Business Dividend Income Projections as of August 28, 2018

• $20.89 of annual dividend income was added since the previous report was published on August 1, 2018.

• Total dividend income projected is $438.09 annually.

• Two Dividend raises were approved during the month.

• The RTC Dividend Portfolio now generates $209.20 more than last year.

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Another month of business dividend income growth has passed so it’s time to review how much income was added.

Overall, August was a solid month of growth for the dividend business. $20.89 in annual income was added through a combination of saving money and through dividend raises.

Two dividend raises from two separate companies contributed to business dividend income growth. In total, $4.97 worth of income was added from the raises. This brings the total income from dividend raises to $9.40 year to date.

In addition, the Portfolio Manager (PM) implemented a tax plan and considered which account types to hold. In turn, a few trades were made to align with the strategy.

Although income increased to a new record high of $438.09 annually, portfolio expenses also increased sharply in August.

A review of the month is included below.

[bctt tweet=”The RTC Dividend Business earns $438.09 per year | Forward Dividend Income Update # 9″ username=”reversethecrush”]

Business Dividend Income Report #9 – Dividend Income Numbers for August 28, 2018

Number of businesses owned: 10 (Down 1 since last report)

Total annual dividend Income projected: $438.09 (Up $20.89 | Up 5%)

Average dividend income projected per month: $36.51 (Up $1.74)

Per day: $1.20 (Up $0.06)

Percent to target (Minimum $18,360 annually – will be increased by 2% yearly): 2.39%

Expenses

Cost to acquire income in 2018: $188.10

Expenses since the prior report: $29.70

Total income added in 2018: $209.20

Profit Margin in 2018: 11.22% (Down 7.67% compared to the previous report)

** Profit margin is not referring to overall portfolio return. It is a measurement to determine how much dividend income was added compared to the cost of trading fees.

Operations overview to achieve Business Dividend Income Growth

The $21 (when rounded) added is tied for 5th most income added in 1 single month. In other words, it was an average month.

Another obvious downside to this month’s performance is that expenses ballooned by $20 compared to the prior report. This was mostly due to a few minor tax moves that were made, but it was also due to regular buying.

Of course, the most promising statistic is that 23% of this month’s dividend income growth was a result of dividend raises.

$4.97 of the $20.89 added was a result of two companies increasing their dividend payments. Since dividend growth investing is such an important aspect of my plan to reach financial independence, having 23% of this month’s growth happen through dividend raises is a sign that the portfolio is headed in the right direction.

In total, $9.40 of this year’s increase is a result of dividend raises now. Without those dividend raises, the portfolio wouldn’t have surpassed more than $200 added in 2018 yet. Even over a short period of time it’s obvious that dividend growth investing works.

Portfolio Activity

Two small positions were sold to be invested into core positions, and a new position was acquired during the month.

I found an opportunity while searching through a stock screener that meets the RTC criteria. It’s either a value play or a value trap, but the dividend is there, and the numbers made sense for a purchase. At this point, the new position is still small. If the stock price declines I intend to add more. But I do not expect it to ever become a core position. It will always be one of my smaller positions.

As a result of these changes, the portfolio now stands at 10 companies in total. However, I started to funnel money into an RRSP, so the number of companies will likely double over the next few years. There are at least 10 USD positions that will be added to the portfolio at the right price.

To sum up the portfolio activity in August, 6 trades were made in total, two dividend raises were received, and 1 new company was added.

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Concluding Thoughts on Business Dividend Income

After an active month for the portfolio, the focus will be on lowering portfolio expenses in September. The PM anticipates that 1 to 2 trades will be made, maybe 3 at most.

Though, the focus will remain on income growth, especially now that $500 is within reach.

Forward income could surpass $500 annually by November at a $21 per month pace. But then that puts the goal of $650 annually out of reach. As such, I will need to pick up the pace in the months ahead. It’s going to be a challenge.

In conclusion, the portfolio now generates $438.09 in passive income per year. I’ve still got a lot of work to do, but it’s comforting to know that I’m nearly $200 away from covering 1 month’s rent with dividends.