March’23 – Side Income Update

Hi there!

Hoping you are having the best days of your lives! If not, at least I wish you are trying to make it better and in the process, enjoying the journey. Afterall progress and growth is more important than hitting stagnancy and it helps a lot if you have a defined goal(s) for yourself. For us, March was a busy month for our restaurants as both establishments catered for almost 800 guests combined! Although we have fulltime managing partners at each place, I had to pitch in and help with both events on 2 consecutive weekends. We are still fairly new and hadn’t catered to this sized event yet hence we are on a learning roller-coaster gaining experience and insight. For both events combined, the menu was quite elaborate with 25+ food items for buffet including many variety of salads, appetizers, entrees and sweets. The events were a huge success in terms of customer satisfaction, praises we got for our food & most importantly follow-up customers that we attracted back to our businesses for their food needs. We aren’t making much money with our restaurant and grocers is bleeding quite heavily month-over-month and so it is quite stressful phase of many of our lives and trying to enjoy when we can and hoping for a brighter future for these initiatives.

Getting to this month’s business, please find below our March updates which as usual starts by updating below two pages with the latest data:

• 2025 Goal tracker on our homepage – At the beginning of 2023 we revised our 2025 passive income goals after careful consideration and keeping in mind heavy financial obligations we carry currently. You can read more about it here under our 2025 goals
• Dividend Portfolio with our latest holdings. We are aggressively modifying our holdings to align more with growth mindset instead of income at present.

Passive Income Pie

Monthly Dividend Earnings

While Jan’23 gave us an all time high dividends, Feb’23 was quite dull and in the midst, March is not that bad as compared! I would prefer less variations but this isn’t a big deal as when we get into consumption phase, we would have 3-6 months of emergency funds handy and these monthly dividends will just be added to that pool for our daily needs. Besides majority of good companies pay in Jan-Apr-Jul-Oct months as their quarter ends on Mar-Jun-Sept-Dec months.

Key highlights from this month’s dividend income are:

• We received dividend deposits from a 20 different companies (17 Canadian & 3 US), with total value of $810.29, a 26% YoY increase from Mar’22
• For ease and simplicity, we consider 1 CAD = 1 USD
• Top 3 dividend contributors were Enbridge, Pembina pipelines and Suncor
• We dripped 12 shares in total – 3 from Enbridge, 2 each from Manulife, Pembina pipelines and Suncor & 1 each from Pizza Pizza, Plaza REIT & Whitecap Resources
• We received 6 dividend raises this month: Canadian National Railway: 7.85%, Enbridge: 3.2%, Equitable Bank: 6.06%, Manulife Insurance: 11%, Metro: 10% & Plaza REIT: 0.13%
• Average monthly dividends for 2023 so far is $784.68 or about $26 a day. By 2025, we aim to reach $1500 monthly (or $50 daily)

Dividend Goal Tracker – Planned vs Actual

Our aspirational dividend earnings for this year is $12000 and three months into the year, we achieved about 20% of our goal. Due to other financial commitments, the money is quite tight right now for investing and the skyrocketing rate of interest isn’t making sense anymore to invest from available line of credits. Hence investment strategy for this year is a pain – We saves as much money as possible from our day jobs, then divert a major portion of that savings immediately towards paying off high interest debts & with a much smaller portion we invest under our TFSA accounts to narrow down the wide contribution limit gap! Most of our buys under TFSA are focused on companies with low yield but with a track record of double digits dividend growth over past 5 years minimum. While many don’t like significant debt, we are not that uncomfortable with it and hence are still trying to maintain a fine balance between debt repayment & investing. Readers may know we carry a significant debt right now which was taken to fund couple of businesses. This situation forced us to reduce our 2025 dividend goals from $30000 to $18000 and if the businesses continue to demand additional capital, we may even have to sell some/all of our TFSA holdings.

My Marketplace

This was an unusually busy month for both BUYING & SELLING! We closed our Bank of Nova Scotia (TSE:BNS) position after holding it for 4 years. While the dividend yield was juicy with just over 6%, which was increased by 14.11% in 2022, but what got me frustrated was the price which declined 16% in past 5 years. The dividend yield or the raise wasn’t enough to keep my interest going. We also sold Northland Power Inc (TSE:NPI) whose last dividend raise was back in Jan’18 of 11.11% and this itself was enough to exit our position. Another position we exited was Maxar Technologies (TSE:MAXR) which appreciated more than double post the new of their acquisition. We just had 50 shares left and they were also free and hence the exit was quite satisfying. Our final sell was Suncor Energy Inc (TSE:SU) which we partially sold to book some profits after their recent bull run due to increase in crude oil appreciation. We still have a partial position which we will continue to hold.

With significant sell proceeds, we added Waste Connections Inc (TSE:WCN) to our existing position & started new positions for Canadian Natural Resources Ltd (TSE:CNQ), Enghouse Systems Ltd (TSE:ENGH) and Intact Financial Corp (TSE:IFC). All these companies have low dividend yield but have a history of double digit dividend growth & CAGR over past 5-10 years and hence I believe have a good runway for growth over coming years. We also continued accumulating CIBC (TSE:CM) under automated bi-weekly contributions going straight into my RRSP account. And finally we also used the incoming dividends to buy fractional shares of Equitable Bank Inc (TSE:EQB) & Metro Inc (TSE:MRU) under our TFSA accounts.

We also dripped 12 additional shares and received dividend raises from 6 companies we hold which contributed to a bit as well to our Projected Annual Dividend Income (PADI) for the month, which in total increased by $21.91, not a huge amount but by giving it time and being disciplined & determination, we should see much bigger increases in next few years.

For fractional buys we use WealthSimple which is a zero-commission stock trading platform and hence putting our money immediately to work for us. If you don’t have WS Account and would like to try them out, you can use my WealthSimple referral link to earn $5-$3000 to invest in stocks!

On Crypto front, we did nothing at all in entire 2022 and don’t think I have any funds or appetite to deploy any more than what we currently have. Last year was pretty rough year for cryptocurrencies both in terms of price depreciation & many providers declaring bankruptcy. Unfortunately Celsius network was one such platform on which we had all our Bitcoin & Ethereum holdings and since August of 2022 they have stopped paying interests on holding cryptos & even withdrawals from their platform is halted. So money is stuck there, let’s see when we could recover our holdings. Once we are able to recover our money, we will redeploy on CoinSquare platform which apparently hold the fort pretty well when others kept collapsing! Also, once our financial situation improves we will resume investing in cryptocurrencies.

Rental Earnings

The cashflow is calculated by subtracting rent collected by all expenses including but not limited to mortgage, property tax, insurance, utilities and repairs (if any). These numbers don’t exactly translate on tax filing as I don’t take into consideration the interests we pay to the bank for mortgage or on any other loan we took to renovate the property. I do the final calculation at the time of tax season and don’t intent to share it here. The net cashflow for all our properties for the month are as below:

Principal residence – We rent out a portion of our basement which is legally built as a second unit and we occupy upstairs with a portion of the basement, for which we add $2500 as rent payable by us for our dwelling. The net cashflow from our principal residence for this month is -$575.44 which is lower than usual as we have to pay property taxes in Feb-Mar-Apr-Jul-Aug-Sept months, which eats up the cashflow. I know the picture doesn’t look rosy but imagine bearing all the cost by ourselves with $0 external support in this high interest market!

Investment property 1 – Net cashflow from this property for this month is $920.72 and this property acts as a backbone to many of our financial needs including paying off the interests for all outstanding line of credits. Once the real estate market improves I plan to test the waters by putting this house for sale and see what is being offered. Depending on it we may sell it and consolidate some of the debt we carry, I will keep you’ll posted!

Investment property 2 – The net cashflow from this property for the month is $390.28. If you followed us in Jan’23, you will know that this house was purchased in equal partnership with a friend of mine and hence I am only going to consider 50% of the income/loss. Our near term (2-4 years) intention with this house is to sell and book profit for which we will wait for the market to improve, no rush.

Lending Interest Earnings

We earned $13.01 in total interests this month from several lending loop commitments (loans) worth combined total of $2000 dumped back in 2019. It fluctuates a bit on monthly basis but no complains for now. At present both principal and interest amounts are insignificant but if I have spare cash, I would surely lend more on this platform. 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.

That’s it for now readers for this month and I hope our journey irrespective of the baby steps, help you in some way. Please do subscribe using the widget at the bottom of the page to get our once a month update, I don’t spam and you will only get an email or two in a month, whenever I post on this website.

Stay safe, stay cool, and most importantly Save-Invest-Repeat! 😊