I always love reading blogs about other investors’ investment income. Watching other people’s passive income rise is my second favorite thing (the only thing better is watching our passive income rise!)
This report includes income from dividends, bonds, mutual funds, and rental properties.
Here is the breakdown for August:
| Month | Dividends | Rentals | Total Monthly Passive Income | Trailing average - monthly | Trailing average - 12 months |
|---|---|---|---|---|---|
| September 2016 | $ 6,066.43 | $ 1,717.87 | $ 7,784.30 | ||
| October 2017 | $ 1,157.01 | $ (474.39) | $ 682.62 | $ 4,233.46 | $ 50,801.52 |
| November 2017 | $ 1,002.07 | $ 445.78 | $ 1,447.85 | $ 3,304.92 | $ 39,659.06 |
| December 2017 | $ 10,941.76 | $ 1,704.30 | $ 12,646.06 | $ 5,640.21 | $ 67,682.46 |
| January 2017 | $ 1,204.99 | $ 1,467.99 | $ 2,672.98 | $ 5,046.76 | $ 60,561.12 |
| February 2017 | $ 1,419.12 | $ 1,829.24 | $ 3,248.36 | $ 4,747.03 | $ 56,964.32 |
| March 2017 | $ 7,554.65 | $ 1,602.22 | $ 9,156.87 | $ 5,377.00 | $ 64,524.05 |
| April 2017 | $ 1,247.89 | $ 1,717.87 | $ 2,965.76 | $ 5,075.60 | $ 60,907.19 |
| May 2017 | $ 1,453.98 | $ 962.07 | $ 2,416.05 | $ 4,780.09 | $ 57,361.12 |
| June 2017 | $ 9,168.72 | $ 1,455.71 | $ 10,624.43 | $ 5,364.53 | $ 64,374.32 |
| July 2017 | $ 1,579.14 | $ (1,788.73) | $ (209.59) | $ 4,857.79 | $ 58,293.47 |
| August 2017 | $ 1,581.79 | $ 36.90 | $ 1,618.69 | $ 4,435.51 | $ 55,054.37 |
This makes two poor months in a row for our passive income. Our dividend income was unexciting and the rental properties essentially broke even for the month.
Dividend & Interest Income
The dividend income in the second month of a quarter is always highly concentrated, with $911.83 of the total $1,581.79 (57.6%) coming from a single stock. This is in part because OHI is one of our largest holdings, and it’s in part because OHI pays a dividend that’s currently around 8%.
OHI is 8.22% of our yearly dividend income, so it’s high but not excessively so. This brings up an interesting question – should I be more concerned about diversification of our assets or of our income? That is, OHI is about 1.5% of our portfolio but it’s about 8% of our portfolio income. This disparity is in part in part because we have a large cash position (about 30% of our total) and right now cash pays approximately zero income.
I’m not going to worry too much about this for now. We aren’t fully invested because valuations are excessively high. Once valuations are more reasonable we’ll start deploying our cash. At that time I’ll keep an eye towards income concentration and avoid buying more OHI unless it’s just ridiculously cheap.
Total dividends received were $1,581.79.
Rental income
This category includes net income from the 4 rental properties that my wife and I own, plus 50% of the income from 4 rental properties that we own with my mom. This number does not include appreciation of the properties or the decrease in the mortgage balance (those numbers show up in the net worth report).
This makes two bad months in a row for our properties. Last month we were significantly negative due to multiple repair bills. This month we just about broke even, due to some repairs plus some improvements to one of our properties.
Total rental income was a mere $36.90.
Total passive income this month
Total (dividend + rental) income = $1,618.69
After last month’s net negative month it’s good to be back in the black, but
Here’s what our monthly numbers have looked like since I started publishing them on my website:
At the end of each quarter I’ll also show a graph of our quarterly investment income since I started tracking it on TheMoneyCommando.com. The quarterly graph smooths out the monthly variations. I would expect to see the quarterly number climb every quarter – we’ll know for sure when I update the graph in the September investment income report.
Trailing 12-month passive income
Last 12 months passive income = $55,054.37
This is not a prediction for the next 12 months – it is the actual passive income received in the last 12 months. I would expect the next 12 months of income to be higher as dividends are increased, rent goes up, and new money is put to work.
Recap
We are 45.9% of our way to the goal of $120,000/year in passive income. We have approximately $1M in cash ready to be deployed. If we were to put that to work at a 3% return then we’d expect to receive at least $85,054.37 in passive income next year, which would be 75.9% of the way to our goal.
How did everybody else do with their passive income this month?
What are your thoughts on having a large part of your income from a single source? Is it more important to diversify the sources of your income or your net worth?
Are there any investments out there trading at reasonable valuations that I should be looking at?
I long to see a time that my passive income per month should be able to take care of my total expenses for the month. I am actually working towards that. I usually read income reports like this to gear me up. Thanks for sharing this with us.
What are your monthly expenses and how close are you to covering them with your passive income?