February 2017 Dividend Income And Expenses


Is winter over yet?  I’m SO ready for Winter to be over…but sadly spring is still a long ways off in the Pacific Northwest.

Technically spring is supposed to start in April, along with the Skagit Valley Tulip Festival.  Unfortunately, Old-man winter always takes a lot of convincing to leave.

In my mind, spring really doesn’t get started until May around here.  Usually the snow and freezing rain have stopped by then.

The good news is that we’re finally starting to get a little more light in the day.  Instead of it being dark by 4:30pm, it now gets dark at 5:30pm.  A whole extra hour of daylight to go outside and do stuff!  Woot!

That’s a gain of almost 2 minutes of daylight per day!

But enough about our crappy weather….let’s get on with the numbers!

 

Expenses For February

Expenses in February turned out very reasonable, and lower than we spent in January!  In part, that could be because February is the shortest month of the year.

february 2017 expenses

As with most months, the mortgage and daycare consumed the largest chunk of our expenses at $4405.25.

Outside of mortgage and daycare costs, we only spent $789 for the month of February.  How about them apples?  That’s lower than usual, partly because some bi-monthly utility bills weren’t billed in February.

Food spending was also lower than average too.  We ate the same as previous months, but for whatever reason we came in under $500 in Feb.  

(Don’t worry, I didn’t lose any weight from not eating.  If anything, I ate too much.)

The food spending anomaly was probably just a slight draw-down on the pantry inventory.  More than likely, March will be more expensive to compensate. 🙂

The “Other” category was where the exciting stuff happened this month, with spending of $127.86.  Most of that was money spent at the home center.

February was one of those months where a simple DIY fix turned into a far larger project….twice.

 

DIY Shenanigans

First, I set out to replace some burned out lightbulbs in our bedroom.

Easy fix, right?  They were spotlight-type bulbs that shine downward from the ceiling.  These kinds of lights are usually halogen and burn very hot.  Subsequently they burn-out quickly too.  So I figured, “It’s time to upgrade to LED bulbs and stop this replacement nonsense once and for all!”

Ha!  Famous last words!

Turns-out, the dimmer switches used in our bedroom were not “LED ready”.  The result was LED bulbs that wouldn’t turn off completely with our existing non-LED dimmer switches.

The “fix” was to replace the dimmers with more expensive LED versions (like these).  Argh!!  At $21 each, I should have just purchased the two dimmers off Amazon, instead of bothering with the overprice home center.  Amazon would have been cheaper.  

The LED bulbs weren’t cheap either, at $9 for three LED bulbs.  Overall, the light quality is better, but I would have been better off financially by sticking with inefficient halogen bulbs.

The second major DIY rabbit-hole in February was a drippy bathroom sink Mrs. Tako asked me to fix.

Never having the opportunity to fix a dripping sink faucet before, I watched a bunch of YouTube videos to get the general idea.  

Most of the time when your sink drips, the faucet cartridge has gone bad and needs replacing.  A cheap $7-$10 fix.

“OK, that’s not too hard” …or so I thought.

After popping off the faucet handle, I was able to find the cartridge… but found something else even more concerning:

Rust
Initial investigation of the dripping faucet revealed a far worse problem — RUST!

Rust had eaten away the washers holding the pipe, and water was actually dripping down underneath the sink.  Argh!! More stuff to fix!

Our local home center didn’t have the necessary parts, and I had no idea what brand of faucet it was.  There was no name or serial number printed anywhere on the sink.  It was an interesting mystery to solve…

The faucet cartridge ended-up being the key to tracking down the necessary parts.  There are literally dozens of different kinds of faucet cartridges in use today, and every manufacturer uses a different style.  I found what looked like a matching replacement cartridge online — it was a Price Pfister branded cartridge.  From there, I started looking through the list of faucets.  A few minutes of research revealed we had a Treviso widespread bathroom faucet.

This is where my luck improved.  Upon calling the Pfister replacement parts department, I learned the faucet had a lifetime warranty.  They shipped me all the replacement parts for free.

Other than my over priced adventures in DIY home repair, the other category did have some “fun” expenses.  Tako Jr. #1 went to his very first movie in the theater!  I took him to see the new Lego Batman movie.

When did movie theaters get so expensive?  Tickets for the two of us cost $21.35.

Lego batman
Tako Jr. #1 ready to go see the Lego Batman movie. His first movie in the theater!

Tako Jr. #1 was nervous at first, but we made it through the whole movie without a major incident.  On the way home he threw a huge tantrum though.  I guess he was tired from the long movie.

 

Dividends For February

Dividends for February were pretty much non-existent…

February 2017 monthly dividends

The small income earned in February was interest earned on our uninvested cash.

While the small income in February was a little disappointing, that’s just how the investment income game works.  Most investments pay out once a quarter.  I expect a much higher dividend income (around $8k) in March, like we saw in December.  

For the year so far, dividends totaled to $4,131:

February 2017 annual dividends

It’s too early in the year to make any calls about our dividend income, but my goal is to grow our dividend income by 10% in 2017 — half from dividend increases and half from investing new capital.

I’d like to hit $53k in dividends this year.

So far, only one of our holdings has announced a dividend increase this year (it was a 10% increase), but I’m expecting most of those announcements will happen in the second quarter.

 

Portfolio Changes For February

Just like January, we made no portfolio changes to speak of in February.  To my eyes, most investments look very expensive right now with the S&P 500 PE at 26.58.  That means the S&P 500 has a tiny 3.76% earnings yield, and a real earnings growth rate of -2.8%.

That’s not really a situation I want to invest my money into.  With the Federal Reserve looking to raise interest rates several times in 2017, I expect some of this unbridled stock market enthusiasm will begin to calm down throughout the year.  Mr. Market is in a really good mood right now, but I doubt it will last.

I’m in no hurry to invest excess cash right now, despite the fact that I want to grow our dividend income this year.  For me, capital preservation takes precedence over chasing income.

That said, I haven’t been ignoring our investment portfolio either.  I’ve been researching different ETF’s, airline stocks, and even dividend growth stocks.  None of them have (yet) shown me the right numbers that would make me pull the investing-trigger.

Recently, I’ve been considering several stocks for possible inclusion into our portfolio — IBM, UPS, and AMGN.  All three fit many of my investing criteria, but none just “nail it”.

I’ve been on the fence about IBM for a long time, and haven’t purchased any shares.  But, as I keep learning more about their business, I’m beginning see some long-term positives.  I might just finally pull the trigger on it one day.

UPS and AMGN are new investment ideas for me, but I’m still in research mode.  Both investments are slow growing companies, and both look a little expensive given their respective industries and metrics.  Are they leaders in their industry?  Do they have competitive advantages?  Are their returns on capital higher than average?  There’s lots of questions to answer.

For now, I’m content to sit on the sidelines and continue reading.


15 thoughts on “February 2017 Dividend Income And Expenses

  • March 7, 2017 at 8:57 PM
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    I hope you find some good stocks to put your capital into. I’ve been keeping an eye on XOM to add to my portfolio, and it’s getting down to the levels that look attractive to me.

    PS- you have a typo in your post: 2 more hours of daylight, not minutes. And yes, that makes a huge difference. In mid summer you should have at least another 3-4 more hours making the dark winter more worth it. It all evens out.

    -Mike

    Reply
    • March 8, 2017 at 8:07 AM
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      I believe he was saying two additional minutes of sunlight per day, so 14 additional minutes of sunlight each week.

      Reply
  • March 8, 2017 at 5:03 AM
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    Love reading your blog, keep it up. Something interesting to add to your evaluation of IBM. In one of my MA program classes we were evaluating the technology S-Curve and we used IBM as our case study. The idea is that micro processing speed is reaching its limits, therefore, IBM may be in a situation where they may not be able to continue improving on speed and will need to find or identify an alternative technology to augment the limitations of the current.

    Just something I just learned and thought I share it since you were looking into IBM. We didnt evaluate IBM from a financial aspect.

    Also just curious, what is your total portfolio size (invested dollars). Im running numbers on my end and was just getting different figures so I can come up with my personal goals.

    Thanks
    Nadeem

    Reply
  • March 8, 2017 at 6:11 AM
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    Brrr, it sounds bitterly cold in your ‘hood. It’s in the 80s here and we didn’t get much of a winter, which means our summer is going to be overrun with bugs. Ugh. And at least sunset here is around 6:30, but it’s still sucky when you want to work outside. At least DST is this weekend.

    And hey, your February expenses are awesome! We’re trying to get our own costs down that low. Our “Other” spending was $1,000 in February–oops.

    Ugh, sorry to hear about the LED issues. I know dimmers and LEDs don’t always get along.

    Reply
    • March 8, 2017 at 10:58 AM
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      In the 80’s….argh! Don’t tease me!

      I thought my “other” spending was bad at $127 this month…but I think you take the prize there Mrs. PP!

      Thanks for the DST reminder!

      Reply
  • March 8, 2017 at 10:22 AM
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    What internet provider do you use? Would you recommend them?

    I’m paying almost double for mine in Seattle.

    Thanks!

    Reply
  • March 8, 2017 at 12:11 PM
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    Are you on a 12 month promotion plan with Comcast?

    I just contracted them and they said after the year promotion the price increases to $65.

    Are you going to shop around again after that?

    Reply
    • March 8, 2017 at 12:30 PM
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      Yeah, I think it was some kind of 12 month deal…and yes when the 12 months is ‘up’ I’ll check around for other deals.

      Reply
  • March 9, 2017 at 12:17 AM
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    Looks like your February expenses went quite well, keep up the great work, Mr. Tako!

    I think Amgen is in the top 10 within the pharmaceuticals industry right now and is growing even more. If I remember correctly, Johnson and Johnson or Pfizer was number 1 when I was working in the pharmaceuticals industry. You might want to take a look at Shire, Abbot/AbbVie, Illumina, Merck, Gilead, and Novartis as well as they are big names and the “target” companies people in the pharma industry would shoot for (just like Google, Facebook, etc for computer science majors). Too bad this is only from an industry/working perspective, as I’m not that experienced with analyzing stocks.
    Smart Provisions recently posted…Net Worth Report: February 2017 Edition

    Reply
  • March 9, 2017 at 6:31 AM
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    This winter has been the worst in 20+ years I’ve been in Portland. We usually get a few nice warmer breaks by now, but it’s been cold and rainy/snowy this whole winter. Really terrible. Makes me want to move.
    Good job with DIY. I replaced a few kitchen faucets, but haven’t had to deal with the bathroom yet. Seems more complicated. I never even heard of a faucet cartridge.

    Reply
  • March 10, 2017 at 10:02 PM
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    Markets are on a tear right now because they have all the trump taxes cuts baked in. Who knows if it’ll actually happen. All I know is at any given point in time, either a) market is overvalued or b) markets are crashing and it’s too scary to invest. There is no such thing is “seems like a perfect time! Let’s jump right in!” Since I’m investing for the long term, I don’t bother timing the market.

    How was the Lego Batman movie? I heard it was really funny?

    Reply
    • March 11, 2017 at 3:48 AM
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      Try not thinking about it as “timing the market”. Think about it as trying to make a smart investment. It doesn’t take a business genius to understand that high prices mean lower long term returns.

      As far as the movie goes, yeah it was pretty funny. My son didn’t get most of the jokes, but he enjoyed it all the same.

      Reply

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