Wait, what? September is over already? How did that happen?
With the kids now back in school (well, OK… virtual school) and my focus on keeping the kids focused on their studies, September absolutely flew by. It was here and gone in a flash!
The Tako family mostly stuck to home and kept to ourselves in September… which I suppose is pretty normal life these days. You know, because of the pandemic.
Thankfully, September still had a few nice weekends we used to clean-up the garden and prepare for fall. This turned into a really fun experience when the kids and I discovered this hoppy little guy hanging-out in our garden…
With some quick action, I was able to capture Mr. Froggy (above) for the kids to check out. He turned into a low-cost “one day” pet for the kids.
(Don’t worry, we eventually returned Mr. Froggy to the “wilds” of our backyard. He was safe and sound.)
Dividend Income In September
Dividend income in September amounted to $14,470. This was our highest monthly dividend income for the year (so far), and we’re quite happy to see the dividend income still flowing into our bank accounts despite the pandemic.
Year-over-year, September dividend income increased 14.6%.
As you can see in the table below, dividend income from our portfolio is quite lumpy. This is expected.
September is typically a big dividend month due to the timing of when we receive dividends from our stocks. Stocks usually pay-out dividends quarterly, so this means most dividend payments tend to be heavily weighted to the months of March, June, September and December.
For the year so far, we’ve collected $45,373 in dividends. Most of our stocks haven’t cut dividends (yet!), and our passive income sources continue to fund our lifestyle.
The year still has 3 months remaining, and I’m not going to put anything past 2020 at this point — Anything could still happen! Dividends could still be cut!
Despite my earlier estimation of poor dividend growth in 2020, I suspect we’ll actually see some dividend growth this year, due to the effects of compounding additional money during market lows.
Household expenses in September totaled $3,198. This was our lowest monthly spending in 2020, and I’m pleased with how we kept expenses low this month.
Here’s the breakdown by expense category:
Grocery spending was $378 in September, one of our lowest food spending months in a long time. Typically our family spends around $500/month on groceries, so it’s good to see these lower cost months once in awhile.
How do we keep the food bill so low?
By avoiding expensive packaged food, and spending carefully to maximize our food dollars (shopping sales, meal planning, etc). Of course, skipping expensive meals-out and cooking at home saves a ton.
This doesn’t mean we’re deprived of a good food however. We eat very well!
Take for example this plate of roasted drumsticks, furikake rice, and pumpkin soup (see my recipe for pumpkin soup). A simple, yet delicious meal!
Often times we take good advantage of food sales. Eggs were on sale in September, and I used the opportunity to whip up some Thai Holy Basil with fried egg. It’s as good as in a Thai restaurant!
Then there was the night we got fancy with a salad, some bacon, and some fried eggs… Gotta eat those sale eggs up! Yum!
Our biggest food splurge of the month was a “sushi night”, which of course we made at home. We prefer to make a kind of sushi called “Temaki” which we roll ourselves (here’s a quick video about how to roll temaki). This was the plate of fixin’s.
The results (when rolled) end-up looking a bit like this:
I’m a big fan of these “build it yourself” style dinners. I thought it would be fun to do a “Burrito bar” one night, and this idea turned out great!
The kids loved picking their own ingredients out, but we still had to help them roll up the final burrito.
Who needs Chipotle when you can build it yourself at home for a fraction of the cost?
Fuel costs amounted to $31 for the month of September. We aren’t driving much this month due to the pandemic, and this is perfectly OK by me.
We spend a lot more time walking or riding bikes around our neighborhood now, which is a great change from driving the car.
As usual, our largest single monthly expense is our mortgage. Recently, our monthly mortgage was adjusted downward to $2357/month, which is approximately $3 less per month than previous months.
Why the change? Our bank realized we had a larger than necessary escrow balance (for property taxes and homeowners insurance). As a result, they reduce our monthly payment.
While we could technically pay off the remaining mortgage at any time, we’ve chosen to retain that money and hunt for better investments. (More on this later)
As in previous months, our internet expense was $45 in September. This is our regular monthly amount, and we’ll pay this same price for the rest of our 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.
In prior months, I skipped over mentioning the cost of what we pay for our mobile phone service… because it’s nonexistent. We paid $0 in September for our mobile phone service.
But I still get readers asking why we don’t include this item in our numbers… so I’m adding it now in all it’s boring glory!
Why is it zero?
Typically we prepay our mobile phone service once a year. This happened back in May of this year, and amounted to $35 for two phones. Yes, that’s our annual amount. Google Voice handles most of our telephony needs for free, so why bother paying more than necessary?
Utilities in September totaled $355. This includes our energy bill ($60) and a ridiculously large water bill ($295). During the summer months our energy usage tends be quite low, but water usage tends to be quite high (as we’re watering the garden and plants in our yard).
This phenomenon reverses in the winter, when energy use rises and water usage drops.
Compared to the rest of the country, our weather is fairly mild (but very wet). This means our utility expenses tend to be fairly affordable throughout the year.
Insurance costs in September were $0. Whenever possible, we try to pay insurance bills for the entire year all in one go, to lower the total cost. For example, our car insurance is paid once per year. Typically in October.
(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.)
The “Other” expense category is something of a catch-all for all the expenses that don’t fit elsewhere. Any expense that doesn’t fit in the other categories I put here. “Other” spending amounted to $31 in September.
Here’s the breakdown of individual expenses:
- $1.20 – USPS postage for a overseas letter.
- $10.45 – A special cleaner for a car MAF sensor.
- $19.64 – A picture frame from Amazon. Nothing too fancy, just a simple frame for part of a gift.
Cumulative Expenses For 2020
For the year so far, the Tako family has spent $29,866. This works out to an average monthly spend of $3,318. With YTD dividends of $45,373, our yearly spending is $15,507 less than our total dividends.
Hey, that’s pretty good! The extra cash means we have some wiggle room in the coming months to either grow expenses or fund additional asset purchases.
Generally speaking, the holidays tend to be a bit more expensive than other months, so I expect our spending levels to increase a bit in November and December.
September 2020 Investing Update
With the markets continuing their wild volatility in September, I sat on our excess cash waiting for good prices to arrive. Mostly that didn’t happen, and the excess cash continued to earn around 0%.
The good news is, I’ve found a stock sector that looks attractive right now. Namely, banks. I think there’s some very good investing opportunities to be had in banks.
Yes, yes, I know… the internet is filled with naysayers trying to tell me I’m going to lose my money AND stock returns from banks are going to stink in the future due to low interest rates. Yes, I got it!
Thankfully, I don’t have to listen to the random opinions of the internet! They can be safely ignored, and I can go about my business compounding money!
In my opinion, some banks will still prosper despite the lower interest rates. The trick is in identifying the unique niche that’s going to do well!
While I haven’t made any purchases yet, I believe I’m getting close to finally putting some of that excess cash to work.
That’s it for September! Thanks for reading folks!
[Image Credit: Flickr1]