Another month has come and gone, and I made some money in pajamas during June 2016. While I do quite a bit of work from home (or on the road) most months, my goal is to get a higher percentage of that income to come from passive sources. The biggest source of passive income that I’ve decided to work on is income via dividends. These payments from quality companies generally come in on a quarterly basis, and they provide me with additional capital to put toward additional stock in high-quality companies that I already own or that I have on my wants list.
My money can work harder than I can over time. I have to put in effort to earn money, but I have a limited number of hours in the day that I can actually work. My money can work day after day after day, 24 hours a day, 265 days a year. While I have a relatively small trickle coming in these days, I am planning to see this tiny stream grow into a rushing river of dollars in the future. It might take several years to get there, but if I’m able to continue on this path that I’ve started, I fully anticipate that my goals can be reached. The companies that I own paid me on several occasions last month, and without further ado, here is the passive dividend income that I didn’t have to work to earn in the month of June:
Unilever PLC (UL) $0.08
Wal-Mart (WMT) $3.02
Kellogg (K) $0.72
McDonald’s (MCD) $3.40
Royal Dutch Shell PLC (RDS.B) $11.63
TOTAL DIVIDEND INCOME FOR JUNE 2016 $18.82
This dividend income might not seem like a massive amount, but it is a record for me. My previous high for a month was back in March, when I received $13.62 from my dividend-paying stocks. This was a 38% increase over just the past three months. This income brings up my total annual dividend earnings up to $61.61. I am now up to averaging a cool $10 per month in dividend income, and I’ve almost passed the $20 mark for a single month. I measure my progress by the number of hours of work that I could theoretically take off were I to replace work with passive income. My estimated annual dividend income at this point is up to $147.57, which is right around 7.5 hours were I to figure that I need to replace $20 per hour (after taxes and retirement contributions that would no longer come out). In June, I could have almost taken off an hour of work at this rate. My hope is that this will only continue to grow over time.
Disclaimer: I am not a licensed financial professional. Be sure to do due diligence before investing in securities. This article is not a recommendation to buy a specific company. It is only for educational/entertainment purposes.
I had a bit of capital that came in over the past week, and as I’ve noted before, passive income is the best income. It really allows me to earn money in pajamas–day after day, week after week, month after month. The people who work for the various companies that I hold work around the world, and their products are sold 24 hours a day. This permits me to increase my capital over time as the dividends pay out and slowly grow. I put $21 to work in each of my Loyal3 holdings. I do not have to pay out any trading commissions when purchasing stocks through Loyal3 my total purchase was $105. My capital bought me the following partial shares and additional dividend income:
Company Shares Purchased Additional Dividends
McDonald’s (MCD) 0.1906 $0.68
Kellogg’s (K) 0.3153 $0.63
Coca-Cola (KO) 0.5013 $0.66
Apple (AAPL) 0.1863 $0.39
Wal-Mart (WMT) 0.3675 $0.72
I’ve decided that these were all good companies when I started investing earlier this year, and I’m sticking with my decision even with the recent concerns over Wal-Mart. I’m planning to be in this for the long haul, so I’m not planning to sell unless a dividend is cut. My goal is to get about $500 in capital invested in each of my companies before adding another (although I might diversify more if I find another company that’s a great deal). When adding up the additional dividend income that I’ve added with this latest purchase, I come up with $3.08 in additional dividend income. Apple has a lower yield, but with the massive amounts of cash that the company produces and has on hand, I’m of the opinion that they should be able to grow this dividend extensively over time. Otherwise, I would have had a few more cents.
This additional $3.08 on an annualized basis brings my estimated yearly dividend earnings for the next 12 months to $73.53. Considering that I had an estimated $0 coming in just about four months ago makes me reasonably happy with this big increase. I’ve already set another record for monthly dividend income this month, and I hope to see it grow so that I’m earning more and more in pajamas every quarter (because the income is a bit uneven based upon when my companies pay). Have you made any investments lately? How much passive income have they provided?
Last week, I decided to use some money that I’d come into to buy some more stocks with my Loyal3 account. I had a total of $75 to invest, along with my first $2.62 in dividend income. I’ve decided to reinvest dividend income so that I can keep the dividend snowball adding additional dividend income, which is a great way to passively earn money in pajamas. As I’ve stated many times before earning money from home is a great thing. The more dividends I can amass over time, the more money I will make in pajamas.
Because you can only purchase whole dollar amounts from Loyal3, this meant that I had a total of $77 to invest. I have positions in five companies through Loyal3, so I decided to pretty much invest an equal amount in each. The exception to this was my position in Kellogg (K), which I just opened with a $25 investment. Therefore, I had $15 going to McDonald’s, Wal-Mart, Apple, and Coca-Cola. I decided to reinvest my dividend income into Kellogg to help this investment catch up in terms of my total capital outlay. My purchases added the following amounts to my positions:
While this might not seem like I’ve added a great deal to any of these stocks (and that would be a correct assessment), it nonetheless is just another brick in the dividend wall that should help with my expenses as I age. My goal is to supplement any pensions, 401k accounts, and social security payments that I might get. My additional estimated annual dividend income from each of these purchases are:
Therefore, these small purchases of additional fractional shares of five large cap, blue chip companies add a total of $2.25 to my annual dividend income. My total expected dividend income from my Loyal3 and TradeKing portfolios is now up to $48.53. While this might seem like a pitiful amount of money, it takes time and invested capital to get this income up. Were I not to put any more capital to work in the next year, I should see a bit of an increase from dividend increases. As of now, I’ll average just over $4 in dividend income each month. However, my goal is to add to this as funds become available so that I can earn more money in pajamas because passive income is the best income.