This post signifies the end of my third full year of investing. I can’t believe I’ve been able to write these updates for so long! I have been debating whether to change the frequency of these updates, but as I believe strongly in creating this second income stream, I shall continue for now. Do you find them interesting? Three years ago I had yet to receive my first dividend payment, so this just shows what a little time and patience can achieve! Although the markets have been quite volatile lately, I just need to sit it out and continue to follow with my plan.
See also: Dividend Income
Some months are so much better than others as the income received varies so much. The final month of the year seems to be a great one for dividend income, as you shall see 
and all for doing nothing! Although I need to keep an eye on the market and the companies I am invested in, it is fairly passive in its nature. I have it set so that the dividends are kept in my isa and so I can reinvest them where I see appropriate immediately.
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.
The dividend income received in December is a combination of dividends from shares and 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. In December 2017 I received £184.28 in dividends. This year is even better 
Dividends received in December:
Card Factory – £15.80
ITV – £13.00
Vanguard FTSE UK All Share Index – £150.53
Vanguard Global Emerging Markets – £37.55
Vanguard US Equity Index – £17.62
Whitbread – £3.27
Total: £237.77
Look at that….!!! My biggest month to date. Woohoo! Last December was my highest paying month (until now!) so it looks like I have got some good contenders which means I end the year on a positive note. This would pay our council tax and our water rates. That’s seriously amazing! At the moment, all dividend income received is reinvested, but it’s nice to know that we could cover a significant bill using this. 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 2018 was £800 received. At the end of December, and indeed 2018, the final total for dividend income received is £896.45 so I have well and truly beaten my target. When I wrote about receiving £800 at the beginning of the year, I honestly thought that might be a stretch. Look how wrong I was! I must admit, at the end of November I was a little anxious and thought I might have given myself a too bigger aim, but here we are 🙂 Here’s a visual look at my dividend income for the past three years:
Have you received any dividends this month? How did 2018 look for you? Thanks for reading!
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After reading your blog I have finally opened a stocks and shares ISA, thank you for inspiring me to save for the future! . I have a question – do you add money into this each month, or do you just add the money received as dividends?
Ooh fab, well done you! I add money to it each month plus reinvest the dividends 🙂
That’s a super amount of dividends for the year, I guess around a 4% average return?
The elephant in the room though – how has the underlying capital value faired in 2018? Has the dividend income kept you in the black, or are you in the red overall?
Me, it’s been a bit of a blood bath all in all with markets finishing well down on the year 😩
Mine is in the red, just. Dividends have helped 🙂 but, it doesn’t matter until you sell, right? It has been a bit rocky of late, but I’m happy to sit the ride out.
Yes and no, lower capital values can occur because of lower earnings potential when looking at the classic income producing assets, so this may affect next year’s dividends if earning are down and not just hit you if you sell the underlying asset.
You did it!!! Oh I’m so chuffed for you and really excited to see how you get on this year!
Thank you! 🙂
I also have an income portfolio but am invested in managed monthly income funds, Artemis monthly income and Premier Asset monthly income. I actually do use the income to pay monthly bills as I retired early at age 58 as did my husband. The monthly dividends are usually in the region of around £300 and return 4% over the year. The capital values have gone down though in 2018. We use the income to supplement our final salary pensions.
Sounds like you’ve got a great set up 🙂
Really inspiring to see how much your dividends have grown since you started investing. Here’s to yet more dividend growth in 2019!
Thank you! And I don’t think I’ll be able to save as much this year, but here’s to more growth 🙂 aiming for £1,000 in dividends by the end of the year!
Fantastic result! Very awesome to see how much your dividends have grown over time. We received almost $19k in dividend income for 2018. Very happy with the results.
Here’s to a great 2019!
Thank you! And WOW. I cannot imagine receiving that much income in dividends – that’s amazing. Do you reinvest them?
I can’t see your total holding any longer. Do you no longer publish this. Interested to see which companies you invest in 😀
I don’t publish my total holding anymore but I am due an update post, so thanks for the reminder!
Why don’t you show your total holding any more? it would be interesting for your readers to follow the value of your investment and the return you receive as a percentage investment.