December’20 – Year End Passive Income update!

Hi there! First of all.. I wish you and yours’ a very Happy New Year, hope this year let you achieve whatever you aim for, be it spiritual or materialistic. Finally 2020 ended and oh boy.. what a year we all witnessed! I am sure most of us will remember this year for a long long time and will have many interesting incidents and stories to share with our grandchildren. Personally we were not impacted at all by this ongoing pandemic and hope it end soon but this whole situation makes us realize how lucky we are and are thankful to the invisible power behind it! In fact this realization lead me to kickstart following two blogs:

1. Gratitude & Goodness – Write one gratitude (or something good in life) for each week of 2021! I plan to append one paragraph every week, please do visit when you get a chance. 😊
2. Sharing with Society – Measured yet thoughtful approach towards helping an organization or an individual in need, all year long. ✌️

Now getting back to business, as I mentioned last time, we achieved our 2020 dividend goal in November itself and our portfolio attained a milestone of crossing $150K mark! As usual, our monthly update begins with updating below two areas with the latest data:

• 2025 Goal tracker on homepage
• Dividend Portfolio with latest holdings

Passive Income Pie

Monthly Dividend Earnings

We ended 2020 crossing $6000 in annual dividend and it was the first time ever in my life, hope to continue this journey and keeping beating our goals, year after year. Key points from this month’s dividend income are:

• We received dividend deposits from total 20 companies (18 Canadian & 2 US), with total value of $581.62
• Dripped 12 additional shares for Brookfield Property, Diversified Royalty, Enbridge, Exxon Mobil, Pizza Pizza, Plaza REIT & Suncor
• Received increased dividends from: Alimentation Couche-Tard 25%, Fortis 5.8% and OTEX 15%

Dividend Goal Tracker – Planned vs Actual

We beat 2020 dividend goal by $658 which gives us the much needed headstart for 2021 goal of $8500 in dividends. As per our Dividend Portfolio, the projected annual dividend earning is just over $7000, so we are short by $1500 to attain our laid out goal. If we consider achieving the goal by pumping new money only (the worst case scenario), then at a healthy yield of 4%, we will need to contribute additional $37,500. Looking at our debt situation, most of our savings this year will go towards paying off the debts and hence contributing to dividend portfolio will be quite challenging. Apart from regular payroll deduction under RRSP, we can probably look at adding some funds in TFSA or take yet another loan for RRSP. On the other hand, we have many quality stocks and upcoming dividend raises and drips will surely help us narrow down the gap. The good part about dividend investing for us is we have no plan to take out any money any time soon and we also have ample contribution room under both TFSA & RRSP. In short, the 2021 journey is steep but not unattainable.🤞

My Marketplace

George Soros said – If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring. I strictly followed his philosophy this month and stayed away from the market and news, most of the time. I just kept accumulating CIBC shares as part of my regular contributions in RRSP through my employer.

Rental Earnings

There was no change in cash flow from the rental property in which we have 50% ownership. After deducting mortgage & maintenance fee from the rent, the property gives us $180, and if we split two ways then our shares is $90. We let the money accumulate in our joint bank account and it is mostly used for the property tax installments; factoring this we are losing about $100 a month. This doesn’t include any random tap leak or heat malfunctioning or any other issue with the property. There is an upcoming kitchen cabinet change and some other cosmetic repairs, which will further drain money. Having said this, we still believe we are doing pretty well as based on few comparables, this property shows a price appreciation of 25% already in just 1 year. If you keep a tab on GTA real estate market, you will know the madness, it is much hot and surely more exciting than stock market! To give you an example, a house was sold in the end of 22-Sept-20 for $790,000 after which they renovated and sold again on 4-Jan-21 for $998,000, got sold in just 1 day! The signage in the front lawn proudly boasts – Sold at highest price on the street! Even if the buyer spent $100,000 (which is quite lavish) for the renovation work and 3 months of mortgage, they still earned $100,000 in 3 months. This property is on the same street we bought a house, also back in Sept’20 and are awaiting legal basement permit. We have no plan to sell it anytime soon but are eagerly waiting for it to start bearing fruit.

Lending Interest Earnings

The interest we received reduced yet another month as we are paying half of the incoming interest towards various line of credit accounts. This income stream is going to end up in a month or two as the contract is coming to an end, we will use the proceed to pay off some of our debt. Once we are financially comfortable I totally want to get back to this yet again.

This is a wrap for 2020 and overall we are quite pleased with our achievements. We are super excited and looking forward to 2021 and its offering. Thank you for being part of our journey and once again we wish you and your family a great new year. Please subscribe using the widget at the bottom of the page to get monthly updates, I don’t spam and you will only get an email whenever I post on this website. Stay indoor, Stay safe and Save-Invest-Repeat. 😊