’m of no political persuasion, only demanding transparent governance. Having said that I disagreed with the Liberals reducing retirement age from the proposed Harper target over 5 years (I believe) to 67. The framework gave all plenty of time for conscious long term planning. Most developed nations are raising their thresholds for obvious reasons and in my belief it was purely for electoral gain to keep it at 65.

        Reply
        1. Thanks, Barry.

          Personally, I find it incredible that any senior making around $90k per year, each, can get full “income security” from our government. Could be a lengthy discussion – ha – but this makes no sense to me and I believe some serious overhaul of OAS (with GIS) should be done – these programs are too bureaucratic and too complicated IMO but I don’t want to rant. 🙂

          So, I’m with you on government transparency but also simplicity. Both could be a stretch, sadly.

          Have a great weekend to you!

          Reply
    1. It is! A few things to announce in the spring, 2024, but I will leave that for then 🙂

      I appreciate the support my friend and kudos to your growing income stream yourself. You and your family are going to have many, many financial options in the coming years.

      Mark

      Reply
  4. Lloyd (63, retired at 55) · Edit

    “becoming mortgage free.”

    There is just something about not *paying* interest that is just so darn enjoyable! You’ll love it! Congratulations!

    Maybe even better than getting dividends from companies one pays fees or services for (banks, telcos, utilities, etc)?

    Reply
      1. Long time no comment. I remember when your goal for dividend income was $30k!! Seems like a lifetime ago and you’ve blown past that number easily. I had to read your latest dividend blog to find out which stocks increased their quarterly dividends! Thanks to you I have quite a few of them! All the best for the holidays! I’m trying out Portugal in 2024 for the winter.
        B

        Reply
        1. Ha, yes, coming along Bonnie!

          All the best back and Portugal sounds lovely for 2024. We’ve been there and enjoyed it. Including lots of fine port 🙂
          Mark

          Reply
  5. Hi Mark,

    Thank you for the great post!

    I’m curious why you didn’t implement the Smith Manoeuvre?
    I started implementing it a year ago investing in dividend paying stocks like the ones you listed above and wished I started 10 years ago!
    I’m wondering why every Canadian with a mortgage is not doing it?

    Look forward to your thoughts on it.
    Thank you!

    Reply
    1. Ya, a few reasons.
      https://www.myownadvisor.ca/should-i-implement-the-smith-manoeuvre/

      I simply prefer to avoid too much leverage, debt, etc.

      We will be debt free in 5 months now so it’s all moot and beyond that, we already have a decent amount of non-reg., tax efficient assets/stocks delivering higher income each year now without any HELOC.

      There is no question the SM can work for the disciplined investor, over time, but it’s a very long-haul strategy with complications that most DIY investors cannot likely handle.

      Thoughts? 🙂

      Happy to discuss!
      Mark

      Reply
  6. This is awesome! Love it.

    We recently hit the $50k mark across all accounts, including our TFSAs. When I model our decumulation plan it includes not touching TFSAs and making maximum contributions, funded from our-nonregistered account.

    As I review our plan (sometimes, obsessively, I admit) I’ve come to think that while “the plan” is not to touch the TFSAs we will be more than willing to access those funds for larger expenses – an extended stay in Australia? A round-the-world cruise? An EV? A roof? Windows?

    Who knows what the future will hold, but I’ll rest easy knowing we will have the option to do it!

    Congrats Mark, especially on the mortgage front. We had to refinance a few times over our now 25 years in our house and roll up some debt while doing it so we’re about 8 years away at current amortization. We renew in June 2025 and I’m planning on making enough of a prepayment to get the mortgage polished off by 2028 – our proposed retirement. Lots of diligent saving in our future!

    ~James

    Reply
    1. James, excellent work: earning $50k per year from your portfolio is no easy feat!!!

      I would say 80% of the folks I support/help at Cashflows & Portfolios, should consider the following for asset decumulation:

      1. RRSPs first or Non-Regs. first or blended approach.
      2. Leave TFSAs “until the end” for any estate planning, old age longevity risk, etc.
      3. Defer CPP to age 65+ and take OAS as late as possible.

      The complications arise with workplace pensions, part-time income, lots of non-reg. assets, if corporations are involved, rentals, etc.

      For the majority of folks, if they simply start taking out RRSP/RRIF assets in their 60s to “smooth out taxation” and to take advantage of income splitting, this is a way to meet both income needs and avoid unnecessary/higher taxation as they age.

      Just the way it is – simple and no need to overcomplicate things. 🙂

      I look forward to hearing about your higher income stream and lower debt! A killer 1-2 financial approach and something I’m/we’re trying to practice ourselves.
      Mark

      Reply
  7. Congratulations Mark. Exciting future ahead.
    Do you plan to draw any income generated from the two TFSA as you should be able to easily add 500/month into your income. I assume you plan to continue funding them going forward so every 14K added generates approximately 500 annually. Curious what the the thought process is.

    Reply
    1. Thanks very much, Gruff. You’ve been a reader for years (thanks very much) and watched the progress – the good and the indifferent! Ha.

      Well, without debt, we should be able to start thinking about pulling away (a bit) from full-time work. That’s part of the plan for 2024 and I will post what happens on this site. 🙂

      As for the income generated inside the TFSAs, I don’t report it purposely for some privacy reasons, and more, but I can say if I did it would certainly push the projected annual dividend income updates I do each month – MUCH higher, and to your point, more than $500 per month.

      For 2024, as we continue to work full-time (more to share…) our plan is to:

      1. Max out TFSAs in Jan. 2024 (3 weeks).
      2. Max out RRSPs in spring 2024.
      3. Reassess our own financial projections for semi-retirement, that includes an “NRT” drawdown order in the coming years as we continue to work part-time.

      https://www.myownadvisor.ca/financial-independence-update/

      From that:

      -Non-Regs + RRSPs largely spent/gone in our 50s, 60s, and 70s….as to leave,
      -Some Non-Regs (no RRSPs – gone) + my pension + government benefits (CPP, OAS) + TFSAs in our 80s+.

      That’s our thought process to meet our income needs and “smooth out taxes” – that approach and math seems to work very well for us.

      Thoughts back?
      Mark

      Reply
      1. Excellent plan and you always have the option to access the TFSA funds if needed. I know you have modelled out a variety of strategies to smooth out the taxes. My goal is to keep the average tax under 10% while MTR is 25%.
        We are also melting down RRSP first and it should be gone before we reach age 70. The non reg hold emergency money.
        Our plan is to max income short term so CPP, OAS, pension were started ASAP.
        82% of our current retirement income is guaranteed and inflation protected so there are no worries about running out of money.

        Reply
        1. Great tax range, while meeting your spending needs. Kudos.

          Having most of your income that is a. guaranteed and b. inflation protected makes your retirement days pretty much bulletproof.

          Have a great weekend! I’ll keep you posted on any progress next month! 🙂
          Mark

          Reply

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