Tuesday, September 27, 2016

September 2016 Dividend Growth Watchlist

My Motif account is working again for me so I am able to put my watchlist into a Motif and watch how it does over time.  This month I had it put together weeks ago but havn't had time to write about it until now (almost October).

The list hasn't changed much and all of these are great buys for the market we are currently in.  The biggest surprise was that Flowers Foods (FLO) finally creaped into the DFG watchlist.  The chart below is all data from the beginning of the month so I am sure some things have changed.  What hasn't changed is all these companies paying dividends for over 10 years and still going.

Many of these companies are on other DGI watchlists out there so I am starting to have a little faith in the ol' DFG Stock Screen.  SPAN seems to be one that no one talks about because of it's size I am guessing.  However at 17 years it is doing far better as a dividend growth stock than some big guys like Cisco.

Company Name
Symbol
Industry
No. Years
Dividend Yield
Sector
EPS% Payout
Cracker Barrel Old Country
CBRL
Restaurants
14
3.02
Consumer Discretionary
59.66
Span-America Medical Systems
SPAN
Medical Equipment
17
3.60
Health Care
43.84
Old Republic International
ORI
Insurance
35
3.90
Financials
49.02
Donegal Group Inc. A
DGICA
Insurance
14
3.42
Financials
52.88
T. Rowe Price Group
TROW
Financial Services
30
3.11
Financials
52.17
Target Corp.
TGT
Retail-Discount
49
3.42
Consumer Discretionary
46.60
Cummins Inc.
CMI
Machinery
11
3.26
Industrials
55.93
Gap Inc.
GPS
Retail-Clothing
11
3.70
Consumer Discretionary
51.98
Qualcomm Inc.
QCOM
Telecomm Equipment
14
3.36
Information Tech
62.17
Flowers Foods
FLO
Food Processing
15
4.29
Consumer Staples
72.73

Overall this group of stocks has been under-performing for the month compared to the rest of the S&P 500.  But that is OK.  It means they will still be a decent bargain when I get some cash from other dividends to purchase these companies.

Almost 11 so gotta go and catch some zzzs before starting the grind again tomorrow.

Happy investing,
Dividend Family Guy

 

Thursday, September 22, 2016

August 2016 FrugalMaster Results

Exercising my muscles with the FrugalMaster is hard work especially when you go on vacation.  We headed to the beach in August and only ate out every other day.  This kept us within the budget I had set (and saved for).  There are some changes this month so let's see if I came out ahead.

Income was below normal

This is the change I was talking about above.  My company makes you wait six months before you can put money into their 401k.  Even after that they won't even do a company match until you have been there a year.  Initially I was not going to put anything in until next year but then I would miss out on any tax savings by reducing my income. 

With that said half way through August it kicked in and sure enough my income is greatly reduced.  Greatly because I am trying to max it out (20%) with the remaining paychecks this year.  I put on hold my emergency fund savings and all vacations are done so I am not saving for vacation until next year.

I am also doing this because my previous model of see what I have left over each month to invest just wasn't working.  The switch to a pay yourself first model does work.  You can't spend or budget for money you never see.  So with the reduced income the term budgeting will take on more meaning as there will be no money to pay bills if I overspend.

Needs were within budget



eSurance once again gave me more money back.  To the tune of $89.27 for adjustments after they came and looked at my house.  I guess to rebuild my house doesn't cost as much as it used to.  We did go over in food again by $20.  I attribute that to the week of groceries I bought while on vacation.  The cost of living in a tourist trap town is way more than my lovely suburb in Ohio.  I will say the Kroger grocery store we went to was kind enough to let us use their savings card without having to sign up for it.  That did save us a good chunk of change so it all worked out.

I think I about lost it with the water bill for August and the subsequent sewer bill in September.  The cost of water for a family of 7 is now running me a grand WTF of $267 a month.  I remind my family daily to take 10 minute showers and don't just let the water run while your day dreaming.  We had switched to a HE top load washer late last year with little effect on the water bill.  In fact I think my wife does more loads than last year.  Either she is doing smaller loads or the kids are dirtying their clothes at a faster rate.  That leaves the old toilets.  They probably use 3-5 gallons a flush.  I know I need to swap them out.  However with the baby and young kids it is hard to get time to do it.

In the end we were $500 under budget and our needs as a percentage of our income improved YOY to 74%.  I need to drop that to about 25% by dropping my expensive house.  Still working on my lovely wife on that one.

Guilt Free Spending Money (Wants) was under budget

GFSP was supper low this month at $55.  Mostly because my savings for vacation took care of that expense.  I look forward to the day when it is $0 knowing I will have attained enlightenment and a good mustache.
 
Even with the beach vacation my savings rate still remained positive at 13%

The lower income and vacation expenses didn't stop me from saving.  I will take it as a good chunk went into my 401k and I still had 13% left over.  I continue to sweep all savings into a cash account.  My eye is on the hunt for a large enough home for the family and meets approval from my wife.  The big thing for me is we have to pay for it with cash.  No longer will I bow down to debt.  My soul craves to be free and our mortgage is the last thing tying me down.



Hopefully you have the same feeling and that is what keeps you going.

Kind regards,

Dividend Family Guy

Monday, September 19, 2016

Murphy Oil Sale

Murphy Oil (MUR) is the first cut of the year for me and last one since KMI.  It was purchased when I was a Motif customer group together with 9 other dividend growth stocks in a November purchase (see Motif below).  There is always a risk when you play in the energy area.  Almost all have either frozen or cut dividends. 

Who would have guessed that oil prices would stay this low for an extended period of time.  My fuel costs for this year are at an all time low allowing me to save more.  Unfortunately my portfolio only has room for dividend growth stocks.  I used one of my free trades from Merrill so overall I broke even on my short run with them.  Bye bye Murphy Oil I won't miss you.

Did any of you drop them with the dividend cut?  I am curious if the yield was enough to keep you with the company.

Happy investing,

Dividend Family Guy

 

Thursday, September 8, 2016

Frugaling Too Much?

I had big plans for tonight's dinner.  Homemade sweet and sour chicken with veggies, rice and noodles.  The chicken was a steal at $1.49 per pound for boneless breasts.  Things did not go as planned but maybe it was a sign.

Growing up with 1 sister and 5 brothers food was a scarce thing.  I remember my brothers and I eating as fast as we could so we could be the first to get whatever remained on the stove.  Rarely were there any leftovers.  I had my limits as a kid though and would slide some Brussel sprouts or liver under the table for the dog to devour.  Growing up my plate had to be clean to leave the table.  So food is a precious commodity to me.  I try never to waste it and often take leftovers to work for lunch.

This chicken though was pushing my limits of frugality.  The sell by date was the second and today is the seventh.  In retrospect I should have frozen it when I brought it home.  But today I pulled it out and decided we must eat it (and hopefully survive).  I have done it before but this chicken wasn't smelling to good.  I cubed it up anyway and mixed it in some marinade to kill some bacteria.

While it was marinating I got out a glass bowl to hold my cut up green peppers and onions.  I went down to the basement and picked out an onion and headed back upstairs.  Then I grabbed the peppers from the fridge and set it all down next to the bowl. 

I walked over to grab a knife and BAM the glass bowl shattered right on the counter top.  I should have taken a picture as proof but I was too stunned and went immediately into cleanup mode as the kids, in their bare feet, were rushing over to see what happened.

As we were cleaning up I was looking around at the walls and windows thinking to myself that we were just shot at and I need to find the entry point.  Seems kind of silly but I had no other explanation. Alas my 4 pounds of chicken had glass in it and I had to pitch it all.  Luckily my wife's homemade banana bread was still in the oven.  I thought that the bread and rice in the cooker might end up being our dinner.

It was close to 7 PM by the time cleanup was done and the kids had school the next day. We haven't eaten out since vacation several weeks ago.  I broke down and we ended up getting Chinese take-out.  The kids loved it (hopefully not better than my cooking). 

In the end I think God was telling me to not put my family's health at risk to save some money.  Once I got a fortune cookie that said "next time order the shrimp".  We still have it pinned to our cork board as it was pretty funny.  Now I need to make one that says "next time freeze your chicken."

What do you think caused the bowl to break?  Keep in mind the bowl and granite countertop were both at room temperature.

Safe eating,

Dividend Family Guy

Tuesday, September 6, 2016

August 2016 Dividends

The snowball is rolling once again.  After a few months of little dividends I (not really but companies I own part of) pulled in a decent month of $268.33.  Most of it coming from my redesigned dividend portfolio from a few months back.  With four months left in 2016 we will see if I am able to come out ahead of last year.  This year is about $700 behind were I was last year.  I have been holding on to my cash so far this year as I might be making a real estate purchase.  If that doesn't happen I will at least get it invested in my wife's and my IRA's.  Whatever cash is left over will go into the old taxable account.

If my AGI is too high this year I may not be able to take any deductions from IRA contributions.  If that is the case I would almost be better off putting it into my ROTH IRA.  We will see closer to tax time.  What are your thoughts on it?  If I go above $118k in AGI where is the best tax advantage?

Company
Held In
 Dividend (Qtr)
Amount Received
Shares of Life Purchased
August Notes
Verizon (VZ)
Taxable
$0.578
$1.13
0.0207
2.21% dividend increase
Procter & Gamble Co. (PG)
Taxable
$0.670
$0.67
0.0077

Alliance Holdings GP LP (AHGP)
Taxable
$0.550
$0.55


Caterpillar Inc (CAT)
Taxable
$0.770
$0.77
0.0091

Helmerich and Payne Inc (HP)
Taxable
$0.700
$0.70


Intel Corp (INTC)
Taxable
$0.260
$0.78
0.0215

Murphy Oil Corp (MUR)
Taxable
$0.250
$0.50

Cut dividend/time to sell
AT&T Inc. (T)
IRA
$0.480
$48.00
1.1095

Verizon (VZ)
IRA
$0.578
$56.50
1.0368

UNIVERSAL CORP VA (UVV)
IRA
$0.530
$26.50
0.4393

ABBVIE INC SHS (ABBV)
IRA
$0.570
$28.50
0.4251

Procter & Gamble Co. (PG)
IRA
$0.670
$33.48
0.3849

BOWL AMERICA INC    CL A (BWLA)
IRA
$0.170
$51.00
3.5466

Caterpillar Inc (CAT)
IRA
$0.770
$19.25
0.2286


The new account was set to reinvest dividends automatically.  I forgot that I have 30 free trades a month so I set it to accept cash instead.  However that didn't get through their system in time so I have all of these reinvestments this month.  I might as well use those trades even if it is only on a couple of shares (in the right companies).

For the month there wasn't much news.  Verizon (VZ) bumped the dividend while I was on vacation.  Murphy Oil (MUR) cut theirs.  Unfortunately that means time to sell.  As a dividend growth investor you want to own companies that increase their dividend every year.  Stagnant or decreasing dividends won't keep up with inflation or support you well into retirement.  You want companies with increasing earnings each year (and thus increasing dividends.)  The energy sector has been hit hard this year so it was no surprise. Only those companies with tons of cash will be able to survive this energy storm.


YOY (year over year) dividends received was a 53% increase which is always good to see.  I would like to say that was from capital injection.  Maybe some of it was but most comes from the new portfolio. 

I hope you had a good month and the dividends rolled in for you.

Thanks for reading!

Dividend Family Guy