Investment Income Update – June 15th 2014

June 15 2014 Inv Income ChartThe Investment Income page on my blog has been updated as of June 15th 2014. This page outlines my portfolio of investments and the income they generate on a yearly and average monthly basis. Also included is a chart with a historical look at my investment income since October 15th 2003. I track my investment income on the 15th of the month.

Last month saw dip in my investment income due to a property tax increase and the Bank of America dividend retraction. But this month my portfolio has recovered from the dip and then some.

Saturday I returned from a much needed week-long vacation. It was a vacation from work in the sense that we went to a beach and stayed at a nice place with my extended family. But I spent most of the week chasing my two-year-old son around the beach and town. It was an exhausting week as I had little time to simply relax. Family helped at times, but with four kids under five years old constantly on the move, the adults in the house were all craving some alone time.

While I was gone, I published a post about my new Facebook page. If you are on Facebook, please click here to like my page. The financial blogging world seems to hang out mostly on Twitter, but for those that prefer Facebook, my posts can now be viewed in your feed there. I’ll only be posting my latest posts. If you find the content compelling, please consider sharing with your social network.

Bank Transfers this Month
One of my goals for 2014 is to simplify my finances and consolidate some accounts. The most significant of these consolidations is transferring all of my banking to Wells Fargo. I’ve been a loyal PNC bank customer for more than 10 years and I’ve had few complaints. The only real complaint, however, is the lack of a branch near my house. I have to drive 15-20 minutes to use the ATM which is near my old condo (now my rental property). PNC covered all fees for non-PNC ATM transactions for me, but I still wanted to have a bank closer to my house.

Wells Fargo has three branches within minutes of my house. On top of that, Wells Fargo holds both my home and investment property mortgages. By switching to them, I eliminate my PNC logon, and can do everything I need via one website including pay my bills. So far, the Wells Fargo experience has been OK. The person that opened my account wasn’t as knowledgeable as I hoped, and she was very slow (a problem since I had my son with me). The perks aren’t as good as the old PNC accounts because I was there for so long. But like most banks, it should do the job just fine and should have no fees if I follow the basic account rules. I had three accounts at PNC which I’ve consolidated into two at Wells Fargo.

Here is a summary of investing activity for 05/15/14 – 06/15/2014:

By adding $1890.00 in new working capital to my investments, my forward 12-month investment income (F12MII) increased to $4,337.49, an average of $361.46 per month. This was a $127.83 and 3.04% increase over last month and a $1,140.06 and a 35.7% increase year-over-year. I consider the $4,337.49 in F12MII the most important number because it represents how much money I would receive though investment income if I stopped working today. My goal for 2014 is to reach $5,000.

Due to transferring cash from PNC to Wells Fargo, my cash savings that collect interest was lower this month. This probably lowered my F12MII by about $30. This income should return by the next update.

DRIPs (Computershare/Broadridge)
After ten years of building a position, I transferred my Verizon shares out of Computershare and into my TD Ameritrade account. This move eliminated a reinvestment fee and adds fuel to my taxable stock purchasing account. I’m hoping to do this for other holdings in the future once I have reached certain levels for each holding.

I continued to DRIP into a few stocks including my Procter & Gamble (PG) DRIP that I started in April. This list also includes Catepiller (CAT), a company that had an excellent 16.7% dividend increase recently. The stock price has been on a tear. One downside of dripping is that you buy on a regular basis, sometimes at higher valuations, instead of at a determined chosen price. When I started purchasing the stock last August, it was trading around $83. Now it’s trading around $107, but I’m still adding funds. I’m not always good at picking bottoms or tops, so the DRIP is a solid method to dollar cost average. While I’m not thrilled paying $107 for the stock, I’ll continue building the position through the DRIP. Today’s price could be a bargain, who knows. Ten years from now I’m confident the stock and dividend will be higher. My average purchase price to date is $90.47 and I’m reinvesting the dividends to grow the position.

I’m continuing to DRIP $50 a month into Aqua America (WTR) and reinvesting the dividends. A cool thing about this DRIP program is that it offers a 5% discount on dividend reinvestment. So if the stock is trading at $25 on the day of the transaction, dividends are reinvested as though the price is $23.75… very cool. I plan to keep that DRIP going slowly for the next few years.

Clorox (CLX) is an investment holding I’ve been adding to for more than a year now. My position has slowly grown to about $2,000 through bi-monthly investments and dividend reinvestment. With a low beta of 0.47 and 3.30% yield, I’m very happy continuing the DRIP until I reach at least the $3,000 mark. At that point I’ll reevaluate. Last month CLX increased its dividend by 4.2%.

I initiated a position with CSX through the DRIP program back in October. As you may have read in my post about it, Computershare was administering the program when I started, but soon after it switched to Broadridge. The Broadridge website is fine, but it’s another logon I’d like to eliminate to help simplify things. I think I’ll end up transferring those shares to TD Ameritrade sooner than later as an additional account consolidation.

Taxable Account (TD Ameritrade)
I made one purchase in my taxable account this month, American Reality Capital Properties (ARCP). This commercial REIT is a popular investment choice for dividend investors because of its monthly dividend. The monthly dividend was one factor for my purchase, helping to smooth out my income over the months. The 8%+ yield is another. I bought 100 shares at $12.40. With the high yield and some short-term downside risk involved in this position, I’ve bought all the shares I want for the time being.

The company made a fairly controversial move recently to buy property associated with Red Lobster in a deal with Darden and Golden Gate Capital (head on over to Seeking Alpha for many viewpoints about this deal). They sold some other commercial properties to pay for it. The frequency of deals by the company has gotten some investors nervous and the stock price has been in decline. ARCP has very high quality tenants and strong occupancy rates which I believe will provide a good ROI over time. Anecdotally, I recently went to Red Lobster for the first time in about 30 years. My expectations were quite low, but I was pleasantly surprised by a nice dining experience.

If you didn’t hear (if you’re on Mars), Apple (AAPL) announced a 7:1 stock split this past month. That brings my total number of shares to 112. I previously referred to Apple as the elephant in my portfolio, and that holds true now as the largest holding in my portfolio and the first to top the $10,000 mark. I continue to be long, and believe we’ll see $100/share soon. The tech and financial worlds are anxiously awaiting the iPhone 6 and anything else up Apple’s sleeve. I’m still hoping for a simple Apple TV upgrade since I dropped my cable TV.

IRA Investments (Fidelity)
This month I made one new purchase in my Roth IRA account. The purchase used up all the remaining cash there, until I start up the funding again (on hold because of the bank checking account switchovers). I bought 45 shares of Hasbro (HAS) at a cost basis of $51.54. I’ve had my eye on HAS for many months now, ever since I decided to buy both Mattel (MAT) and HAS to have exposure to a large part of the toy industry. I believe the purchasing power of doting American grandparents is very powerful, and diversifying my toy investment into the two biggest players is better over the long-run than just buying one. Now is the time to buy toys as there is a traditional run-up into December. MAT in particular had a disappointing Christmas season last year so the comps should be easy to beat.

When I bought MAT, HAS was valued higher at the time so I decided to wait. On June 3rd, HAS dipped and I nibbled. Why did I buy in my Roth IRA? Because that was where the idle cash was sitting. Also, my strategy of buying index funds in my IRAs is not going well at the moment because I believe the indices will retract at some point this year. So far I’ve been very wrong about this. Seeing the dip in HAS, I made the buy because I want to own it for a very long time. I still plan to buy index and dividend paying ETFs in this account, but not until I see better value in the overall market.

Last month you read about the Whole Foods (WFM) purchase in my wife’s traditional IRA. So far this investment has panned out well. Of course one month is a tiny fraction of my investment horizon for this holding. The $5,500 in cash in her Spousal Roth IRA is still idle, so I need to get that cash to work soon.

That’s all I have for this month. Thanks for stopping by, reading, commenting and sharing on your social networks. As always, check out my Investment Income page to see my portfolio and latest numbers.

22 Responses to Investment Income Update – June 15th 2014

  1. Income Surfer June 18, 2014 at 9:35 am #

    Looks like a great month RBD. Our Little Man isn’t mobile yet, but I can see how vacations will be exhausting once he is 🙂 Glad to hear you’re still DRIPing. Mine has been great for me over the years.


    • Retire Before Dad June 18, 2014 at 9:48 am #

      Mobility changes things a lot, but the 9 month old was a full time job too. Not to mention a blowout into the car seat during the 5 hour drive! Still working a lot if drips. Considering some other platforms rather than the direct invest. But it like the steady growth the way I’m doing it.

  2. Roadmap2Retire June 18, 2014 at 9:45 am #

    Congrats on another great month. Steady progress makes for a good retirement setup.


    • Retire Before Dad June 18, 2014 at 9:50 am #

      Thanks R2R,
      One step at a time. Still need to pick up the pace a little to hit my goals, but half a year left. Thanks for sharing these updates on your monthly blog report.

  3. DivHut June 18, 2014 at 6:03 pm #

    New purchases, dividend increases, reinvestment, lending, nice dividend income, this is the type of update that gets my juices flowing and many others too I’m sure. Seeing the increase in income month after month is what drives all of us to continue being dividend investors. Thanks for sharing your recent updates.

    • Retire Before Dad June 18, 2014 at 9:49 pm #

      Yeah, it’s a long slow process, but exciting nonetheless. Increases of that magnitude are great for motivation. They make me want to put more money to work! Thanks for stopping by DivHut.

  4. Dividend Mantra June 18, 2014 at 9:44 pm #


    Another solid month!

    Sorry to hear the vacation wasn’t as relaxing as it could have/should have been. Gotta love the little kiddos! 🙂

    Congrats on the successful month in the investing arena. A big move in dividends there, as that ARCP certainly helped boost things with that monster yield. Gotta love that.

    I’ve at times thought about switching to Wells Fargo because I’m heavily invested in the bank and I’ve heard they have great customer service. Unfortunately, they’re not that big around here. Maybe one day.

    Best wishes!

    • Retire Before Dad June 18, 2014 at 9:54 pm #

      The kids were a blast at times, especially running around the beach. But, man, at times I just wanted to read or fish and I didn’t get much of those.

      Solid month, but was hoping to find more opportunities in my taxable account. Going to have to settle for fair prices here soon instead of finding perceived bargains.

      WF should do the job. I was a little disappointed in their fee structures, but I guess that’s good for shareholders!

  5. JC @ June 19, 2014 at 6:25 pm #

    Looks like a pretty solid month. I’m hoping to put some more capital to work to keep building up my portfolio but man Mr. Market isn’t in a really giving mood.

    I can’t speak from experience with my own kids but I know that when I was a teenager I was usually the one in charge of the younger kids with family get-togethers. They can definitely be a handful.

    • Retire Before Dad June 20, 2014 at 8:44 am #

      I hear ya, this market is tight. Everyone waiting for dips means no dips. So gotta buy value when we see it or pay fair value. That said, yields are still attractive, so some companies look good here. I’ve not been aggressive buying, but I don’t need to be. Just waiting to see decent prices and buy when cash is available.

  6. Nicola June 21, 2014 at 12:54 pm #

    A great month for you! Vacations with small children can be hard work 🙂 loving the detailed accounts, thanks for sharing 🙂

  7. Happy Healthy and Wealthy Girl June 22, 2014 at 11:21 am #

    congrats on a great month! I agree with you on toy industry. I have shares of MAT too.

    Now I discovered for myself CAG but waiting on money to invest.

    I remember this time when my son was 2 y.o. These boys never stay still. 🙂

    • Retire Before Dad June 22, 2014 at 9:41 pm #

      Thanks HHWG. MAT are HAS will each have winning years and losing years, depending on what toys are hot and what kind of licensing deals they can solidify. I figure I’d own both to cover it all. I suppose I should buy WMT too as they sell the most toys. Yes, unfortunately he’s hit the terrible twos. I thought he might bypass that, but I was way wrong!

  8. Asset Grinder June 25, 2014 at 2:26 am #

    That is some serious upwards movement in your passive income. Very nice. Keep it up! Like your Reit play!

    Good Day and Grind On!

  9. June 26, 2014 at 4:50 pm #

    I like the whole foods addition. That has also caught my eye as well, but I’m yet to take the plunge. It’s very good value here.

    • Retire Before Dad June 29, 2014 at 11:07 am #

      I like the long-term value at this price level. MGT has a clear path of growth ahead of them, and a history of delivering. 20% was a big drop for a company with so little debt. Its now at about where I bought it, and I’ll probably buy more if it dips further.

  10. Evan July 1, 2014 at 2:51 pm #

    I am heading to the beach next week for a few days (disney last month as well as a trip to Thomas the Train Engine in PA)…I feel your tiredness! This was the first trip that I realized i had to change the definition of vacation away from relaxing LOL.

    “A cool thing about this DRIP program is that it offers a 5% discount on dividend reinvestment. So if the stock is trading at $25 on the day of the transaction, dividends are reinvested as though the price is $23.75… very cool. I plan to keep that DRIP going slowly for the next few years.”
    – That is AMAZING! Are there are lot of stocks that do this? Imagine getting an automatic 5% gain for the next 10 years on a blue chip? Take that 6 to 8% and turn it into 13%?!

    • Retire Before Dad July 1, 2014 at 2:57 pm #

      WTR DRIP has that really cool feature. I think some employers give the benefit to employees (I know IBM does), but it’s not all that common in the DRIP world. It was a bonus for me when I decided to buy the stock, I didn’t even consider know they had it. From what I’ve read, this kind of DRIP is rarer than it used to be. Have a good trip to the beach! Oh man, we need to get up to that Thomas the train thing. That’s north of Phily, right?

      • Evan July 1, 2014 at 3:08 pm #

        DO NOT GO. IT WAS A TERRIBLE WASTE OF MONEY! Lancaster and Dutch Wonderland was pretty cool but thomas was a HUGE waste of money.

        Ever see DQYDJ’s Dividend reinvestment Calculator?

        Run it on WTR for 10 years and then imagine ANOTHER 5% discount! Talk about power

        • Retire Before Dad July 1, 2014 at 3:17 pm #

          Thanks for these two valuable tips. I have not checked out that calculator until now. That’s very helpful. And good to know about Thomas, sad as that is. There’s a similar train ride at the Ocean City, NJ boardwalk that pretty much serves the same purpose. Much cheaper, and plenty of other distractions at the boardwalk.

  11. Sam July 15, 2014 at 10:14 am #

    Nice income stream. Thanks for the reminder on LC. The angle investor I refer to in my latest article on increasing passive income with leverage is actually one of the early investors in LC.

    SF is going nuts… How many employees do they have? I guess I can look it up.

    • Retire Before Dad July 15, 2014 at 10:24 am #

      Thanks Sam. New income update will be live tomorrow. Looks like they are over 500 employees now (according to Glass Door), but with all the growth and the upcoming IPO, that’ll likely help increase your rental income even more!

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