Buys and Sells for the Week 4/16

New York Stock Exchange New York New York 1

Week started off well with a couple dividend raises from Procter & Gamble (PG) and Artesian Resources (ARTNA). Still small pockets of value in the market just not the screaming buys they were compared to this time last year. Here are my buys for the week:

  1. Oil-Dri Corp. of America (ODC) – increased position –  Prices retreated on this micro-cap. Not a bargain basement sale but good enough for this market. Grabbed 5 shares @ $34.50 and a 3.01% yield.

Buys and Sells for the Week 4/9

Markets trading at all time highs. Value is hard to come by and continuing to keep my buys limited to just $200 lots. Here are my buys for the week:

  1. Merck (MRK) – increased position –  Big pharma sector is not participating in the S&P 500 climb and MRK is no exception. Grabbed 2 shares @ $75.70 and a 3.43% yield.
  2. Unilever (UL) – increased position –  UL seems range bound in the $50 range and I have a very small position, good time as any to add shares. Grabbed 3 shares @ $56.60 and a 3.34% yield.

I Did Not Let College Impact My Retirement

I currently have 2 kids in college and one that graduated last year.  When I mention my 3 kids and college most people assume I am struggling financially.  The truth is, it has not impacted me at all and my children have taken on minimal to no debt. The success of this is based on two simple factors; 1.) planning for this moment and 2.) educational choices made by my children.

First let me quickly describe my children’s educational choices.  Even though they all chose different colleges, all three children had three things in common:

  • Commuted to college which saved ~$60K of on campus living.
  • Attained a semester’s worth of college credits while in high school which saved $5-$6K in tuition.
  • Assumed responsibility for paying back their own debt.  

My oldest graduated with $12K in student loans, my middle child is on a path for $20K in student loans and my youngest is on target for $0 in student loans.  Even with these factors, one would still assume I saved or borrowed quite a bit to pay for my children’s education to keep their borrowing so low.  However, you would be wrong.  It again comes back to planning which started as soon as my children were born.

My wife and I started planning for our children’s college back in 1999 as even then there were fears of how to pay for college and how much of a burden it was.   I witnessed how college costs were burdening older co-workers and family members, I refused to be in that position.  I knew being in my 50s that ramping up savings for that final retirement push had to be my main priority and not college debt, so I had to save immediately for college.

Back in 1999 we did not make a lot of money but knew the power of time and compounding was on our side.  But before we jump into the investment piece, I thought it would help to understand exactly how much we invested into college and for that I will use my youngest son’s current position:

  • $8,000   Used Car
  • $837      Laptop
  • $4,850   U.S. Saving Bonds
  • $3,105   Educational IRA
  • $16,792 total investment for each child ($7,955 for actual tuition)

When you amortize this over 18 years it really was not a big investment.  Of course, ~$8K is not enough to cover 4 years of tuition, the secret really comes down to the Education IRA.  One of the most hyped-up college savings vehicles is the state 529 plan, but when my wife and I looked at our state’s 529 offering it had horrible investment options and fees.  Instead, we chose an Education IRA or Coverdell Education Savings Account as they are formerly called.  An education IRA allows you to choose any investment, but it did come with an annual contribution limit.  For us it was perfect, we did not make a lot of money, so the contribution limit was not a concern and we had the freedom to invest in anything. It is important to note, today’s state 529 plans have drastically improved their investment options and Education IRAs no longer have this advantage.

We chose to go with T. Rowe Price and selected a balanced fund called the Capital Appreciation Fund (PRWCX).  We initially opened the account in December 2002 with a $500 deposit and then there was a change in the tax code that increased the annual limit to $2000 so we made a large deposit in February 2003.  After that we made small contributions up to 2007 to bring the total investment to $3,105 and made no contributions after that. Here is the total return of that investment which has been a buy & hold strategy for the last 18 years. (note: the black line is my investment and the green line is the total return)

That ~$3K investment has ballooned to $23K with an average annual return of 10.44%.  Combine this with the U.S. Savings Bonds, which are now worth $8,853, my son has a total of $32,232 to pay his tuition bills. Since he chose to attend community college his first 1 ½ years, his remaining tuition is approximately $30,000 after he transfers to a 4-year college. 

Hindsight being 20/20 I should have invested more into the IRA and less into the U.S. Savings Bonds, but you will have to forgive me as investing in the 2000s was not the best of times and I was hedging my bets.  Regardless, the story is college does not have to be expensive if you invest early and let compounding do its magic.   Because of this I did not have to take out a second mortgage on my house and I can concentrate on providing my wife a retirement she deserves and not being a financial burden to our children.

March Dividend Income

After 34 years of clocking in and out of work and religiously saving 10% annually in my 401K every year, in good times and bad, I have decided to share my monthly dividend income to show what regular saving and investing can accomplish.

Last month I received my annual review and after several paychecks with the new raise I was able to increase my weekly investment into my M1 Finance account by $10.  This improved my annual saving rate from 24.6% to 24.9%. Not a massive increase but it always feels good when I can save more than I did yesterday.

2021202020192018201720162015201420132012
401K11%10%10%10%10%10%10%10%10%10%
Brokerage4.5%4%3.7%1%0.8%0.5%  0.7%0.2%
Roth IRA9.4%8.3%5.4%1.9%      
Total Saving Rate24.9%22.3%19.1%12.9%10.8%10.5%10.0%10.0%10.7%10.2%
10 Year Personal Annual Saving Rate

For the month of March I made $4,238.43; an increase of 27.51% versus this time last year. From now till August I should be seeing significant YoY increases as that was the bulk of the COVID cuts from last year. This month would have been slightly higher but my BEPC dividend did not credit my account until April 1. This was kind of odd as I received my BEP dividend on March 31, maybe BEPC had border crossing issues from Canada to the U.S. 😊.

Overall market valuations continue to remain high. I kept my buying for the month limited to $200 lot buys to keep invested. I have been receiving dividends at a faster rate than reinvesting and unintentionally building a pile of cash.  Going into April I have no favorites on my watch list and instead will monitor a little over 50 dividend stocks for any opportunity that arises.  Unless there is a pullback, I plan on staying with small $200 buying lots for the foreseeable future.

DateSymbolCompanyAmount
3/1/21 ALEALLETE INC$126.00
3/1/21 PSXPHILLIPS 66$25.30
3/1/21 SJMSMUCKER J M CO$4.04
3/3/21 FASTFASTENAL$11.35
3/4/21 BLVVANGUARD BD INDEX FDS LONG TERM BOND$13.47
3/4/21 CMICUMMINS INC$37.67
3/4/21 DFSDISCOVER FINANCIAL SERVICES$11.40
3/4/21 VCLTVANGUARD SCOTTSDALE FUNDS LONG-TERM COR$13.97
3/4/21 VLOVALERO ENERGY CORP$35.28
3/5/21 HYGISHARES TR IBOXX HI YD ETF$18.66
3/5/21 PFEPFIZER INC$222.81
3/5/21 PFFISHARES TR PFD AND INCM SEC$50.84
3/8/21 SOSOUTHERN CO$60.78
3/9/21 JNJJOHNSON &JOHNSON COM$175.26
3/10/21 CVXCHEVRON CORP$21.77
3/10/21 IBMINTERNATIONAL BUS MACH CORP$143.97
3/10/21 UPSUNITED PARCEL SERVICE INC$227.85
3/11/21 MSFTMICROSOFT CORP$61.03
3/11/21 PRUPRUDENTIAL FINANCIAL INC$471.27
3/12/21 MMM3M CO$56.89
3/12/21 WBAWALGREENS BOOTS ALLIANCE INC$43.15
3/15/21 AVAAVISTA CORP$131.16
3/15/21 FAFFIRST AMERICAN FINANCIAL CORP$145.13
3/15/21 NWLNEWELL BRANDS INC$25.56
3/16/21 DUKDUKE ENERGY CORP$58.50
3/17/21 ULUNILEVER PLC SPON ADR NEW$9.36
3/18/21 BHBBAR HARBOR BANKSHARES$43.91
3/18/21 PSECPROSPECT CAP CORP$155.54
3/19/21 CMPCOMPASS MINERALS INTERNATIONAL INC$137.52
3/19/21 RRYDER SYSTEM INC$52.38
3/25/21 QCOMQUALCOMM INC$153.82
3/26/21 BPBP PLC SPONSORED ADR$8.26
3/26/21 KHCKRAFT HEINZ CO$9.20
3/26/21 LMTLOCKHEED MARTIN CORP$5.20
3/26/21 WMWASTE MANAGEMENT INC$41.50
3/30/21 TROWPRICE T ROWE GROUPS$16.44
3/31/21 ARCCARES CAPITAL CORP$470.39
3/31/21 BPYUBROOKFIELD PPTY REIT INC CL A$50.85
3/31/21 GATXGATX CORP$53.15
3/31/21 GRMNGARMIN LTD$61.81
3/31/21 NEWTNEWTEK BUSINESS SVCS CORP$397.89
3/31/21 PEPPEPSICO INC$52.18
3/31/21 WEYSWEYCO GROUP INC$24.85
3/31/21BEPBROOKFIELD RENEWABLE PARTNERS PARTNERSHIP$266.35
3/31/21M1 FinanceM1 DIVIDEND GROWTH ACCOUNT$34.72

Buys and Sells for the Week 3/26

Markets are trading sideways and not giving up much to main street investors. Still managed to find a couple worthy buys to keep me going, here are my buys for the week:

  1. Oil-Dri Corp. of America (ODC) – increased position –  Prices retreated on this micro-cap. Not a bargain basement sale but good enough for this market. Grabbed 6 shares @ $34.17 and a 3.04% yield.
  2. Telus Corporation (TU) – increased position –  Telus (TU) is looking to accelerate 5G investing and a recent stock offering to fund it. Not crazy about the share dilution but welcome the investment into 5G. Grabbed 9 shares @ $20.07 and a 4.88% yield.

Buys and Sells for the Week 3/19

It is always a good week when you get a dividend increase and Williams-Sonoma (WSM) came through for me with an 11% raise to put a smile on my face. Hunting for value in this market is still tough and I will continue to buy in small amounts, here are my buys for the week:

  1. AbbVie Inc. (ABBV) – increased position –  AbbVie stock price significantly dropped Wednesday after the FDA requested additional information to assess the benefit of their new drug Rinvoq. Grabbed 2 shares @ $103.40 and a 5.03% yield.
  2. Algonquin Power & Utilities (AQN) – increased position –  My fidelity brokerage account does not allow a DRIP into AQN and have to remember to pick up some additional shares on occasion to compensate. Grabbed 12 shares @ $15.46 and a 4.01% yield.

Buys and Sells for the Week 3/12

32,778…and the Dow keeps growing, more importantly the S&P 500 index closed at 3,943 and if this breaks into the 4000 range it may start even more momentum. As far as buys or sells for the week I chose to be a bystander and did nothing.

Lockheed Martin (LMT) had a decent price earlier in the week but I failed to take action. Merck (MRK) and Pepsico (PEP) remain priced to buy but I have full positions in those. It has been quite some time since I had a week where I missed buying anything. With luck next week may bring something.

Collecting AT&T Dividends in Retirement

It seems there are never a short supply of articles and blog posts on whether or not AT&T (T) deserves a position in your portfolio and it is either a love it or hate it topic. From my perspective, whether you do or do not own T depends on each person’s portfolio, investment strategy or financial position in life as no two people are in the exact same situation.

However, I do know of one person that utilizes the ownership of T for generating income in his retirement in a way that is slightly unique from what I have seen amongst other investors. The person I am referring to is my father-in-law.

If you ask any investor what the dividend yield is today and most would say around 7.3%. Ask my father-in-law and he would say 6%. It does no good trying to correct him (I tried) because he has a different spin on it and once you hear his story 6% will make sense.

When banks started paying miserly interest on CDs and money markets my father-in-law needed a better yielding investment to better fund his retirement and so began his hunt for better yield. One of the investments he chose was to invest a portion of his retirement savings into T with their oversized yield. Instead of going through a brokerage he opened a T DRIP account that is administered through Computershare. His reasoning for this was very simple, he knew that T had little dividend growth and had potential for not increasing at all. To compensate he had one simple need; to find a way to automatically collect 80 to 85% of the dividend and reinvest the remaining 15-20%. Essentially he resolved himself to live off a 6% yield and that is where the DRIP program steps in.

Computershare allowed him to do exactly what he was looking for that no brokerage was able to do. When setting up his account the investment form ask how you would like your dividends reinvested; partial or full. It was simple math at this point he just calculated how many whole shares were 85% of his investment that would pay out cash dividends. From there he would adjust the number annually guaranteeing a bigger paycheck every year.

The only reason I am aware of this technique was due to my father-in-law’s age and the fact everything moved to being online that he had recently asked I take over adjusting his annual percentage mix which I have proudly been doing on his behalf since 2019. To this day, he refuses direct deposit , loves to receive the check and has my wife drive him to the bank to cash it. The man truly loves his dividend checks.

One could argue you could follow a similar strategy simply using a 4 or 5% rule for your portfolio but this is about how he is generating growing income with one stock and not an entire portfolio. I actually think this approach is brilliant for high yield/low growth dividend payers. If my brokerage ever allowed a % payout I just might embrace it during my retirement.

Buys and Sells for the Week 3/5

31,496…If anyone said one year ago the Dow would blow through 31K I would have laughed at them. Recovering back to 29K or even touching 30K I thought was a slim possibility but I honestly did not expect a full recovery until the summer of this year. I don’t know if the markets are overheated but it just makes the hunt for weekly buys that much more of an adventure. Here are my buys for the week:

  1. Duke Energy (DUK) – increased position –  Friday morning was a slight reprieve on stock price. Grabbed 2 shares @ $86.40 and a 4.47% yield.
  2. Algonquin Power & Utilities (AQN) – increased position –  I have not seen the share price below $15 since October 2020. Grabbed 13 shares @ $14.96 and a 4.14% yield.

February Dividend Income

After 34 years of clocking in and out of work and religiously saving 10% annually in my 401K every year, in good times and bad, I have decided to share my monthly dividend income to show what regular saving and investing can accomplish.

Received my annual review at work and my raise was higher than expected.  Since I budgeted to max out my Roth IRA for the year, this is the first time I have ever increased my 401K savings rate from 10% to 11%.  This improved my annual saving rate to 24.6%.  Below is a new metric I decided to include in my monthly updates. You can see 2019 was the turning point in my saving rate and was the first full year I had no credit card and no mortgage debt.

2012201320142015201620172018201920202021
401K10%10%10%10%10%10%10%10%10%11%
Brokerage0.2%0.7%  0.5%0.8%1%3.7%4.0%4.2%
Roth IRA      1.9%5.4%8.3%9.4%
Total Saving Rate10.2%10.7%10.0%10.0%10.5%10.8%12.9%19.1%22.3%24.6%
10 Year Personal Annual Saving Rate

For the month of February I made $2,837.59; an increase of 9.94% versus this time last year. This increase is a bit illusionary as a couple of typical January payers were pushed into February. First was B&G Foods (BGS) who decided to pay on Feb. 1 instead of the end of the month. The second was Canadian Imperial Bank of Commerce (CM) who did pay a dividend in January however, due to the dividend reinvestment policy at Fidelity it was not credited to my account until February. 

Overall market valuations for the most part remained high. My consistent buys for the month were AbbVie (ABBV), Pepsico (PEP) and Verizon (VZ). I am now at a full position in all three and do not plan to buy any additional purchases. Going into March here are the stocks on my watch list; BCE Inc (BCE), Duke Energy (DUK), JM Smucker (SJM), and Lockheed Martin (LMT).

DateSymbolCompanyAmount
2/1/21BGSB&G FOODS INC$253.27
2/1/21CMCANADIAN IMPERIAL BANK OF COMMERCE$252.51
2/1/21GISGENERAL MILLS INC$77.45
2/1/21TAT&T INC$603.10
2/1/21VZVERIZON COMMUNICATIONS INC$35.15
2/4/21BLVVANGUARD BD INDEX FDS LONG TERM BOND$14.79
2/4/21VCLTVANGUARD SCOTTSDALE FUNDS LONG-TERM COR$15.65
2/5/21HYGISHARES TR IBOXX HI YD ETF$19.29
2/5/21PFFISHARES TR PFD AND INCM SEC$50.47
2/8/21APDAIR PRODUCTS AND CHEMICALS INC$30.06
2/16/21ABBVABBVIE INC$155.18
2/16/21HASHASBRO INC$31.20
2/16/21OHIOMEGA HEALTHCARE INVESTORS INC$722.72
2/16/21PGPROCTER AND GAMBLE CO$103.16
2/18/21PSECPROSPECT CAP CORP$155.54
2/22/21ARTNAARTESIAN RES CORP$189.48
2/26/21ODCOIL DRI CORP OF AMERICA$14.11
2/26/21SBRASABRA HEALTH CARE REIT INC$83.25
2/26/21WSMWILLIAMS-SONOMA INC$9.61
2/26/21M1 FinanceM1 DIVIDEND GROWTH ACCOUNT$21.60