September Dividend Update

ID-100188087It’s the end of the month again therefore it’s time for one of my favourite posts, which is to show my dividend income for the last month.

I love to post about dividends because these are a large part of the fuel in my FIRE Engine and are powering me to my Financial IndependenceI am really pleased to report that September was the second month in a row (and the fourth this year so far) where I received over £500. My income this September was also double the amount I received in September 2014.

COMPANYSIPPISATOTAL
TOTAL£327.45£213.14£540.59
BP£45.84£0.00£45.84
Barclays£21.54£0.00£21.54
BHP Billiton£96.61£99.83£196.44
Royal Dutch Shell£115.95£86.27£202.22
Unilever£47.48£27.01£74.49
Interest on Cash£0.03£0.03£0.06

The overall increase is a “stonking” 105.52%, but the really awesome number is the 61.98% increase in the dividends paid in my SIPP, as this increase is purely due to re-investment of dividends paid in the last 12 months. So, as a result of re-investing the dividends for a year, instead of spending it on more things I don’t need, I will receive (as long as the companies don’t cut their dividend) £127.89 every September from now onwards, in fact I will probably receive more than this as the companies are likely to increase their dividends paid each year. I think this increase really illustrates the beauty of dividend investing as I have received this 63% increase even though the value of the underlying shares have fallen in the last 6 months, and are now probably worth less than they were this time last year. In fact as a result of this fall in the price of the shares, I have the opportunity to buy more shares at this lower price and potentially get an even bigger increase in the dividends paid in September 2016.

This is what is meant by the snowball theory, which is that as your portfolio gets bigger it creates yet more income for you to re-invest and grow the snowball even further, until you have a snowball that will roll downhill all on it’s own.

The increase of 250% in my ISA is a result of the payments into this account I have been making throughout the year, and has really paid of with the increase of over £150, and once again will be repeated each September.

I am now on track to receive over £6,000 in dividend income this year, which is a quarter of the annual income that Mrs FIUK and I need to pack in working, so as I have a final salary pension, as does Mrs FIUK, I will need to fill the gap between stopping working and receiving our pensions for around 10 years and should be in a position to do this around my 58th birthday.

8 thoughts on “September Dividend Update

    1. Financial Independence UK Post author

      Hi FIbrarian

      Thanks for your comment, and yes it does give me a great buzz to see the money coming in each month, and even more so when it has accumulated to enough to buy more shares.

      Interesting last post of yours about when is work not worth the money as I am looking to escape my job as soon as I can because it is only worth the money because it is funding my retirement.

      Best Wishes
      FI UK

      Reply
    1. Financial Independence UK Post author

      Hi M

      Looks like your dividend income has taken a great step up in the second half of the year, mine is looking good for the rest of the year, and expecting a great year. As I always re-invest next year should see some good growth too, FI Day draws nearer.

      Best Wishes
      FI UK

      Reply
  1. weenie

    Hey FIUK

    That’s fantastic that you received over £500 in income and what a brilliant YOY increase – well done!
    Reinvesting the dividends to produce more – it does make the mind boggle how it will keep on increasing, despite the markets crashing all over the place!

    I’m only seeing small increases as I’m near the beginning of my investment journey but you’ve been at it a while so it must be so exciting for you to see such big increases, year on year! Keep up the great work!

    Reply
    1. Financial Independence UK Post author

      Hi Weenie

      Thanks for commenting.

      Hopefully posting my experience (along with lots of other bloggers) will illustrate how you can get to significant income by regularly investing into high quality dividend paying companies.

      It has taken a while to get here, but I can really see the day I can escape approaching.

      Good Luck on your FI journey
      FI UK

      Reply
    1. Financial Independence UK Post author

      Hi Sharon

      Thanks for dropping by and commenting. I do enjoy watching the dividend income grow, as it is these that will support my escape from the rat race.

      Best Wishes
      FI UK

      Reply

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