Another dividend income post, already! I can’t believe how close we are to the end of the year now; only two more dividend income posts to write after this one and 2019 will be complete. I can’t wait to see what my dividend income total will be! I am now quietly confident that I’ll hit my target of £1,000 of income received in 2019. I have done myself a projection of what I need to do year on year from now on. It is interesting reading!
The one thing I have continued to try and do this month – and succeeded – is to not check my ISA every day. The reason behind this is that I am a dividend growth investor, so the amount my shares are worth day to day is not particularly useful information. The only time when it really matters is the day I plan to sell. I know that it’s a good idea to keep an eye on things, but I was becoming a bit obsessive about checking every day. There’s just no need! So I really took a step back from checking this month which I actually felt better about in the end. I aim to keep doing this as I feel like shares are going to have a bit of a rocky time so I need to not check so often.
This is my fourth year of dividend investing, already. I can’t believe it! And one of the only things I regret is not starting sooner. If you’re putting off investing, because of the risk or thinking you don’t have enough to start, then please do. You can start with £25 a month into a low risk fund and go from there. It will add up over time and make a difference. You can reinvest as well, so if you’re thinking about starting to invest, please do!
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. 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. I am quietly confident that we will be able to do this, in the long run. If I can average £500 a month (!!) then that would pay for a big chunk of our fixed expenses each month.
Dividends received in October:
GlaxoSmithKline – £26.65
Total: £26.65
Okay, so definitely very different from last month’s bumper payout! That’s the difference when you only have one company pay out, instead of multiple holdings. I’m a little disappointed that this number is low, as this wouldn’t cover any of our monthly bills. Which is what the aim is, eventually. At the moment, all dividend income received is reinvested, so this will be kept until I add some more savings to buy more shares. 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. If I show you this graph which shows year on year growth, it looks good:
The orange lines are for 2019 – you can see the difference in some months already. January was slightly lower but February was much more, as was May’s dividend income. Then there were three months where the income was lower than the previous year. I think this looks good! I’m hoping to finish off the year strong, like the previous years 🙂
My dividend income aim for 2019 is £1,000 received. At the end of September, I am up to £804.51 which is not bad. However, I am now definitely behind where I should be at this point. So, some catching up to do! Here’s hoping I can do it 🙂
Have you received any dividends this month? Thanks for reading!
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I have seen the graph that you use on a few different blogs and I think that it’s a bit confusing to look at.
Have you thought about using a moving average (3m/6m/12m) to view your dividends?
I find that using a 6m moving average helps steady out the peaks and troughs (for example our investment in one share pays out £250 1 month out of every 3 – which is more than our ISAs do on any given month, making it look very lumpy.
The advantage of the moving average is that you get to see the trend – even if the year/year monthly comparison is lost.
Hi Nicola,
Congrats on the achievement. With the recent strong Decembers, I do believe that you will make the 1000GBP by the end of the year.
Here at Odysseus household, we got a good amount in October, unfortunately not as good as the past months. October is usually a not so good month for dividends for us.
All the best.
Cheers!
Thank you for the post – very interesting :).
Why not have Accumulation ISA (what I have at Vanguard) so the money will automatically be re-invested?
Because I like to get the income and then choose where it goes 🙂