November 2016 Dividend Income And Expenses
It’s time once again for a Tako family monthly income and expense report! November was a month for indoor activities, like finishing woodworking projects. We spend a lot more time indoors this time of year…and subsequently, our spending for November was very …err… typical.
A “steady as she goes Captain” kind of month.
Expenses For November
The good ship Tako had expenses for November total $5034.28. As I mentioned last month, our daycare costs have increased — Now we’re sending the youngest a few times a week. It caused a big spike in our spending. You can see it in the monthly expense breakout here:
See what I mean about typical? — This was an unexciting month from an expense perspective. We kept our food costs down by not stuffing our faces, and most of our utility bills didn’t bite in November! (Some months are like that because many of our utilities send bills either bi-monthly or tri-monthly. I guess that cuts down on their billing costs.)
Our Thanksgiving “feast” looked delicious. I didn’t eat any of course. 🙁
Outside of childcare costs (which are optional), our core expenses were only $2899.28. That’s fairly low, and it includes the mortgage!
Next month should end-up being a higher-cost month as more utility bills land. That, and we’ll have some additional holiday spending to account for. Usually we end up eating some fancier meals in December. We splurge a little bit with family on things like dungeness crab or fancy sushi dinners.
On an annual basis, our 2016 expenses totaled $49 thousand dollars… and there’s still one month left of 2016! Originally when I projected 2016 expenses for the year, I estimated about $48k.
Yikes! I was WAY off! We’ve now exceeded my projections, and still have an entire month to go! By the end of December our annual expenses will probably reach $55k.
So how did we do income-wise?
Dividends For November
November had to have been the most unexciting dividend month we’ve seen in a long time. We had no dividends paid in the month of November! This is the first time it’s happened in 2016!
So for everyone out there looking for a big fat dividend payment this month — Sorry! Most companies only pay out dividends quarterly, and in our case, this resulted in nothing for November.
We did have a little interest income from our money market funds, so I’ll include that tiny amount of income here:
I guess $25 is better than a big fat zero!
For the entire year, our annual dividend numbers are looking much healthier.
When I look at table it makes me both sad and happy….Sad because we won’t meet our original goal of living completely off dividends. I have to take responsibility for that…I didn’t manage to get enough of our excess cash invested and our dividend income is lagging behind where I wanted to be.
But I’m also Happy because $39k in November is nothing to sneeze at!
December promises to be a really big dividend month…probably pretty similar to what we saw in September. That means dividends will exceed $7,000 and put our annual dividend income total close to $46k!
November Portfolio Changes
Gosh, after those lame dividend and expense reports, I’m wishing I had at least *something* exciting to report in this section for November!
Unfortunately, I don’t!
With the election happening, and the Trump rally/Santa Claus rally following closely behind, I decided to wait things out and made no changes to the portfolio.
In my opinion, markets were already quite expensive before the big rallies, and now even more so. The S&P 500 earnings yield is now 3.9%, and the PE ratio is over 25. Meanwhile the 10 year Real Interest Rate is only 0.44%. That feels really expensive to me.
I’m going to wait until Santa Claus has finished his run this year, then I’ll start investing excess cash again in 2017. Usually by that time, all that bonus money will have been spent or invested back into the market. Sanity should prevail…or perhaps a little sobriety.
On the bright side, our net worth also reached new highs. While I’ll wait until 2017 to report the official number, I can already tell you we’re getting close to a total net worth of $2.5 million. That’s a big increase from our 2015 total.
Next stop — $3 million!
[Image Credit: Flikr]
Very cool and informative! How much are you targeting to save for retirement? It seems like you would have your expenses covered just off of the dividends if it wasn’t for the childcare which is also our #1 expense!
Our “comfort budget” is roughly $60k per year (but that was before these new daycare expenses). Right now, we have big childcare expenses, but those will disappear eventually. Then we’ll travel more instead.
I’d like dividends to cover our expenses in “retirement” and then leave the capital appreciation for portfolio growth. Basically, live off the 3% rule I argue for on this site. Working backwards, that means $2 million.
If I *had* managed to get all of our cash invested, dividends would have been closer to $54k. My expectation is that we’ll grow the portfolio at rates that exceed inflation and dividends will follow suite.
Once we start dipping into things like 401k’s, IRA’s and SS we’ll probably have more than enough.
You never know if this will be the top or not. Back in 2013 people also thought we’d hit a high, and yet here we are much higher. Honestly I’d recommend just sticking to your normal investing schedule. Studies tend to show that is better n the long run.
Maybe. Be careful what studies you believe!
Interesting that you received no dividend income. I guess you don’t own any monthly dividend payers. 🙁
But $25 from interests is better than nothing. But just $1,000 shy of $40k, your dividend income is pretty solid for this year!
Thanks Tawcan! Yep, no monthly dividend payers. We should hit around $47k for the entire year!
You’re very close to live completely from dividends, so nothing to be sad about. I think these numbers can be very encouraging for everyone who just started (or still thinking about) dividend investing.
From my side I track my dividend income on a quarterly basis in order to avoid a disappointing result in months when most of my holdings don’t pay dividend.
Another great month. Our spending is coming back down now as well. We are spending more time at home, indoors, putting logs on the fire. With many of the outdoor activities on hold, it is a nice time to play with new recipes and make some tasty food. I like the look of Mrs. Tako’s Thanksgiving dinner, that must have been torture!
It was torture!
I’m jealous of your internet expense! Ours is double what you pay! What provider do you use? We use Time Warner/Spectrum and it always feels like highway robbery.
Aghh, curse daycare costs! But I’m sure it’s going to be worth it in the end. 🙂 That probably accounts for the annual budget overage, no?
Yep, that’s the big killer. Without those costs, we’d be well in the green.
Our big provider in this area is Comcast. They’re dirty rotten highway robbers too! It’s a cheap/slow internet connection, but it’s enough for our needs.
Looking good! We’re holding excess cash too. I haven’t had time to research and things just seems expensive at this point. What do you think about REITs now?
Good luck with $2.5M next year. I have a feeling it is going to be a bumpy ride over the next few years.
Yum… Dungeness crab.. I’ll check our local Asian seafood store the next time we drive by.
REITs tend to be very interest rate sensitive because of their large amounts of borrowed capital….a bit like a bond (in a way). In a rising interest rate environment (and the fed is definitely hinting), REIT earnings growth might be a little challenged.
That doesn’t preclude buying REITs, but growth estimates might need to be conservative.
$39k so far with more still to come. What a wonderful year Mr. Tako. Well done, sir.
Thanks Mrs. BITA!
Just $25? Wow, talking about a slow month on the dividend front. Before reading the remainder of the post, I already figured December was going to be nice, low and behold, you pretty much confirmed that later on in the post.
Still, at the end of the year, there is only about $10K between income and expenses. Based on your wealth, that’s just peanuts.
Very curious to see where you will end for 2016. But your net worth wil be many multiples of what we have been able to scratch together. If only we would have smarter when we were younger……such is life!
Have a great weekend!
I’ll publish our net worth some time in early January. It’ll depend upon the markets, but right now it’s in the green!
Just keep saving and investing consistently…eventually it’ll grow into big nubmers! I looked up one day and we were worth a million. A few years later it had doubled into two million. We saved from 10k to 119k per year for over a decade to do this.
Don’t get discouraged and try to always make forward progress, no matter how small!
Thanks for the pep talk, needed one 😉
Not bad. Distributions nearly cover the full budget. Very FIRE ready.
Get ready for December to come flying in. Can’t wait to read about your income figures to see how well you finish off the year. Should be exciting. On a side note, childcare costs are crazy and it is nuts that it makes up such a large percent of your income. It is impressive how you are able to keep your other costs down so low!
Looking forward to see what happens next for you.
Bert, One of the Dividend Diplomats
Thanks Bert! Looking forward to it myself!
Hello Mr. Tako,
I discovered your blog for me!
Even if the november income was not so good it is amazing how much dividend income you earn on an annual basis! This is awesome.
keep it up!
best regards from Austria
Chri
Did you plan out your dividend purchases to smooth out how much you receive each month? If so, do most DGI folks do this? So many variables to consider, but lordy I’m impressed at your numbers.
Nope, I don’t bother smoothing income in the least. We do maintain a significant cash buffer however to deal with dry months.