Happy New Year! I wish and hope this new year brings new light in your lives and it lets you achieve whatever you aspire for from your life.
New years are often tagged to new goals and resolutions, and 2022 for us particularly comes up with high hopes and expectations. This year is of extreme significance financially and I realize so much need to be accomplished including seeing one business get into profit, another business get up and running, buy another investment property (solo or partnership), try to close the TFSA contribution gap as much as possible, attain $300K portfolio valuation, hit $12K in annual dividends! The last two aspirations will become reality on its own if we are able to invest about $50K in our TFSA accounts. This year is probably one of the most important in recent years, let’s see how it goes! 🤞
December as usual is an exciting month in my 9-5 world, we get to know our annual salary raise and also get our bonus. Banking sectors did very well in 2021 especially mortgage and personal loan areas boomed due to low interest rate. Consumer debts are at all time high and people are borrowing to invest or buy properties, fueling the price to unrealistic valuations. We received larger than normal raise and also a generous bonus. Normally I route the bonus money directly to RRSP as it saves tax now (..of course to be paid later at withdrawal) but as my aim is to eliminate our lifetime TFSA contribution limits, I chose to take the cash with about 43% upfront tax deduction and put the money in our TFSA accounts and a bit to buy cryptocurrencies. It sucks to pay this much in taxes but my thought process towards RRSP changed ever since I read Tawcan’s interview series with a couple earning $30K in monthly tax efficient dividends, their recommendation was to give priority to TFSA over RRSP for long term benefits.
I realize once again we are super late with our monthly updates and needless to say the beginning of year was super-busy with so much going on. Without further delay, here’s our monthly updates for December, which as usual starts by updating below two pages with the latest data:
- 2025 Goal tracker on homepage – Overall passive income for the year is taking a toll due to negative cashflow with our rental property!
- Dividend Portfolio with latest holdings
Passive Income Pie
This month, our passive income split comprised of 96% of Dividends and 4% in Interests from Lending loop & Celsius. We again did not had any positive cash-flow from our rental property.
As many of our regular readers may know that amidst 2020 Covid lockdown, we carefully put together our 2025 financial goals, which was based on the foundation of diversified and sustainable long term semi-passive incomes. Our income sources include 3 different areas as mentioned below along with percentage split, which we plan to attain by 2025.
- Rental Income – 45% – $3000 per month
- Dividends – 40% – $2500 per month
- Lending Interest – 15% – $1000 per month
So far the reality is far from the plan but we will work on smoothening out the ratios and increasing our earnings in each of the categories. Back in 2021 we also partnered with few of our friends to wet our toe into a restaurant & grocery businesses. A lot of funds went into these businesses and while the restaurant is operational since Sept’21 the grocery store is still in planning phase and we aim to open by Apr’22. Once we are clear on the cash-flow, I will add it to the diversity pie and adjust various income percentages accordingly.
Monthly Dividend Earnings
Nov’21 was quite a slow dividend month for us and we didn’t even reach $200 mark. Comparatively Dec’21 is a much better month, key points from this month’s dividend income are:
- We received dividend deposits from a whopping 23 different entities (21 Canadian & 2 US), with total value of $579.59, a 0.35% decrease from Dec’20
- For ease and simplicity, I consider USD at par with CAD
- Top 3 dividend contributors were Enbridge, Suncor and Exxon Mobil
- We dripped 7 shares in total – 2 Enbridge and 1 each for Diversified Royalty, Pizza Pizza, Plaza REIT, Suncor & Sylogist
- We received dividend raises from astounding 7 companies this month: Suncor – 100%, Alimentation Couche-Tard – 25.71%, Manulife – 18%, Fortis – 5.94%, Diversified Royalty – 4.57%, OTEX – 2.11% & Exxon Mobil – 1.15%. This is the most raises we ever received, before this we got 5 increases in Sept’21
- We also received a special dividend of $5 from A&W for holding 100 shares!
- Average monthly dividends for 2021 is $564.58 or about $18.56 a day. By 2025, we aim to reach $2500 monthly (or about $80 daily).
Dividend Goal Tracker – Planned vs Actual
In 2020 we beat dividend goal by achieving 112% against planned target but in 2021 we could reach only 80% of our goal. While it is a bit disheartening not to achieve our goals, we reached new highs in annual dividend income. We also know the reasons why we didn’t meet so it is not a complete disaster! As I mentioned in many of our past monthly updates, we invested significant money towards two businesses and hence couldn’t focus much on investing in dividend earning stocks. Besides we also changed our dividend investing strategy a bit by focusing more on growth stocks (with less to no yield) instead of high dividend payers. Both these factors contributed towards us not meeting the annual goal. Our strategy will remain more or less the same for 2022 as well and hence we will update our long term 2025 goals accordingly at a suitable time.
My Marketplace
It was a busy month in terms of Buy-Sell and also as mentioned above, DRIPs & Dividend raises. With all the dividend increases itself, our Projected Annual Dividend Income (PADI) increased by $199.04, this is the main reason why we are refocusing on dividend growth stocks for next few years and accumulate as many high dividend growers as we can! With 7 dripped shares from different companies, it also increased our PADI by another $10.28. So basically we increased our annual dividend by $209.32 by doing nothing and that’s the beauty of dividend investing that many don’t understand. It surely requires determination, discipline and patience to see the results.
This month we sold Viemed Healthcare & Banxa Holdings – both were small and speculative positions with no dividends. While Viemed was sold at a profit of 8.65%, Banxa returned us 27.85% on our investment. The proceeds along with accumulated dividends were used to buy – 42 shares of Manulife ($55.44 in annual dividend), 10 shares of Pembina pipelines ($25.20 in annual dividend), 54 shares of Suncor ($90.72 in annual dividend), 25 shares of Royal bank ($120 in annual dividend) & 23 shares of Enbridge ($79.12 in annual dividend). These buys will contribute total of $370.48 towards our PADI and since all these transactions were in our TFSA accounts, neither the price appreciation nor the dividend earnings have any tax burden on us in future!
Lastly, our automated bi-weekly payroll deduction in RRSP account bought us 2.33 CIBC shares ($13.61 in annual dividends). And our bi-weekly payday contribution of $500 to WealthSimple TFSA accounts (Self & wife) bought us – 6 shares of Equitable Bank ($4.44 in annual dividend), 0.57 shares of Royal bank ($2.74 in annual dividend) in my account & 6 shares of Metro Inc ($6 in annual dividend), 1.3 shares of Brookfield Asset Management ($0.68 in annual dividend) in wife’s account. All four stocks we picked are solid growth stocks with proven track record and rich history of dividend raises, we will see how it goes before making any adjustments. For readers who don’t know, we opened WealthSimple TFSA accounts in Nov’21 to buy stocks on bi-weekly basis to expedite our TFSA contribution and exhaust the limit. The purchases with WealthSimple are commission free and they also support fractional stock buying meaning you can also start regular investment for as little as $1, feel free to sign-up using our WealthSimple referral link to get 2 stocks valued up to $4500. We live in a pretty exciting time where platforms like them provide us an opportunity to be part of stock world for a paltry sum, there is no excuse to start building your future, today!
All the Buys (manual & automated), DRIPs and Dividend raises in Dec’21 increased our projected annual dividend earnings by $607.26 brining our total projected income to $7783.90!
On Crypto front, we put my 2021 Christmas bonus money to use and contributed $1000 to buy Ethereum & $500 towards Bitcoin. If you haven’t tracked crypto market lately, let me tell you majority of the cryptocurrencies have dropped 30%-40% each in last couple of months! I plan to continue adding to my these positions especially Bitcoin whenever I have some spare money, till the valuation reaches 5% of our total investment. I don’t intend to put anymore and also I will officially start tracking under our portfolio once combined crypto valuation reaches $10,000 or more. Our Bitcoin, Ethereum and Dogecoin are currently stored under two separate wallets CoinSquare & Celsius. I am using CoinSquare to buy currencies and then transfer it over to Celsius, which pays weekly interests on crypto holdings. Feel free to sign-up using my Celsius network referral and we both can earn $50 in Bitcoins once you transfer $400 or more. They also have regular promos to earn in-kind currency when you transfer them from other wallets. There are ongoing Ethereum promos to earn $20 when you transfer $500, $200 when you transfer $5000 or $600 when you transfer $20000 worth of Ethereum; all these amounts are in USD.
As I mentioned in our one of our past monthly update, I tried my hands at crypto mining and hopefully one day I will be able to spare some money towards building a mining rig to efficiently mine and earn. A good write-up/recording is available here if you want to read or listen. If this interests you, feel free to use my CudoMiner referral link and give it a try yourself, who knows you might get hooked up and take mining seriously and it could become one of your stable source of income!
Rental Earnings
Principal residence – We collected $1200 in rent from our basement apartment tenant which went right away towards paying off debt (mostly interest and a bit of principal) we accumulated to build the basement. Even though the basement is not generating a positive cashflow and mostly the rent just offset expenses, we still count this rent as an earning.
Investment property 1 – We have incurred heavy debt throughout 2021 since our previous tenant didn’t paid the rent for 5 months and we spent money in December to add another bedroom (..carved out of huge living room), painting & cleaning. We also finalized our upstairs tenant who will start renting the place from 1-Jan onwards and have already completed the paperwork. After months of going through agony and frustration, finally this property will be back on track with positive cash-flow, well the incoming rent will go towards the debt repayment but we are still happy! Addition of the third bedroom was instinctive and now when we think about it, it was worth to spend $7500 to reap long term price appreciation and valuation of the property.
Lending Interest Earnings
This month we earned $13.99 in interest from various lending loop commitments (loan) on our initial investment of $2000. Our annual return is close to 13.5% which isn’t bad for little diversification. You can also explore this option with a smaller capital and if you invest, we both can earn $25 each using our lending loop referral ink, once you invest $1,500 on their platform.
We also earned $7.76 in interests for keeping our Bitcoin on Celsius network. Celsius can not only be used to trade crypto but also to earn interest on the holding. I wasn’t aware of this platform and recently opened an account, transferred a bit of our Bitcoin from another wallet and started earning weekly interests. It is good to have another source of earning, no matter how small it is in the beginning. You can sign-up using our Celsius network referral link when signing up and can earn $50 in BTC with your first transfer of $400 or more.
Lastly, our sharing with society initiative continued and although we achieved our 2021 target in Oct itself, we continued sharing our good fortune with society. If you are not aware, we took a resolution to giveaway 10% of our previous year’s passive income towards a good cause. Please check our page sharing with society for more details and do share if you can with any of the charities or initiative we donated, it will mean a lot to us and keep in mind, even a small amount helps!
That’s it for now readers and see you next month! Please do 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 or two in a month, whenever I post on this website.
Stay safe, Take it easy and Save-Invest-Repeat! 😊
