I have six securities that pay monthly dividends: BHK, FSC, JQC, CSQ, O and OIBAX. I suppose I am kind of agnostic about monthly dividends versus quarterly. I own enough dividend paying securities that my cash flow (when I retire) would be already kind of spread out. I suppose it is always better to get money a little faster. I do reinvest my dividends, so monthly is a bit more of a bookkeeping exercise. Either way I love to get dividends, and to me the coolest thing is to get dividends on my dividends. Then you know you are starting to compound your way to wealth.
Current Expected Yield of Portfolio
With the recent sale of PM and SBS, the expected yield on my portfolio is now 4.6% and the annual expected dividends (note these are all multiplied by an factor for privacy reasons) is $56,479. The table below splits it by stock:
| Estimated Dividends for Next 12 Months | ||||||
| Stock | Shares | Ann Dividend / Share | Yield | Projected Dividend | Sector | Worth |
| BHK | 2,994 | $ 0.88 | 5.8% | 2,623 | Bond | 44,967 |
| CPL | 1,530 | $ 1.76 | 7.4% | 2,693 | Utility | 36,392 |
| CSCO | 4,230 | $ 0.32 | 1.9% | 1,353 | Tech | 72,495 |
| CSQ | 5,293 | $ 0.84 | 8.3% | 4,446 | Hybrid | 53,361 |
| ENH | 2,000 | $ 1.24 | 3.5% | 2,480 | Insurance | 71,120 |
| FCX | 1,021 | $ 1.24 | 3.5% | 1,266 | Resources | 35,999 |
| FSC | 2,678 | $ 1.15 | 11.0% | 3,078 | Hybrid | 28,007 |
| HFC | 1,069 | $ 0.90 | 2.3% | 962 | Resources | 42,151 |
| INTC | 1,291 | $ 0.92 | 3.5% | 1,187 | Tech | 34,205 |
| JPM | 1,661 | $ 1.20 | 3.2% | 1,993 | Finance | 61,469 |
| JQC | 4,717 | $ 0.80 | 8.5% | 3,774 | Hybrid | 44,247 |
| KMF | 1,817 | $ 1.72 | 6.2% | 3,125 | Pipelines | 50,066 |
| KSS | 909 | $ 1.28 | 2.5% | 1,163 | Consumer | 47,093 |
| KSW | 13,673 | $ 0.20 | 5.2% | 2,735 | Construction | 53,053 |
| LNC | 2,442 | $ 0.32 | 1.4% | 782 | Insurance | 55,223 |
| MPC | 575 | $ 1.40 | 2.8% | 805 | Resources | 28,999 |
| MSFT | 959 | $ 0.80 | 2.6% | 767 | Tech | 29,025 |
| O | 546 | $ 1.72 | 4.2% | 939 | Services | 22,251 |
| OIBAX | 3,837 | $ 0.34 | 5.2% | 1,301 | Bond | 24,864 |
| PGR | 2,000 | $ 0.41 | 2.1% | 820 | Insurance | 39,600 |
| PRE | 1,023 | $ 2.56 | 3.5% | 2,619 | Insurance | 75,193 |
| PVD | 417 | $ 5.13 | 5.8% | 2,140 | Finance | 37,126 |
| SAI | 3,926 | $ 0.48 | 4.0% | 1,885 | Services | 46,565 |
| STO | 1,040 | $ 0.98 | 3.9% | 1,019 | Resources | 26,151 |
| TROX | 2,021 | $ 1.25 | 5.3% | 2,526 | Resources | 47,645 |
| VIVHY | 2,896 | $ 1.30 | 6.7% | 3,765 | Consumer | 56,501 |
| WBK | 508 | $ 8.13 | 6.5% | 4,126 | Finance | 63,633 |
| XOM | 223 | $ 2.28 | 2.6% | 508 | Resources | 19,571 |
| Total | 4.6% | 56,879 | 1,246,973 | |||
Now what is super cool about reinvesting the dividends is that annual dividend will grow by the yield rate every year (kind of/sort of) if I do nothing and nothing changes. So in 2013, it would be $59,473 and in eight years, when I am 60 (and perhaps retired), it will be over $81,000 a year! That is doing nothing.
But the added beauty is that the securities (if I have picked well), have a reasonable likelihood of INCREASING their dividends regularly. The table below tracks dividend increases I have had in the past 9 months or so (note, I have sold a few of the securities):
| Dividend Changes | ||||
| Date | Stock | Prior | Current | Change |
| 12/1/11 | KMF | 1.64 | 1.67 | 2% |
| 12/30/11 | LNC | 0.20 | 0.32 | 60% |
| 1/31/12 | CSQ | 0.63 | 0.84 | 33% |
| 2/3/12 | PRE | 2.40 | 2.48 | 3% |
| 2/3/12 | AZN | 1.85 | 1.95 | 5% |
| 2/7/12 | STO | 0.94 | 0.98 | 4% |
| 2/7/12 | FCX | 1.00 | 1.25 | 25% |
| 2/9/12 | CSCO | 0.24 | 0.32 | 33% |
| 2/9/12 | SBS | 2.39 | 3.03 | 27% |
| 3/13/12 | USB | 0.50 | 0.78 | 56% |
| 4/2/12 | RTN | 1.70 | 2.00 | 18% |
| 4/2/12 | KMF | 1.67 | 1.70 | 2% |
| 4/25/12 | XOM | 1.88 | 2.28 | 21% |
| 5/3/12 | WBK | 0.80 | 0.82 | 2% |
| 5/7/12 | INTC | 0.84 | 0.90 | 7% |
| 5/9/12 | KSW | 0.15 | 0.20 | 33% |
| 5/10/12 | PVD | 4.67 | 5.13 | 10% |
| 6/5/12 | HFC | 0.40 | 0.60 | 50% |
| 6/6/12 | BHK | 0.80 | 0.88 | 9% |
| 6/28/12 | KMF | 1.70 | 1.72 | 1% |
| 7/30/12 | MPC | 1.00 | 1.40 | 40% |
I do not think it is unreasonable to expect to pick up 2% a year on average from increased dividends. If you plug that into the compounding machine, that $81,000 per year at age 60 becomes $95,000!
Finally, my intent (as long as I am working) will be to keep adding to my dividend portfolio. So that will also accelerate the amounts further.
Upcoming Dividends
I do keep track of upcoming dividend x-dates. I also estimate the number of additional shares of stock I will be getting upon reinvestment. I do this because the worst enemy of us as investors is ourselves. It is easy to panic and sell when the market drops and you think it will keep dropping. But this table (along with other tables) help me remember that when the prices drop, my yields actually rise and I get more shares at reinvestment, which is a good thing when you are a buyer. The focus on dividends as opposed to price, helps me sleep at night and makes it more real rather than casino-like.
| Upcoming Dividends | |||||
| Stock | Shares | x Date | Div/Share | Est New Shares | Amount |
| CSQ | 5,293 | 8/8/12 | $ 0.07 | 36.0 | 370 |
| XOM | 223 | 8/10/12 | $ 0.57 | 1.0 | 127 |
| BHK | 2,994 | 8/12/12 | $ 0.07 | 14.0 | 219 |
| FSC | 2,678 | 8/13/12 | $ 0.10 | 24.0 | 257 |
| JQC | 4,717 | 8/13/12 | $ 0.07 | 33.0 | 316 |
| MPC | 575 | 8/14/12 | $ 0.35 | 3.0 | 201 |
| MSFT | 959 | 8/15/12 | $ 0.20 | 6.0 | 192 |
| PRE | 1,023 | 8/17/12 | $ 0.62 | 8.0 | 634 |
| OIBAX | 3,837 | 8/30/12 | $ 0.02 | 12.0 | 81 |
| O | 546 | 8/30/12 | $ 0.15 | 1.0 | 80 |
| KSS | 909 | 9/4/12 | $ 0.32 | 5.0 | 291 |
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