Dividend Income Summary: Bert's November 2020 Summary (2024)

We are rounding third on 2020 and heading home. It is crazy to me that we are in the final month of the year. Where has time gone? With another month in the books, it is time for our favorite activity. Each month, we summarize our dividend income results and see how we have progressed compared to last year. This article will review the dividends we received in November and the impact dividend increases has on our forward dividend income.

Why I Invest in Dividend Stocks

I invest in dividend stocks to grow my passive income and achieve financial independence. Eventually, one day, my dividend income will be large enough to cover my monthly expenses. That is why Lanny and I are relentlessly searching for dividend stocks to buy on a regular basis.

To find dividend stocks to purchase, we use our dividend stock screener. Over the years, our stock screener has helped us find some awesome undervalued dividend stocks. This simple, 3-step stock screener is designed to identify undervalued stocks with a strong payout ratio that have a history of increasing their dividend. I can't think of the last time we purchased a stock without using our stock screener.

Dividend investing in 2020 is as important as ever. Our cash is earning essentially nothing in our savings accounts. Why? Interest rates on our savings accounts continue to remain low. My current "high yield" savings account has an interest rate of .65%. Unfortunately, we are going to be in a low interest rate environment for a long, long time. That is great for individuals looking to borrow debt and awful for people looking to earn a nice return on their savings.

Building a large dividend income stream takes time, consistency, hard work, saving, and most importantly, investing. I have been investing in dividend growth stocks since 2012. Slowly, but steadily, my income has increased over the years. Now, in 2020, I am enjoying some of my strongest dividend income months. Further, with each purchase, dividend increase, and reinvested dividend, we are setting the table for a strong 2021. It is really exciting to see the growth and larger dividend checks trickle into my brokerage account.

Each month, we share our dividend income summaries to highlight our growth and progress. It is a fun and helpful exercise that holds us accountable. Further, it helps you, our followers, see the stocks we are purchasing.

Bert's November Dividend Income Summary

In November, we received $604.78 in dividend income. That is a 19.5% increase compared to last year. Despite the fact our year-over-year growth rate dropped compared to last month, I am very excited to have received over $600 in November. Our detailed breakdown of individual dividend payments received is as follows.

In every monthly dividend income summary article, I provide a few observations and highlights. My notes for the month of November are as follows.

Observation 1: AT&T Steals the Show

This may not shock a lot of people. However, I have added a significant amount to our AT&T (T) positions over the year. Quite frankly, AT&T has been one of my favorite stocks over the years. The company is not only a Dividend Aristocrat (25+ years of consecutive dividend increases), they also have earned the coveted award of being one of our Top 5 Foundation Dividend Stocks.

AT&T's stock price hasn't performed well (until lately). Since the pandemic started, the company has consistently traded below $30 per share. In fact, for a while, the company's stock price was trading between $26 per share and $28 per share. This resulted in an insanely high dividend yield that approached 8%.

During this period, I took advantage of the company's low price and built up the positions in our portfolios. In November, the fruits of our labor showed. My wife and I received a combined $166 in dividend income from the telecom giant. This was an increase of $46 compared to November 2019. Not only was this our highest dividend paying company, it also represented the largest dividend increase from an individual company compared to last year. Talk about a show stopper for November.

Observation 2: Dividends from New Investments Made a Real Impact

AT&T wasn't the only reason our dividend income increased over the last few months. There were 3 new investments that paid us dividends in November 2020 that did not pay us a dividend last year. Two of the new dividends are from Dividend Aristocrats. The companies were People's United Financial (PBCT) and General Dynamics (GD).

People's United is a large community bank that pays a very strong dividend (5.4% today). It is crazy that a bank is a Dividend Aristocrat, in my opinion. That means the company still increased its dividend through the global financial crisis. We always talk about how we like companies that can weather storms and increase their dividend. It tells a lot about this management team's ability to manage the company since they increased their dividend through the banking industry's worst event since the Great Depression.

General Dynamics is a great company, but a frustrating tale for me. Why? I have too small of a position in this company. Whenever I try to increase my position in the company, its stock price jumps up. Thus, I only received a $5.50 dividend from the company in November. This position in my portfolio is nowhere close to being full and I will continue to add once the price is right.

The third company, WestRock (WRK), has been quite the journey for me. I forgot that I purchased shares at the end of 2019. Man, it seems like I have owned them for years. However, the company announced a large dividend cut at the start of the pandemic. Therefore, while it appears that the dividend income increased compared to last year, it actually decreased compared to last quarter.

Observation 3: A Couple of Dividend Decreases

My third observation relates to declines in my dividend income compared to last year. First, as you can see, we did not receive a dividend from Delta Air Lines (DAL). The airline industry has been decimated by the pandemic and is still struggling to recover. Honestly, I am not expecting to receive a dividend from Delta anytime soon, unfortunately. At least we received 1 dividend from them last year.

Second, if you notice, we did not receive a dividend from our brokerage's money market account. Last year, we were holding a lot more cash in our brokerage account. Since our balances were high, we received a nice dividend on the funds. However, we have put out cash to work in 2020. Rather than sit on the sidelines and earn a small amount in our money market account, we have been purchasing dividend growth stocks. I will take this trade off every day and twice on Sunday.

The Impact of Dividend Increases: November 2020

In this section, I will summarize the impact dividend increases had on our dividend portfolio. Dividend increases are such an important component of dividend investing. We want to see our dividend income grow and not remain stagnant and are constantly monitoring our investments for dividend increases. We summarize dividend increases in a monthly article on our series and have even began talking about weekly dividend news on our YouTube channel. Yes, we love dividend increases that much.

I received 4 dividend increases in November. In total, the dividend increases add almost $26 in forward dividend income to our portfolio. The chart below summarizes each dividend increase and the additional forward dividend income each added.

Of the four dividend increases received, one of the dividend increases had a larger impact than others. Clearly, the massive 18% dividend increase from Aflac (AFL) added a lot of dividend income to my portfolio. Like AT&T, I purchased a lot of shares of Aflac this year. The company's stock price also fell after the pandemic. I loved Aflac's metrics and decided to build my position in this Dividend Aristocrat with a strong balance sheet and a great payout ratio. The results paid off, as this dividend increase added over $21 to our dividend income.

The other dividend increases did not move the needle too much. The best of the dividend increases was TJ Maxx (TJX). The company not only reinstated its dividend, it also increased it as well. That was huge news for investors. It is part of the reason we are so adamant that dividends are back. Companies that suspended their dividend are now announcing returning payments to shareholders.

Unfortunately, for me, we only own 2 shares. However, every dollar counts on our journey towards financial freedom. Therefore, I will gladly take the additional $2 in dividend income we will receive from them annually.

Summary: November Dividend Income

We are officially one step closer to financial freedom. It is that plain and simple. Through dividend reinvestment, we have added another $600 in capital to our portfolio. Assuming a 3% dividend yield, our reinvested dividends added $18 in dividend income.

That is why I am so excited with our monthly results. Some major progress was made. We received some very nice dividend increases. Further, we saw dividend payments increase from some of our favorite holdings while establishing positions in new companies. This is fundamental dividend growth investing at its finest. How could you not love dividend investing?

Let's all continue pushing forward and investing every dollar we possibly can into income producing assets. Come on everyone, let's finish the year strong!

Did you receive a record setting amount of dividend income in November? What stock paid you the highest dividend income total? Did you buy AT&T this year and receive a large dividend as a result?

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Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.

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