You got that right, today I got this great news that i’m getting a raise! How great is that? And the best part is that I did not even had to ask for it! 🙂
Actually the news came yesterday, when Intel announced that they will raise their quarterly dividends from 0,2725$ to 0,3$ which represent a +10% dividend growth YoY. Since we are a proud owners of 17 shares of this wonderful company this raise will bring us additional +1,5 EUR (1,87$) annual dividend income. Sure this is nothing if put it into monthly income which makes just +0,125 EUR/mo. or 0,007% of our average monthly income, buuut hey this is free money! 🙂 Literally free additional money. What is even more great is that this is not my only employer who is willing to give me a pay raise each year! At the moment we own 5 wonderful US companies that raise their dividends each year in our Dividend portfolio and in addition 12 Baltic companies who also pay dividends, but are not that stable and obligated to raise their dividends.
What is even better is that INTC has also announced wonderful Q4 results. Y2017 revenue has increased +9% and EPS has increased by +28% if not taking into account one-off tax expenses for previously not taxed off-shore earnings. This growth on earnings is the force that drives the dividend increase and makes the growth sustainable for decades or even centuries.
What about other companies that we bought lately? Latest dividend increase was announced by T, which increased their dividends from 0,49$ to 0,5% or by +2% in 2017Q2. Since we own 35 shares this increase brought us +1,13 EUR (+1,4$). What is funny the investment is x2 bigfer then INTC and it has brought us fewer income growth, but on the other hand dividends received right now from T (39,4 EUR) is almost 3,5x bigger then what we get from INTC (11,5 EUR). Then we have JNJ which was our first US stock bought back in 2017 mid. Februrary, then in 2017Q2 they raised their dividends from 0,8$ to 0,84% or by +5% and since we own 5 of their shares this bought us additions +0,65 EUR (+0,8$). Other US companies TGT and AEP did not yet increased their dividends after we have bought them. So to sum up we got +3,3 EUR increase of dividend income over the past year. Nothing spectacular, but this is just a start. Next year at least 2 more companies will join the club and maybe few more which will be bought during the year slowly increasing that snowball. Each additional euro counts even if its just +28 ct./mo. or just +0,01% from our income.
This raise has increased our forward dividend income to 352 EUR or 29 EUR/mo. (after TAX) inching little bit forward to our ultimate goal to have sufficient amount of passive income to live off. Since our average expenses amount to 1.713 EUR/mo the progress toward financial independence stands at 1,7% while the L/T goal to reach 500 EUR in dividend income stands at 70%. To reach that mark we would need around 5 kEUR of additional investment into stocks that pays at least 3% of dividends, which is quite hard in this environment, especially when i’m limited to buying high yield REIT’s for now. But everything is doable 🙂