Five years ago I had yet to receive my first dividend payment, so this just shows what a little time and patience can achieve!
See also: Dividend Income
Eventually, the aim is to use the dividend income to pay some household bills. Things like council tax, or water rates. That’s when passive income really takes over. We are such a long way off this! To pay fixed expenses each month from passive income would be amazing. To be able to pay for things that we have no control over, such as our council tax or the water rates, by using dividend income would take the pressure off other areas of money. One day, I am hoping to say we can do this! In fact, I’m sure we will be able to at some point, if we continue on the same path. It will be so exciting when we get to pay our fixed expenses with passive income. That’s the dream, right there In fact, I am aiming to have £1,000 a month on average to ensure this. Of course, some months pay out more than others but an average of £1,000 a month would be great.
The dividend income received in April is small, which is consistent with previous years. There are always going to be swings in terms of how much income is produced by dividends, just because different holdings pay out at different times. Slow and steady wins the race. I am never going to be able to invest huge amounts, so this is something that will take time. We will get there! I provide up-to-the-minute updates over on my Patreon so make sure you join me over there.
Dividends received in April:
GlaxpSmithKline – £31.05
Jupiter Global Managed Fund: £16.60
Total: £47.65
So, as expected – quite small. This would cover both of our mobile phone bills so that’s something I suppose. That’s the long term aim! At the moment, all dividend income received is reinvested. Because my holdings are within my stocks and shares ISA with Hargreaves Lansdown, I don’t pay any tax on them either.
As I wrote about the effect of the magic snowball, mine is beginning to move slightly. By reinvesting the dividends, it’ll only create more income. I believe that continuing to live a frugal lifestyle and save as we go along will see us right in the end. I hope this is inspiring someone else to begin their frugal journey. If we can do it, anyone can! We are not depriving ourselves of anything, just making purposeful choices and it’s beginning to pay off. Literally!
My dividend income aim for 2020 is £1,600 received. As of now, I feel like this is a massive aim for us; it’ll be tricky to reach but I am going to continue to invest with my strategy and hope. To get that means an average of £133 a month, which as you can see I’m a long way off! At the end of the fourth month I’m up to £199.74 so very much a long way to go! In fact, I don’t think I shall hit my aim this year but it was set back at the start of January when things looked very different. I am going to try and continue my strategy and see what happens longer term. Here’s a visual look at my dividend income for the past four years, with 2020 being added as the red line:
The growth should continue going up in an ideal world but I just can’t say at this point; I will continue with my investment strategy and just see what happens over the next few months. I’m in it for the long haul so things should even out – hopefully! I do know that some months going forward will be drastically lower 🙁 I provide up-to-the-minute updates over on my Patreon so make sure you join me over there.
Have you received any dividends this month? Thanks for reading!
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Just found your blog and watched a couple of your videos as I have just recently started my own dividend portfolio.
I too use Hargreaves Lansdowne, and have set the rule that I will only buy stocks in blocks of £500 or £1000 due to the £11.95 fee HL charges. Obviously this means saving until I can make a purchase.
Do you have a minimum amount you buy in to reduce the impact of the fee?
Do you worry about the high fees they charge on funds?
Hope you don’t mind me asking.
Regards
Anthony
PS really enjoy your work and have subscribed for further videos
I don’t mind at all! I chose the platform as I found it the easiest to navigate. I know the fees are slightly higher but for funds I aim to get ones where the on going fees are low – one of mine is 0.06% for example – so I do factor it in. I always try and invest in a lump sum to reduce the impact of fees 🙂 so at the moment I am only investing once or twice a month.