4th Quarter Dividend Income + Annual Dividend Summary 2

Another quarter has passed by, and it’s time for me to post the dividends that my ISA portfolio earned in the months of October, November and December. It’s hard to argue about the success of long-term dividend growth investing when you can slowly and surely see dividend income rise over time and get closer to covering your living expenses.

I hope these quarterly dividend income reports provide inspiration for any investors out there that are just starting out. It shows that it’s possible to one day pay for monthly expenses with dividends, which would provide an investor opportunities and freedom to pursue other interests than full-time work.

In total, I received dividends totalling £348.67 over the months of October, November and December. This is a substantial increase over the same period last year and keeps me chugging along in my aim of using passive income to become financially free. I am beginning to love the fact that cash goes straight into my account without me having to do any work or put in any effort besides the initial stock purchase. I could be sitting on the couch all day but still make money due to having the right collection of cash generating assets. This is the beauty of pure passive income. Unlike my job where I am paid by the hour, the dividends I receive are not linked to my time or effort. By having an ownership stake in the biggest companies in the world, I am reaping the rewards of other peoples hard work. Other peoples time and effort is making me money. And for a change, that feels great. I am tired of working long hours for minimal pay rises. And by purchasing stocks and getting a growing stream of dividends, I am buying myself out.

Having a quarter like this where my dividend income is close to £350 shows the progress I have made over the past year when my dividend income was half this amount. This motivates me and it illustrates the fact that if I keep doing what I am doing , I will reach my goal of being financially free via dividend income one day.

Looking at the year as a whole, I received £1,501 in dividends from the companies I have an ownership stake in. This was made up of £347 in the first quarter, £423 in the second quarter, £383 in the third quarter and £348 in the final quarter as above. Considering I had dividend income of zero just 2 years ago, this increase to £1,501 is one that I am proud off. Sure it could have been more were it not for the likes of Cobham and Accrol Cutting there dividends. But other companies I own such as Imperial Brands, Shire and AG Barr have stepped up to the plate and produced dividend increases which helped offset the cuts in the portfolio. This is why it is important to have a well diversified portfolio full of quality companies.

Shell (RDSB) Has Been Paying Me £1 A Day

If there is one stock in my portfolio that continues to amaze me, it is Royal Dutch Shell (RDSB). The company has been a relentless cash flow machine to me. Over the past two years – the period I have held the stock for – RDSB has paid me a total of £735 in dividend income. Considering I only paid £3,900 for my shares in Shell (and the old BG), I have already received 20% of my purchase price back in the form of dividends. This is truly amazing. And even more amazing is the fact that RDSB shares have appreciated more than 60% since I bought them.

My dividend yield on RDSB is an extremely high 10% and this looks well supported as the company becomes more lean and the oil price continues to rise. Shell is one of those companies that is a never sell in my books and I will continue to hold on to it in order to extract the huge dividends it sends my way.

I was recently surprised when I was working out the dividend figures that Shell pays me just over a Pound a day. Over the last year, Shell paid me £372 in dividend income. I found this to be remarkable. I now wake up every morning knowing that I will get £1 from Shell for doing nothing but simply owning shares in the company. It feels good to be an owner in quality enterprises.

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  • https://www.smartpolak.co.uk/ Paweł Kłosiński

    Great results Money Grower! I hope you they will get even better in following months and years. I am at the beginning of this journey, I think I got around £10 in this quarter. Still something and I am quite pleased 🙂
    By the way, we all know that the markets are quite high at the moment and that at some point there may be a correction. Do you have any exit strategy, will you be selling anything? Or, perhaps, are you more focused on fundamentals and getting these dividends are the value of shares is not so important. Perhaps there are companies there more resistant to downfall of the markets? What are your thoughts on this?

    • http://moneygrower.co.uk moneygroweruk

      Hi Pawel. Congratulations on starting the journey! Starting is always the hardest part as receiving only £10 a quarter may not seem worthwhile. But looking at my experience, what may seem like a small dividend income today will grow substantially over time – All you need is perseverance and discipline.
      Markets are very high right now! But I’ve learnt not to time the market as you never know when prices will drop or explode higher. The advantage of buying individual shares as opposed to an index fund is that you can find shares that offer value even in an overvalued market. This is why I have been buying lots of Imperial Brands and Shire. As you mentioned, I do focus on fundamentals and I believe the aforementioned businesses will do well over time. Sure, if there is a corrections, the share price will drop but it will give me an opportunity to buy shares at even cheaper prices.
      I think the people that should be worried are those that have invested in companies on high valuations where the growth does not measure up to the current share price. These stocks which are priced for growth will get slaughtered.
      For Full disclosure, I have about 20% of my portfolio in cash so if any crash does come, I have the money ready to buy great businesses at bargain prices. Hope this helps