March Dividend Income

Posted on March 31, 2022 by SD Growth

After 35 years of clocking in and out of work and religiously saving at least 10% annually in my 401K every year, my countdown to financial independence is in sight. Each month is a step closer and let’s look at how this past month is getting me there.

For the month of March I made $5,343.37; an increase of 26.07% versus this time last year.

In March I received 4 dividend raises from AMNF, QCOM, WSM and WPC which is a far cry from the 20 I received last month but welcomed none the less.

On the home front my daughter received a stay of execution on her job as they received a late round of funding which should keep the company open for another year and the good news is she received a $10K retention bonus for being loyal. This takes a little stress off of her and myself.

At my place of work, I received my annual pay raise mid-month but it was pretty small in comparison to inflation. I did increase my 401K contribution by 1% but just could not swing an increase to my weekly M1 finance contribution. Even the 1% increase I am questioning as costs have risen but hey no pain no gain. This now brings my annual savings rate up to 25.9% from 24.9% last year.

	2022	2021	2020	2019	2018	2017	2016	2015	2014	2013
401K	12%	11%	10%	10%	10%	10%	10%	10%	10%	10%
Brokerage	4.50%	4.50%	4%	3.70%	1%	0.80%	0.50%			0.70%
Roth IRA	9.40%	9.40%	8.30%	5.40%	1.90%
Total Saving Rate	25.90%	24.90%	22.30%	19.10%	12.90%	10.80%	10.50%	10.00%	10.00%	10.70%

10 Year Savings Rate

Let’s see the things we all love to see…charts and dividend payouts:

Date	Symbol	Company	Amount
3/1/22	ALE	ALLETE INC	$137.32
3/1/22	NUSI	ETF SER SOLUTIONS NATIONWIDE NASDQ	$38.14
3/1/22	PNW	PINNACLE WEST CAPITAL CORP	$116.99
3/1/22	PSX	PHILLIPS 66	$27.09
3/1/22	SJM	SMUCKER J M CO	$17.81
3/2/22	FAST	FASTENAL	$12.76
3/2/22	XRMI	GLOBAL X FDS S&P 500 RISK	$52.77
3/3/22	CMI	CUMMINS INC	$40.74
3/3/22	DFS	DISCOVER FINANCIAL SERVICES	$12.95
3/3/22	ENB	ENBRIDGE INC	$249.40
3/3/22	VLO	VALERO ENERGY CORP	$35.28
3/4/22	BLV	VANGUARD BD INDEX FDS LONG TERM BOND	$13.34
3/4/22	PFE	PFIZER INC	$237.15
3/4/22	VCLT	VANGUARD SCOTTSDALE FUNDS LONG-TERM COR	$14.18
3/7/22	HYG	ISHARES TR IBOXX HI YD ETF	$19.47
3/7/22	PFF	ISHARES TR PFD AND INCM SEC	$43.10
3/7/22	SO	SOUTHERN CO	$67.50
3/8/22	AMGN	AMGEN INC	$11.66
3/8/22	JNJ	JOHNSON & JOHNSON	$185.52
3/10/22	CVX	CHEVRON CORP	$23.96
3/10/22	IBM	INTERNATIONAL BUS MACH CORP	$152.12
3/10/22	MSFT	MICROSOFT CORP	$67.69
3/10/22	SNA	SNAP-ON INC	$25.26
3/10/22	UPS	UNITED PARCEL SERVICE INC	$339.60
3/11/22	PRU	PRUDENTIAL FINANCIAL INC	$514.39
3/11/22	WBA	WALGREENS BOOTS ALLIANCE INC	$67.01
3/14/22	MMM	3M CO	$63.12
3/15/22	AVA	AVISTA CORP	$146.43
3/15/22	EPR	EPR PROPERTIES	$77.71
3/15/22	FAF	FIRST AMERICAN FINANCIAL CORP	$163.33
3/15/22	NWL	NEWELL BRANDS INC	$25.56
3/16/22	DUK	DUKE ENERGY CORP	$66.77
3/17/22	BHB	BAR HARBOR BANKSHARES	$49.50
3/17/22	OGN	ORGANON & CO	$5.65
3/18/22	R	RYDER SYSTEM INC	$54.57
3/21/22	CMP	COMPASS MINERALS INTERNATIONAL INC	$28.65
3/22/22	PSEC	PROSPECT CAP CORP	$155.54
3/24/22	QCOM	QUALCOMM INC	$160.93
3/24/22	UL	UNILEVER PLC SPON ADR	$61.97
3/25/22	BP	BP PLC SPONSORED ADR	$8.59
3/25/22	KHC	KRAFT HEINZ CO	$9.60
3/25/22	LMT	LOCKHEED MARTIN CORP	$25.63
3/30/22	TROW	PRICE T ROWE	$23.75
3/31/22	ARCC	ARES CAPITAL CORP	$551.61
3/31/22	AVGO	BROADCOM INC	$8.37
3/31/22	BEP	BROOKFIELD RENEWABLE PARTNERS	$280.60
3/31/22	CTO	CTO RLTY GROWTH INC	$61.62
3/31/22	GATX	GATX CORP	$55.27
3/31/22	NEWT	NEWTEK BUSINESS SVCS CORP	$537.50
3/31/22	PEP	PEPSICO INC	$56.40
3/31/22	WEYS	WEYCO GROUP INC	$25.90
3/31/22	WM	WASTE MANAGEMENT INC	$46.92
3/31/22	M1 Finance	M1 DIVIDEND GROWTH ACCOUNT	$68.68

Buys and Sells for the Week 3/25

Posted on March 25, 2022 by SD Growth

Yet another dividend raise with a raise from Armanino Foods of Distinction (AMNF) coming in at 9.09%, 2022 is turning out to be a great year! Here are my trades for the week:

Hasbro (HAS) – increased position – Share price keeps dropping and I keep buying. Grabbed 2 shares @ $84.56 and a 3.31% yield.
Best Buy (BBY) – new position – Bought this after the ex-dividend date so I have a whole quarter to build this position that is more than 30% off its 52 week high. Grabbed 4 shares @ $96.06 and a 3.66% yield.

Buys and Sells for the Week 3/18

Posted on March 18, 2022 by SD Growth

I had four limit orders to buy hoping for further prices drops but none triggered. Guess I’ll have wait on APD, SJM, SNA, and UL for another week. No buys aside I did get another dividend raise, this time from Williams-Sonoma (WSM) who delivered a beautiful raise of 9.86%.

Sorry to disappoint anyone hoping to see some buys but at least you saw 4 stocks I am interested in. Some additional stocks I like include A.O. Smith Corp (AOS), Best Buy (BBY), and T. Rowe Price (TROW).

Reimagining my Emergency Fund in Retirement

Posted on March 12, 2022 by SD Growth

(note: this is part 2 to the previous post “Cost of Getting Old”)

Up to this point of my career, my emergency fund had one simple focus; to mitigate the risk of income loss. I kept 2 months’ worth of expenses in cash and the rest I poured into the stock market in the hopes that a combination of unemployment benefits, severance pay, emergency cash, and dividend income I could cover 6 months of expenses until I found a new job.

However, this changed after I turned 50 and retirement was suddenly in view. I am not naïve to believe ageism or age discrimination does not exist. I knew going forward if I lose income from my job the odds of bouncing back and finding new employment were stacked against me. At this point, prior to collecting social security, my only source of income would come from dividends so I would need to mitigate for a market crash and high inflation. My current emergency fund was not setup for this and needed to be reevaluated.

I analyzed my portfolio against different market conditions for crashes and time periods for inflation. In a quick summary, I discovered my portfolio could suffer a 30% cut in income and it could take up to 4 years to recover. At the end of the day, for my portfolio to weather that period I determined I would need the equivalent of 9 months of expenses in cash and developed a plan on how to fund it. Of course life is not just about stock market performance, there are also unplanned expenses like a new roof or furnace so I decided that I would also need a $10K rainy-day fund for these instances. This was cash I already on hand so I dismissed thinking about it any further. But this rainy-day fund is where I was wrong.

In determining my rainy-day fund, I was lazy and gave it little thought and I did not realize it until my recent experience with my father-in-law going into a nursing home leaving his children to make life altering financial and life decisions on his behalf. It was at this point I realized s $10K rainy-day fund was not even close to handle a situation like this. At a minimum I needed at least $45K (3 months of nursing home expenses). While I had concerns of how to fund this, I was more worried about the doubt creeping in if I was planning correctly.

As I was pondering my predicament I came across a video episode of Two Sides of FI where one of the vloggers (Jason) mentioned that for major repairs he amortizes the cost into his monthly expenses. His statement was like a concrete block being dropped on my head! With all my years looking at financial statements its not like I did not know what depreciation cycles were. I felt like a complete idiot for not viewing it this way. I need to reanalyze this and its not that hard.

Most of the major purchases we make have a defined or expected life before they need to be replaced and there is no reason to treat emergency care in the same fashion and amortize that cost assuming I will need the funds around age 75. Taking all of this into account here is the additional monthly expenses I need to account for:

Item	Useful Life (Yrs.)	Remaining Life (Yrs.)	Replacement Cost	Monthly amortized cost
Roof	25	11	$8,500	$64
Furnace or HVAC	20	19	$8,000	$35
Hot Water Tank	12	10	$800	$7
Washer and Dryer	11	6	$1,600	$22
Electric Stove	13	10	$800	$7
Car	8	7	$26,000	$310
Dishwasher	9	9	$600	$6
Emergency Care	–	22	$45,000	$170

Sub-Total Monthly Expense				$621
Minus Existing Cash			-$10,000	-$38
Total Monthly Expense				$583

There we have it, an additional $583 in monthly expenses or approximately $7K a year. Now I will need to revisit what my planned expenses were in retirement and add these figures. In theory it should increase my targeted dividend income I need for retirement. Though not good news I think it is better to find this out now rather than later and plan accordingly.

There is a quote from Alan Lakein that inspires me at times like this:

“Planning is bringing the future into the present so that you can do something about it today“

In other words I have the means to do something about it today while I will not have the means to fix it in the future,

Buys and Sells for the Week 3/11

Posted on March 11, 2022 by SD Growth

Dividend raises have slowed but still coming in from Qualcomm (QCOM) at 10.29% and I had to get my magnifying glass out to see the W.P. Carey (WPC) raise of 0.19%. Here are my trades for the week:

Air Products (APD) – increased position – Share price keeps dropping and I keep buying. Grabbed 2 shares @ $223.88 and a 2.89% yield.
Oil-Dri Corp. of America (ODC) – increased position – New 52 week lows. Grabbed 1 share @ $28.60 and a 3.78% yield.
Hasbro (HAS) – increased position – Pullback in price lets me toy around. Grabbed 1 share @ $88 and a 3.18% yield.

Cost of Getting Old

Posted on March 5, 2022 by SD Growth

(note: this is part 1 of a two part post)

In early December my wife had that dreaded middle of night phone call from her 89-year-old father. He fell in the night and couldn’t move and called in pain. My wife immediately called 911 and rushed to his house to meet the paramedics to bring him to the hospital.

The hospital still had COVID protocols that had limited access in place which meant I couldn’t meet my wife there and she would have to go this alone. After several days the hospital diagnosed him with having a broken bone in his neck and would require a neurosurgeon to advise for treatment. With no neurosurgeon available the hospital discharged her father to a nursing home. Shortly after being transferred to the nursing home, my wife discovered the entire neurosurgeon practice was closed and would not return until January. This meant at a minimum he would be at the nursing home for 2 months.

After 2 weeks in the nursing home my wife received a letter from Medicare that they would no longer pay for the cost and care in the nursing home. My wife and her two sisters were suddenly in panic mode and I could tell it was affecting their decision making. In the area we live nursing home costs on average run $15,000 per month. Thankfully my wife was levelheaded enough to explain that until they receive the neurosurgeon examination there was little that they could do (or change). My father-in-law had enough cash on hand to handle costs for a couple of months and the decision was postponed.

After the diagnosis from the neurosurgeon it was determined the break was inoperable. He would be in a cervical collar for the remainder of his life and will also have difficulty walking on his own or feeding himself in addition to his other frailties he had before the accident. It is now a level of care that is beyond our capabilities and long term care is his only option. At this point we have used the last of the cash and are now filling out the paperwork for Medicaid assistance (Title 19). My wife has been a caregiver to her parents for so long I can see this decision really hurt her emotionally. I can tell at times she feels that she has failed her father by not being able to care for him herself. I try not advise in times like this and try to just be there for her and provide a shoulder to lean on or lend an ear to listen. There is nothing easy about this, it is part of life, we just have to endure and be there for one another.

Throughout this time I kept placing myself in my father-in-law’s shoes and asked what could I have done that could have avoided some of this or made decision making much easier for my children?

My knee jerk reaction was to get long term insurance. It has been the generic advice that you can find in every finance article or recommended by most financial advisors as far back as I could remember. But as I researched long term care insurance, I discovered it not as beneficial as I had thought.

First let us begin with premiums. Most articles I found quoted premiums for someone my age at $3500/year (sounds reasonable) however, I discovered these quotes were from 4 to 5 years ago and the landscape has drastically changed. As the age 65 and above group rapidly expands with the baby boomers, many insurance companies are opting out of offering long term care insurance because of rising costs. The few insurance companies that remained have since doubled the annual premiums which are closer to $7,000 annually and if you have any pre-existing health condition they can deny you coverage. Of course, COVID has not made things easier and there is now speculation that premiums may increase to $11,000 annually.

The second big discovery I made was when and how much in claims are paid out. Insurance companies do not pay out the first 90 days of nursing home care, this is for a good reason. A large percentage of people admitted into a nursing home die within the first 90 days. Remember insurance companies have actuaries who predict this, the policy is geared toward their benefit not yours. Assuming you make it past the first 90 days and the policy kicks in, there is a cap of how much can be claimed and that typically falls in the $270K-$300K range. Going back to my area where nursing home prices are $15K/month that would equate to just 18 months of coverage.

What I thought was a simple slam dunk answer has suddenly become more complicated. Given the health care costs in my area as well as the fact that my wife would be denied for a pre-existing illness leaving just myself, long term insurance doesn’t seem to be the answer. Assuming I would sell my house if this ever happened to me, the funds from that plus my portfolio should be able to easily cover long term costs. Only concern is what to do until then as I would need some cash on hand until assets can be liquidated allowing my children to make stress free decision making. To do this I really need to re-think about my emergency fund.

(part 2: Reimagining my Emergency Fund in Retirement)

Buys and Sells for the Week 3/4

Posted on March 4, 2022 by SD Growth

March is staring off fairly quiet. Still not a lot of cash on my end but when I get it goes right into the market. Here are my trades for the week:

JM Smucker (SJM) – increased position – SJMs forecast for the remainder of the year was not well received and prices dropped. Grabbed 1 share @ $127.37 and a 3.11% yield.
Air Products (APD) – increased position – Too bad I didn’t hold out until Friday for a better share price. Grabbed 2 shares @ $231.47 and a 2.80% yield.

February Dividend Income

Posted on March 1, 2022 by SD Growth

Before I start this post, I just wanted to state it is hard for me to get excited about finances the last few days. There is so much tension and tragedy around Russia’s invasion of Ukraine to the point where it is depressing seeing it unfold. I know there are fellow international bloggers whose sites I visit regularly and their country borders or is near a border with Russia of which I cannot imagine how they feel as Russia is saber rattling to those countries like Sweden, Finland, and others. I have said my peace and will keep the Ukrainian people in my prayers. Now onto the monthly post…

For the month of February I made $3,006.83; an increase of 5.96% versus this time last year.

In February I received 20 dividend raises which is a new record for me as the most raises ever in a single month.

On the home front we are still dealing with health issues with extended family members. My oldest daughter was just notified her company is closing and her last day will be the end May. She is taking the news as best as she can, but my fear is with only 2 years of experience she may struggle to find a job.

The end of February is my annual review at work which went fairly well as I received a 4% raise which will kick in around mid March. I will most likely be redirecting some of that to future savings but not too much as 4% did not even cover inflation.