Wow, what a difference a month makes! This time last month, the Tako family was buried under a veritable mountain of snow. Now, one month later, spring has definitely sprung.
Temperatures are warmer, and there’s more natural light due to the annual daylight savings time shift. This has made a huge difference in how much daylight we have, and I find myself itching to get yard-work done and prep the bbq for grilling season.
(In case you didn’t know, I love to grill outdoors!)
Just having that little bit of extra sunlight creates a vast improvement in our quality of life. This really underscores one of the main reasons why we plan to move away from the Pacific Northwest. It’s more than just about finances. Quality of life plays a huge part.
For now anyway, let’s dig into the finances!
Dividend Income In March
Dividend income in March amounted to $11,161. March is always a big dividend income month for us. That’s just how quarterly dividend payments from our assets “land” in the account. March, June, September, and December always end-up being big dividend months.
While some people attempt to smooth dividend income month-to-month by investing in stocks that pay-out monthly, or by using “extreme diversification”. I simply choose to let the dividends remain lumpy. It works well for us, but it does mean we need to carry a slightly larger cash pile to cover low-dividend months. (Having a little extra cash on-hand isn’t a problem right now.)
For the year so far, we’ve collected $13,883 in dividends. This is $1,607 ahead of where we were last year at the end of March. We really hit it out of the park in March, and I’m fairly pleased with our dividend income so far. At this rate, we should be able to reach our 2018 dividend growth goals.
Expenses in March amounted to $4,860. This was a fairly average spending month for us, and included a few “Other” expenses we wouldn’t normally have. (More on this later.)
Last month I vaguely promised we’d increase our monthly food spending so as not to seem so miserly. Well, you’ll be glad to know that we spent $490 on food in March. That’s an increase of $37 from February. Woah big spender! I need to take it easy!
As usual, we ate well despite spending not a whole lot. Mainly this is because we cook most of our meals at home, but this doesn’t mean we skimp on ingredients, or eat terrible food. In fact, most of the time it feels like we’re splurging on food.
Take for example this delicious shrimp pho…
You can’t even see the noodles in that picture! It’s buried under the shrimp somewhere. Clearly I could have used less shrimp (or even a cheaper protein), but I decided to splurge a little.
We do eat more frugal fair as well. For example, when I have a bunch of odds and ends in the refrigerator, one of my favorite go-to recipes is fried rice.
It’s a great way to cleanup leftover rice and “miscellaneous” items from the kitchen AND produce a delicious dinner. Waste not, want not!
In March we also made homemade gyoza. This dish requires a lot of manual work (preparing and wrapping), so we don’t do it frequently, but the results always taste awesome.
Of course, this couldn’t be a Mr. Tako Escapes monthly update without a few taco pictures. (Don’t worry I didn’t forget!) As usual, delicious homemade tacos made an appearance on our table. The first here is a fish taco with homemade guacamole…
The second is a chili-lime shrimp taco which includes the same homemade guacamole and a fresh homemade salsa. Did I mention I love tacos?
Japanese-style mapo tofu was another family favorite we made in March. It’s a fairly easy recipe to make and the just kids love it, frequently asking for second helpings.
Other Japanese cuisine in March included this teriyaki chicken we had one night…
It’s a little different than your typical strip-mall teriyaki, but we like it.
As you’ve probably noticed from the pictures we don’t eat a lot of red meat. That’s intentional, and we didn’t eat beef once in March. Chicken, tofu, eggs, beans, and shrimp tend to be our go-to proteins of choice. We generally try to eat a higher percentage of our diet in vegetables rather than protein heavy meals.
Salad nights happen at least once a week, but they don’t make for quite as exiting photos.
In March, we spent $60 on fuel. That’s about two fill-ups for the car. This reflects an increase in driving we did after all the snow melted, but generally we didn’t drive a whole lot.
Whenever possible, I try to walk or time my driving to happen when there’s the least amount of traffic on the streets. We’ve done a pretty good job this year keeping our fuel expenses low.
Mortgage And Childcare
As usual, monthly mortgage and childcare expenses were our two largest expenses in March. Combined, these two items totaled $3694.
Unlike many families however, these expenses are entirely optional for us. Using spare cash I could easily pay-off the mortgage. If I wanted to, I could take our youngest son (Tako Jr. #2) out of daycare, and trim that cost too.
Those actions would completely eliminate our two largest expenses, but I would no longer have all that spare cash to invest, and no time to blog either. On top of that, Tako Jr. #2 would be missing out on his language immersive daycare (The daycare is completely non-English).
We’ve decided to keep these expenses for the time being.
It should come as no surprise that our internet bill was $0 again in March. For the last 10 months our internet bill has shown up here as $0 because we pre-paid our internet expenses way back in May of 2018.
This no-bill business will finally end next month. We’ll see a new cable internet bill in the next monthly update.
For the curious — Our internet service is 60Mbps down and 5 Mbps up cable internet. That’s plenty fast for our needs, and it normally costs $49.95/month.
Utilities in March amounted $394, which is fairly high for us. This included a bi-monthly water bill at $240 and a energy bill of $154. This fairly large energy bill I attribute to the very cold and snowy winter weather we had in February. We needed to burn a lot of natural gas to stay warm this winter!
Our monthly insurance bill totaled $0 again in March. Whenever possible, we try to pay insurance premiums for the entire year all in one go. Our car insurance (for example) is paid once per year. This is always a large expense, but most insurance companies give-out a discount for paying it all upfront — so it’s actually cheaper to do it this way.
Our last big insurance bill was back in October 2018 when we paid our annual car insurance bill.
Other expenses in March amounted to $221. This is a fairly large amount of “Other” spending for the Tako family, so it needs a little explanation. This amount included the following items:
- $22 Airfare expenses for our upcoming summer trip to Texas.
- $115 H&R Block tax prep software. (This is a HUGE price increase over last year. Boo!)
- $55 Sushi dinner out with friends.
- $28 Lego set for Tako Jr. #1’s birthday.
Yep, it was a spendy March! We even ate out at a restaurant!
Cumulative Expenses For 2019
For the year so far, we’ve spent $13,981. Outside of our mortgage and childcare, this means we’ve spent $3252 in 2019. I wish we could do a little better, but I don’t want to cut things to “the bone”. In my mind, it’s better to be frugal and not feel deprived instead of being extremely frugal and feeling deprived of a good life.
Personally, I’m just happy that our expenses for the first quarter were completely covered by our dividend income. It’s a goal of mine to keep our expenses in this “happy place”.
Opinions on our frugality may differ, but it is personal finance after all. I’m not comparing myself to anyone, but I try to keep our expenses low.
March Investing Updates
Oh boy, there is lots to talk about on the investing front this month! We made some changes to our portfolio in March, which have been a long time in the making.
The first move, was selling 800 shares of DowDupont. Despite making capital gains of around 20% and annual dividends of about 3% annually, I was unhappy with this investment. Yes, we made money. Yes we did OK, but this investment failed my compounding test (which I require for holding stocks long term). During the time we held the stock, management was unable to compound value for shareholders in the form of cash flow per share increases, dividend increases, or most other methods of valuing a business. Frankly I’ve held this view for a couple years, and have been waiting for the opportunity to sell.
So why did I sell right before the spin-off of Dow from DowDupont? Mostly to save myself from paying additional fees when selling. Also, I’m not convinced that splitting apart the two businesses is really going to create additional value for shareholders over the long term.
(Note: Spin-offs are historically known as ‘value creating’ because investors will typically pay a higher multiple for the individual parts. This does not mean the spin-off will become a more efficient business separated from the conglomerated. Frequently the opposite is true, as the now smaller company has to swallow the additional costs of being a public corporation.)
Will I miss out on a few gains from selling before the spin-off? Maybe! After several years of watching DWDP, I was fed up. Management had plenty of retained earnings and healthy business margins which they could have compounded. From what I can tell, they didn’t! I decided to finally dumped the investment in March.
The second big move of the month, was putting spare cash into the purchase of 700 shares of Discover Financial Services (Symbol: DFS), and 110 shares of LyondellBasell Industries (Symbol: LYB). This resulted in net new cash invested of $16,991 in March.
Both stocks I’ve been buying for awhile now because I believe they’re above average businesses selling at below average prices. In some cases you could even argue they’re selling for absurdly cheap prices, but I choose to take a more nuanced view (remembering the potential for multiple possible outcomes)
The third big move in March was selling put options on 3 stocks I desire to accumulate more shares of. (Two of which are discussed above.) This option writing is just a little experiment on my part. I don’t claim to have any special option trading expertise, but I can see a bet with a high probability of winning when it’s put in front of me. Income from selling these options amounted $1,289, which I hope to pocket in a few weeks when those options expire.
Should the owner of the options decide to execute the put, I’ll happily buy shares in the 3 companies I wrote options against. This will have the net effect of considerably lowering my overall cost basis, which is positive for a long-term owner like myself.
That’s it for March! I’ll do another one of these monthly updates next month!
[Image Credit: Flickr]