“It was the best of times, and it was the worst of times”… as the saying goes. July fit this description quite accurately. Much of July was a very good month, but we had to deal with some costly equipment failures and a health scare. It was a difficult month for my mental health.
These obstacles put a damper on our family summer activities, but we did our best to put them behind us and still make the best of our summer. While the kids are out of school, I’m doing my best to keep them active, entertained, and learning.
We do a lot of hiking these days…
And now that summer temperatures are finally warming up the Pacific Northwest, we’re spending more time at our local beaches keeping cool. My boys have discovered the endless joy of throwing rocks into the ocean…
They can literally spend hours at the beach throwing rocks into the water… which is not a bad way to spend the summer I guess. The simple joys in life are best.
Dividend Income In July
Dividend income in July totaled $704. It was a very unexciting month for dividends, but that’s OK … not every month needs to be a dividend blowout. As you can see in the table below, July was a low dividend month.
Stocks mostly pay-out dividends quarterly, so this means most dividend payments are heavily weighted to the months of March, June, September and December.
For the year so far, we’ve collected $30,899 in dividends. At this time, most of our stocks haven’t cut dividends due to the pandemic, and we’re doing well on the passive income front.
Despite my earlier estimation of poor dividend growth in 2020, I think we’ll do OK due to the effects of compounding. We invested money during the March 2020 market lows, so we’re seeing decent dividend growth from that.
Our strategy is simple enough — Continue to compound dollars when the good opportunities present themselves, and collect the growing rewards. Rinse and repeat year after year, and watch the dividends grow.
Household expenses in June totaled $3,781, which was higher than we anticipated. Partly this higher total spending was due to some unexpected tech failures, but we also invested in some home improvements (paint and new door hardware), and did some stocking up at the grocery store.
Here’s the breakdown by expense category:
Grocery spending in July was high at $709. We spent more than normal in July, primarily because we did some stocking up at Costco for household supplies (toilet paper, toothpaste, and that sort of thing). It was an expensive month for groceries, but we did eat very very well.
We ate a lot of green salads in July, which made for some very healthy meals.
But fancier meals did hit the table occasionally — Like the night we ate teriyaki salmon and sushi…
My world famous fish chowder also made a tasty appearance in July! While the outside temperatures are a bit warm for chowder, my recipe is so good I never get any complaints.
Probably my favorite meal of the month was one of the meals I didn’t actually make. The kids decided they wanted to make dinner one evening, and prepared this wonderful meal of Tori-niku dango (chicken meatballs) and garlic oyster-sauce asparagus along with furikake rice. It was delicious!
As usual, our largest single monthly expense is the mortgage on our home. The mortgage amounts to $2360 every month, and does include all the extra expenses like property taxes and homeowners insurance.
While we could technically pay off our remaining mortgage at any time, we’ve chosen to retain that money and hunt for better investments.
Childcare was $0 this month, as it has been during the entire pandemic. Some childcare facilities have begun to re-open, I’ve elected to keep both kids home with me during the summer.
Yep, I’m taking care of the kids full-time now! It can be quite entertaining at times, but also pretty tiring. Having my kids around all the time could make anyone go crazy…
As in previous months, our internet expense was $45 in July. This is our regular monthly amount, and we’ll pay this same price for the rest of the annual contract.
For the curious, we pay for 100Mbps cable internet from Comcast (XFinity) with 5Mbps upload speeds. It might not be the fasted package out there, but it’s more than sufficient for our needs.
Utilities in July were $315. This includes our electricity and natural gas bill ($66) and our water bill ($255) for the month. During the summer months our energy usage tends to go down, but water usage goes up. It’s sort of a yin-and-yang utility bill situation that keeps the monthly expense fairly consistent.
Summer is also quite cool here in the Pacific Northwest so we generally don’t need air conditioning. In fact, our home doesn’t even have air conditioning. This keeps our summer electricity bill quite affordable.
Insurance costs in July were $0. Whenever possible, we try to pay our insurance bills for the entire year all in one go, to lower the total cost. For example, our car insurance is paid only once per year.
(For the curious: We do have home-owners insurance. It’s included in our mortgage. Call me lazy, but I don’t normally break that number out here in the insurance section.)
Other spending amounted to $252 in July. This “Other” category is a catch-all for all the expenses that don’t fit elsewhere.
Our “Other” category broke down like this in July:
- $64 – New Raspberry Pi 4 media player (discussed in this post).
- $138 – Paint, brushes, and new door hardware from Home Depot.
- $50 – Various small purchases from Amazon.
Cumulative Expenses For 2020
For the year so far, the Tako family has spent $23,120. This works out to an average spend of $3,302 per month. Total spending is roughly $7,700 less than our total dividends for the year. That’s great news! Exactly where we want to be.
Outside of our mortgage, core spending remains very low — typically between $950 and $1500 every month. If this trend continues, we’ll have plenty of excess cash to keep compounding in 2020!
It’s been a affordable summer so far, with most of our annual vacation plans canceled due to the pandemic. Instead of air travel, we’ve been traveling a lot more locally this year. It’s been a lot of fun to see a few new sites and sounds that Washington state has to offer.
That said, we did have an uptick in spending in July (and it will continue again in August) due to the aforementioned unexpected technology failures. I don’t expect any more expensive failures, but you never know… stuff breaks all the time.
July 2020 Investing Update
On the investing front, July was a pretty dull month. Second quarter earnings releases weren’t out yet, and I was not about to buy stocks without knowing the full extent of the Q2 earnings disaster.
Stock prices were also considerably higher than what was experienced in March, so I avoided buying shares in July. Too expensive for my blood!
Likewise, I’ve avoided writing any new options since the pandemic began — primarily because of the large amount of volatility and unpredictable nature of the pandemic.
Call me crazy, but I like to invest knowing I have a good probability of a return. Investing during a global pandemic is a bit like playing a card game where you don’t know the rules. It’s a sure-fire way to lose!
Games like this are best avoided by sensible investors, and that’s exactly what I did in July!
[Image Credit: Flickr]