September has been and gone, so I can now update my dividend performance for the month. I have again managed to achieve an increase from the same month last year for both my SIPP and my ISA (£263.02 compared to only £172.84 last year). Although the amount is nowhere near last months massive milestone, a 52.18% increase is still way above inflation and definitely not to be sniffed at. If I was now living off of just my investment income (the holy grail of Financial Independence) I would have increased my real income once more this month.
COMPANY SIPP ISA TOTAL
£202.14 £60.88 £263.02
Unilever £27.04 £28.39 £55.42
BP £41.72 £0.00 £41.72
Barclays £21.54 £0.00 £21.54
Royal Dutch Shell £81.45 £32.49 £113.94
BHP Billiton £30.40 £0.00 £30.40
Last September I didn’t receive any income in my ISA, and this year I have received £60.88 which is due to my purchases of Unilever and Royal Dutch Shell, both of which I would anticipate increasing their dividend over a five year period and as I am currently in dividend re-investment mode, the quarterly payments are currently adding four shares per year to each of these companies, which will further increase the payments (the only potential problem is that the pound has recently been strong against the Euro and the Dollar, and as these companies calculate their dividends in one of these currencies, my Stirling income may actually drop).
All of the increase in my SIPP is again mainly due to re-investment of my dividends into additional Unilever shares and a new purchase recently in BHP Billiton. It is really encouraging to be able to achieve a 16.95% increase in my income for this September compared to last year when I know I have not had to invest any additional money to achieve this. This benefit will increase over the years as with the additional shares contributing more income I will be able to buy an increasing value of shares and therefore yet more dividend income (the snowball growth accelerating).
I do hope that me commenting on my experience of being able to increase my income is useful to new income investors, as I can recall when my dividend income was less for the full year than the income for most of the individual months this year, and the growth seemed to be really slow. This highlights how if you can maintain your investing over a significant period of time the benefits will only really become apparent after several years. My current monthly average SIPP income is now greater than my annual SIPP income was only 9 years ago, and this is despite having not actually added any money to my SIPP for over three years. I have however created almost £1,000 per year income from my ISA in those three years from the £20k I have been able to save in those three years (my first years ISA income was £28.50 in 2011)
I am now using the motivation that this experience of income growth has given me to maintain my discipline in setting aside reasonably significant amounts of my salary to bring my FI date ever nearer.