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The dividend income we earned in November 2021 was another great month for our portfolio.
While we didn’t break our single month record for dividends set back in September … we did record our highest November income total. There is a very good chance we will set another new record next month in December.
We came so close to hitting $500 in monthly dividends … falling just short by less than $10 in November.
Before I get into the details of our November 2021 dividend income, I wanted to give a quick overview of our dividend stock portfolio.
We currently earn dividend income from over 40+ publicly traded companies, along with 2 ETFs.
The income we earn and are growing each year is part of our long term financial independence (FI) plan.
At some point in the future, we plan to use our annual passive dividend income to cover a portion of our yearly spending. We are building our portfolio of dividend stocks so that it can grow passively all on it’s own every year.
Based on some estimates, we could expect our dividend income to double every 8 years (or so) if we were to leave it alone. So in less than 20 years, we should be earning well over $20,000 annually in dividends (at a minimum).
That should be able to cover at least 25% of our projected spending at that time. This isn’t the only source of future income we are planning on … just part of the bigger puzzle!
And the great thing about earning dividend income is that it is tax friendly (currently) and inflation protected.
Today we are reporting our latest monthly dividend income results.
November 2021 Dividend Income – $490.24
Here is a breakdown of how we earned over $490 last month in dividends.
Dividend Income November 2021
In total we had 15 stocks pay out a dividend in November from our taxable brokerage account.
While not as high as our September dividends … November was still a very solid month.
This was our highest dividend income yet for the month for November. We managed to increase our dividend income by over 79% compared to last November (2020).
Despite what the overall market was doing (mostly a choppy month) … our dividends continued to come in and pay us … just like they always have.
Much of this growth came from new investments into Lowe’s (LOW), Verizon (VZ), Procter & Gamble (PG), and General Dynamics (GD) earlier this year.
Here is the breakdown of dividend income (by stock) in November from our taxable accounts.
The following stocks are held in our Fidelity account –
- Omega Healthcare (OHI) – $91.79
- AT&T (T) – $52.00
- AbbVie (ABBV) – $49.40
- Procter & Gamble (PG) – $43.49
- Clorox (CLX) – $41.94
- Realty Income Corp (O) – $41.30
- Lowe’s (LOW) – $32.10
- Verizon (VZ) – $32.00
- Norfolk Southern (NSC) – $30.52
- Caterpillar (CAT) – $23.31
- General Dynamics (GD) – $17.85
- Apple (AAPL) – $17.74
- Hormel (HRL) – $6.37
- Costco (COST) – $5.53
- Starbucks (SBUX) – $4.90
November 2021 Taxable Dividend Income = $490.24
As always, we continue to follow our buy and hold stock strategy with the dividend income we received last month.
This means that all of our income was reinvested to purchase additional shares of stock.
Growing Future Dividend Income
One of my favorite personal finance tasks is to update the dividend income we earn each month.
It is inspiring to watch our dividend income grow month after month and year after year.
But what is even better than reporting our dividend income earnings?
Tracking our future dividend income growth!
So every month we track our future annual dividend income.
This simple calculation takes the number of shares we own of each of our stocks and multiplies it by the current dividend of the company.
The result of this calculation represents the amount of income we could expect to earn over the next 12 months … if we walked away today and never touched our portfolio again.
This calculation assumes the companies that we own will not cut their dividend, which is unlikely (but not impossible).
There are 3 different ways we can grow our future dividend income –
- new investments
- reinvested dividends
- company dividend increases
Let’s take a look at how we grew our dividend income in November from these 3 different methods.
1 – New Investments in November
We invested $6,549.94 of new dollars into our dividend stock portfolio during November.
Most of these new funds were from the assets we got back from the sale of our home last October (2020).
My wife and I decided we had way too much cash (from selling our house) sitting around not earning anything. So we started dollar cost averaging shares of Vanguard Total Stock Market ETF (VTI) and Vanguard Real Estate ETF (VNQ).
We don’t anticipate needing these funds for several months … if not years, so we had to do something with the cash.
In addition to those funds, we also reinvested our child tax credit payment for November. Plus we had another $55+ of options income we earned that was all reinvested into our dividend income portfolio.
2 – Reinvested Dividends in November
In the past, we reinvested most of our dividends using DRiP. That was setup through our broker to automatically reinvest dividends of a stock back into partial shares of the same stock.
But now that we have a solid foundation built … we are letting most of our dividends accumulate and buying stocks directly on our own. I did recently flip the DRiP switch back on for a couple holdings – Apple (AAPL), Lockheed Martin (LMT), and Realty Income (O).
Most of the $490.24 in dividends we earned in the month were reinvested back into the portfolio.
3 – Company Dividend Increases in November
This is my favorite way to grow future income (and the easiest) … which is from company dividend increases. These company increases make this a passive income stream that will grow each and every year on it’s own.
The month of November was a big success when it came to dividend increases from companies in our portfolio.
Companies that announced dividend hikes in November that we own include –
- 21.21% increase from AFLAC (AFL)
- 6.12% increase from Hormel Foods (HRL)
- 4.24% increase from Realty Income Corp (O)
- 1.98% increase from Emerson Electric (EMR)
Typically I like to see companies increase their dividend by 6% or more.
Total Future Annual Dividend Income
We started the new year (2021) with a future annual dividend income total of $4,333.23. Each month since the first of the year, we have increased this future income number by several hundred dollars.
This number represents what we could expect to earn in dividend income this entire year … if we never invested a single new dollar, reinvested any dividend income, and no company provided a dividend increase for the next 12 months.
With all those new investments we made in 2021, our future annual dividend income number has exploded.
The combination of new investment dollars, dividend increases, and reinvestment’s … allowed us to grow our future dividend income to $6,627.61 by the end of November!
This was an increase of $118.50 in just one month … when comparing it to October (2021).
For 2021 in total we have grown our future dividend income by $2,294.38!
This increase came from three different sources –
- new investments
- companies raising dividends
- reinvested dividend income
November 2021 Future Annual Dividend Income = $6,627.61
At the current rate, there is no reason why we wouldn’t push past $6,750 of future dividend income by the end of 2021.
So what does this mean for future growth?
I like to use the rule of 72 formula to predict what our dividend income “could” look like in the future.
Let’s take a look at the rule of 72 dividend income projection.
The Rule of 72 Projections
By using the rule of 72 calculation below, it helps us project out when our income will double by using our future dividend income.
Using the rule of 72, I have estimated that our dividend income will double about every 8 years.
This is based on our goal to increase dividend income by 9% (at a minimum) every year. For example, between 2019 to 2020 … we increased our dividend income by 9.6%. This year (2021) we will likely grow our dividend income by over 45%.
As long as we can grow our dividend income by 9% or more, we will double our dividend income every 8 years … or less.
Based on this, I can calculate out how our dividend income could grow (and double) based on our future annual dividend income number of $6,627.61 … that would be earned on December 1, 2022.
Take a look at how our income could double overtime –
- 12/01/2022 – Annual Dividend Income = $6,627.61
- 12/01/2030 – Annual Dividend Income = $13,255.22
- 12/01/2038 – Annual Dividend Income = $26,510.44
- 12/01/2046 – Annual Dividend Income = $53,020.88
Our updated figures tell us we should be earning over $53,000 per year in dividend income by December 2046.
Keep in mind, this is more of a fun what-if type of scenario. I believe we have figured conservatively … and our income should grow at a faster rate. And it should be fun to watch this number grow every month when we post results.
It is also important to remember that all of this income is in taxable accounts … which means we potentially may pay taxes on some of this income.
The good news is that most of our income comes from qualified dividends … and the majority of it won’t be taxed under current tax law.
We Sold our AT&T (T) Shares
Before we wrap up, I wanted to share that all of our shares of AT&T (T) stock were sold in the month of November.
While I don’t usually disclose every trade we make in our portfolio, I think it is important to highlight this one.
At one point, this company was generating over $200 of annual dividend income for our portfolio. It made up a good chunk of annual dividend income for us.
Based on the direction the company is taking, my wife and I no longer feel it is a good fit for our dividend income portfolio.
All of the the funds generated from the sale of our AT&T shares were invested into AbbVie (ABBV).
The purpose of this disclosure is not to recommend buying AbbVie or selling AT&T. We simply wanted to show how it can be important to know when to sell under performing stocks in your portfolio.
We took a bit of a hit on our future dividend income projections by making this trade. However, years from now it will only be a small little blip in our opinion.
Dividend Income November 2021 Summary
In November, we earned $490.24 of dividend income from our taxable brokerage accounts.
This was our highest dividend income for the month of November.
The dividend income could help cover some of our monthly expenses – like a car payment and utility expenses.
My wife and I have set a long term goal from this dividend income portfolio to cover at least a 25% of our monthly expenses … which right now is about $1,250 (our monthly spending is currently around $5,000).
Our family would have a lot more flexibility knowing a good portion of our monthly expenses could be covered by our passive dividend income stream. That is an awesome feeling.
The overall goal for 2021 was to earn $4,500 in dividend income from our taxable brokerage accounts. So far, we have earned a total of $4,917.07 in dividends for 2021.
After 11 months, we have blown past our original goal!
With all of the new investments we have made the past 11 months, our dividend income has exploded in 2021. At this point, we are trying to hit $5,750 in dividend income this year compared to our $4,500 goal.
Another bright spot over the last several months, is how we increased our forward dividend income by so much.
We are now on pace to earn $6,627.61 over the next 12 months … without doing anything. This figure does not include any new investments throughout the year. No dividend increases and no dividend income reinvested.
Based on these numbers, we are planning to shoot for earning $7,000 in dividend income in 2022!
How was your dividend income in November? Are you actively investing and growing your portfolio?
Full Disclosure – At the time of this writing, we owned shares in all of the stocks mentioned in this post. The material above is not a recommendation to buy. Please do your own research on a company before deciding to invest.
