April 2017: Dividend Account Activity

The Exceptional Fund has started to bloom

Greetings to all and happy Spring!

April was another good month in the sense that I was able to stick to my 12 Month Savings Plan.

Initially, I was worried that as a result of a less-than-anticipated tax return, I would not be able to cover my expenses while meeting my savings goals.

However, this has proved not to be the case - so far.

April was also a very busy month.  I am now just two short weeks away from finishing up graduate school, and other than a thesis presentation and final exams, I am basically done and will have a little more time on my hands - and a tuition loan debt to begin to pay off.  

Month At A Glance:

In terms of account activity, April was fairly quiet, as to be expected. One of the positive takeaways when reviewing the month was the amount of dividend income that came in.  

As a result, I can report that:
  • I earned $93.48 in dividend income this month.
  • The projected annual dividend income of the dividend fund increased from $658.60 to $666.53, a 1.2% increase. 
  • The fund value increased from $15,446.70 to $15,785.34, a 2.19% increase.
  • I continued to make weekly $100 contributions to the dividend fund on Mondays through automatic investment.
  • I was able to invest an additional $210 in new money from chaperoning school events, bringing my total invested this month to $610.  
  • I purchased 12 shares of VEREIT REIT (VER) via the Flexible Reinvestment Program (FRIP) at Scottrade.  

Progress Toward Goals

My primary goal is to save $10,000 in this, the first year of the Exceptional Fund.  As of this update, I have saved $4590, which of course is 45.9% of my goal.  As of this writing we are 32% of the way through the year, and so therefore I am ahead of pace to meet that goal.  

Additionally, as the coach of a fall sport, I will have extra income split between two checks in October and November, which equates to about one month of my regular salary, giving me in effect two extra paychecks for the year as opposed to my traditional ten months of pay split into twenty paychecks.  

With that extra income, I will either bump up my savings to launch well past my goal, or stick in it a bank savings account to be the core of my "summer fund" to cover two summer mortgage payments.  

I will likely take that approach, as I am going in another direction, leaving the summer job that I have had for the past eight years as a swim club manager to work in the district summer school program.

While the change is summer jobs this year will result in a significant decrease in summer income, the resulting movement on my school salary guide in September due to another degree will offset those the decrease and allow me to work far fewer hours this summer.

My secondary goal is to maintain 52 weeks of automatic investment of $100 per week for 2017.  Through four months, I have been able to do this and at this time I am considering giving myself a small "raise."

The third and final goal that I set for myself was to try to reach the $1000 mark in projected annual dividend income. 

However, I have always felt that this was more of a guideline to aim for but not a direct goal that I am compelled to reach. To hit this mark in 2017, I would have to invest in more speculative stocks with outsized dividend yields.

While I do have a somewhat speculative play with a small position in VEREIT REIT (VER), my focus will remain on building a solid base for this fund to allow me to sleep well at night for years to come.

Building the core of this fund will be a process that will last beyond 2017, and while setting a high bar in terms of goal setting is motivating, it is not necessarily in my best interest. There may be a time when this account is much more fully funded where I can make a few reaches, but that time is not even on the distant horizon.

Additionally, $1000 is an arbitrary and generally meaningless number.  But it is a round number, and we all tend to like round numbers.  They are easy to work with.  I am guilty of this as much as anyone.  It irks me, for example, that I have 39 shares of W.P. Carey Inc. (WPC) instead of an even 40, although there really no difference between the two.

So while I am eager to hit annual dividend income targets, I realize that it is the process that is more important - perhaps more important even than goal setting.  

In setting up that process - my savings plan - and seeing it through, I take satisfaction that I am able to maintain savings discipline and engage in reflective activities such as sharing my ideas and plan with the dividend growth community for feedback and guidance from you veterans.

With that, I hope you have had a successful month and invite you to email me at dividism@gmail.com or to leave a comment in the field below.  

Brian @ Dividism


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