Time for another one of my favourite updates of the month; my dividend income update. I still get a little thrill of excitement when I log into my ISA and see that I have received another dividend payment, no matter how small it is. Just for owning a tiny part of a company and investing in them, believing in their ideals means we get paid dividends, and hopefully for many years to come! The payments received towards the end of the year are definitely smaller than in the summer months. But, I am still receiving money throughout the month.
I have mentioned this before but, with the individual holdings I currently own in my stocks and shares ISA, I will get 42 mini pay checks a year. For doing nothing! Instead of the one monthly payment I receive for my day job, I’m getting over forty payments instead. Adding a slow but steady income stream by investing in dividend payments has been one of the best decisions I have made so far. 2016 is the first full year that I have been dividend investing for, and I am loving it.
The dividend income received in December is a combination of dividends from shares and payments or from funds. 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. The majority of mine seem to pay out within the first six months of the year. My stocks and shares ISA is with Hargreaves Lansdown, which is very easy to use and I’d definitely recommend them. You can get information about that here or even open an ISA in about 5 minutes.
As part of our long term plans for early retirement, we need enough money in savings and/or income to make sure we can live on a budget long term. I am now counting on the small income stream that will come from dividend payments. The sooner we can get different income streams up and running, the sooner we’ll hit our aims!
Dividends received in December:
HL Multi-Manager High Income – £0.38
Premier Monthly Income – £0.71
Standard Life Inv Real Estate – £0.49
Vanguard Global Emerging Markets – £7.19
Whitbread – £11.96
Total: £20.73
So, for the final month of dividend payments for 2016, that isn’t bad! Better than the previous three months, so a great end to the year. Although £20 wouldn’t cover any of my monthly bills, it’s a start. My mobile phone bill is £29 a month, so it’s getting there! It would be great to say each month that my dividend income covers some of my monthly reoccurring payments.
As I wrote about the effect of the magic snowball, mine is beginning to gain a tiny spec of momentum. It all starts somewhere. 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.
At the start of the year, I stated that one of my aims for this year is to receive £100 in dividend income. When I wrote that, I honestly thought that I was aiming quite high. Ambitious, optimistic, but aiming high. So, at the end of my first year of investing, I am so pleased to say I have achieved my goal.
More than that, I have well and truly smashed my goal.
In 2016, I have received £168.57 in dividend payments. How amazing is that?! That is so much more than I have received in interest payments on savings for years. Years! And it can only grow from here on in. Although reinvesting my dividends alone won’t do that much, when combined with my savings each month, my passive income is only going to grow. I’m so excited to see what happens in 2017!
Have you received any dividends this month? Thanks for reading!
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If you don’t mind me asking, how much do you have invested to be earning dividends of £20 per month? I’m looking to set something up myself in 2017.
Hi Carl,
I have just under £10,000 invested at the moment which is providing my current dividend income 🙂
Thanks Nicola. I recently started investing in peer to peer lending and am seeing some good results. I’ll definitely be looking into creating a dividend income soon.
That’s so exciting! I did receive dividends from my Vanguard account, but I don’t pay too much attention to them since they just go right back into the account. Maybe in 2017, I will do a grand total. Curious to see what my number is! Can’t wait to follow along as your dividend numbers keep going up!
Hi Nicola!
Just curious. How did you arrive at your decision to pick individual dividend paying stocks?? How do evaluate and pick them given that you are not an expert at this I presume. Wouldn’t a simple investment trust, OEIC/Unit trust be much easier to manage?
I noticed your Dividend yield would be around 1.69% based on an investment of 10 000.
Impressive progress tho.
I started investing 2 years ago now, but have only chosen accumulator funds so I don’t see my dividends. I’ve made my first investment to an income fund this January though. I think accumulators are better financially, but I’m wondering if the psycological boost will encourage me to physically invest more in the long run! I have a first direct regular saver. I think the rate has dropped to 5% now, but I managed to get it at 6%, so this is one way of squeezing a bit more out of your cash, even if the interest is paid at the end of the 12 months.