Another raise. The dividend for JNJ is now $1.30. I didn’t understand before. The raises are the real magic.
I also added two new sources of income to my arsenal. Interest from a CD and an ESPP. Most people have at least a cursory awareness of what a CD is. For those that don’t: a CD is like a savings account that you can’t touch for a certain amount of time in exchange for a guaranteed interest payout. Almost everyone in the U.S. has access to these types of investments. I used the windfall I got from a side job during November of last year to invest in a CD because I wasn’t sure what to do. I’m going to start including this type of income as well when I have the ability to invest it.
The ESPP or Employee Stock Purchase Plan is not something everyone has access to. I tell my company to save a portion of my paycheck which is then used at the end of the quarter as a lump sum to purchase stock in my company. I receive a 15% discount on that stock. Though this is not available to everyone, I consider this extra income outside of my normal paycheck and I encourage everyone to think of and utilize opportunities like these – I know there are some brokerages, for instance, with Roth IRA accounts that will match a certain percentage that you invest. In any case, I’ve included the ESPP in my income last week.
I opened a position in ABBV today to increase my allocation in the healthcare sector and added to my position in OXY (energy) as well as SCHD. These are not stocks that pay monthly, but I am still working – probably too much – to balance out the payments so that I receive a roughly equal amount each month. Of the investments that pay quarterly, I’m receiving around $7.20 a month now. Investments with monthly payouts like JEPI, O, SPHD, DIVO, and BND are still the tent poles of my portfolio for now, but all of these dividends are not necessarily qualified (i.e. more taxes) and while diversification is okay, the expense ratios are somewhat high for JEPI, SPHD, and DIVO.
It’s a big balancing act and a lot of work to pick individual companies, but I think in the long run the payoff may be worth it. So I intend to continue adding to my positions in individual companies to balance the sectors, decrease taxes, and even out the quarterly payouts so that they’re roughly equal on a month-to-month basis.