September 2020 Passive Income $1,583

Welcome to my September 2020 Passive Income report.  This is where I track my investment income from dividend stocks, index funds and exchange-traded funds (ETFs).

September has been a horrible month for just about every asset class, but it’s been a decent month for passive income. There lots of uncertainty right now and the markets are throwing a tantrum. If we get another meltdown like we saw in March, I’ll definitely be deploying more cash.

My goal is to one day be able to live off this passive income or at least have a significant portion of my living expenses covered by it.

Why Do I Publish My Passive Income?

First off, I’d like to say that I’m not trying to brag about my passive income in any way by publishing these reports. Trust me, there are some financial bloggers out there that do a lot better than I do and are absolutely killing it. I’m not some financial guru either. I’m just a regular guy with a day job that’s trying to get ahead and escape the daily grind like everyone else.

My main reason for producing these reports is to motivate myself and hopefully others to do better financially. Over the years, I’ve found that when I track my dividend income, it tends to grow.  

Maybe its because I’m focused on growing those dividends that I’m constantly scheming up ways to make more money (or save more money), so that it can be put to good use by investing it in great dividend paying companies.  This approach has served me well and this year my family is on track to earning $21k in passive dividend income.

Think about it.  That’s $21k that we don’t have to get up in the morning to work for.  We just go on living our lives and all the while, each and every month, we receive cold hard cash in the form of dividends from our investments.  

Right now we re-invest these dividends to buy more shares in our favorite companies so that the dividend income continues to grow over time.  But one day, we will be using that dividend income to finance an early retirement.

Net Worth Recovered

After dropping by about $90k in March, our net worth has fully recovered due to the stock market recovery. We are now at $1.346 Million! Our net worth goal for this year is 1.5 million so we have a long ways to go yet! But the market is doing a lot better right now.

I’m still buying a bit and when the market fully makes a comeback, my net worth will surge ahead like it did after all the other crashes.

Financial Assets Holding On

The recent stock market correction has hit the value of our financial assets. That said, we keep investing and our financial assets are at $771k!

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Building Up Real Assets

I’ve also been adding to my Gold and Silver holdings to hedge some of the risks to financial markets.

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Killing Debt + Building Assets = Wealth

While it’s always nice to see our investments grow, I’m also happy to see some real progress by paying off our line of credit debt. We finally got the mortgage paid to down to below $265k this month!

The more I think about being completely debt free, the more I look forward to what life will be like when I don’t need to worry about debt. In the meantime, once the mortgage goes below $200k I’ll feel a lot better.

Paying down our debt is key to building our net worth and strengthening our financial position.

Net Worth vs Investment Income

Having a million dollar plus net worth is an important milestone on the road to financial freedom.  But unless it’s backed up with some serious cash flow, it doesn’t really mean all that much.  

After all, as you can see from these reports, my net worth rises and falls primarily due to fluctuations in the stock and real estate markets.  For me, what’s really important is that my investments keep paying me cold hard cash each and every month.  

That’s where my sense of financial security comes from, not whether I can sell something for more than I paid for it last week, or a month ago.

Streams of Passive Income are Key to Financial Independence

The one major thing I learned during the last recession was that, while my net worth may fall, the bulk of my dividend income remains the same.  That’s why I think building streams of alternative forms of income, whether it’s from a rental property, dividend stocks or even an online source like starting a blog, is key to achieving financial freedom.  

Once you start hitting $1k/month, you basically have about half of your monthly expenses paid for by passive investment income.  What’s even better is that I’ve found that after a few years, the income really starts to take off.

Benefits of Passive Income

I once read somewhere that millionaires have about 7 different sources of income, which is a big reason why they’re rich.  If they lose 1 source it’s not the end of the world for them because the other 6 still provide financial security.  On the other hand, the rest of us are almost completely dependent on 1 source: our Jobs!

This is something that I’m working hard to change for my family and is why I invest as much as I can.  In these income reports  I try to be as transparent as possible to show you where my investment income comes from.  

These reports simply show my investing approach and what has worked (and sometimes not worked) for me.  I’m by no means a financial expert but I am very pleased with my results to date.

I hope these reports inspire all of you to start saving and investing your money for a healthier financial future.  Now you may think that you need a lot of money to start investing, but the reality is that you can get started with as little as $25 a month!  So what are you waiting for?

How You Can Build Passive Sources of Income

Some of you may be wondering how YOU can start investing and building up streams of passive income.  First, just let me say that investing is NOT rocket science, but I DO recommend reading as much as you possibly can.  Check out my MUST READ page for some useful articles.  You can also see my Favorite Personal Finance Books List.

If you’re hell bent and determined to start investing your money in dividend stocks and exchange-traded funds (ETFs) right now, check out my step by step guide on How to Open a Questrade Account.  

If you’re a bit hesitant to start buying stocks or ETFs through an online discount broker like Questrade, then you may want to try an online bank like Tangerine.  They offer a range of accounts (RRSP, TFSA) and a whole menu of Tangerine Investment Funds at reasonable prices.

Now on to my monthly cash flow from investments.

Monthly Investing Activity

Right now I’ve been buying some energy stocks and waiting for other bargains to appear. I have a little cash on the sidelines in my investing accounts that I intend to use on any big pullback.

Saving and investing automatically is a proven strategy for building long term wealth so I keep making extra cash purchases in my DRiP account to buy more shares of great dividend-paying companies. In addition to the stock purchases, I’m also investing in low-cost index funds in our retirement accounts.  These purchases amounted to about $1.6k in total.

As I said before, one of the great things about being a dividend investor is that all of my dividend income is automatically re-invested.  Every month this income buys more shares in my favorite companies that will, in turn, produce even more monthly income for me.  This is how compounding works and is why it’s such a powerful force…what Einstein called the “Eighth Wonder of the World”!

This month, reinvested dividend income bought more shares in Fortis (FTS), Manulife (MFC), Suncor (SU), Enbridge (ENB), Canadian Utilities (CU) and lots more shares of our index funds.

I’ve also sent money to my DRIP accounts to buy my favorite Canadian dividend stocks: Telus (T), Fortis (FTS), Bank of Nova Scotia (BNS), Bank of Montreal (BMO), Suncor (SU) and Bell Canada (BCE).

Dividend Raises

none.

September 2020 Passive Income Report

Monthly Passive Dividend Income

September was a great month for dividend income coming in at $919.83! This month’s dividend income has decreased by -8.52% from September 2019 ($1,005.58). The reason for the drop is that I sold Enbridge (ENB) and Fortis (FTS).

Here is the breakdown of the numbers for my September 2020 Passive Income:

Dividend Stocks

Bank of America (BAC) – $5.96

Canadian Utilities (CU) – $97.53

Enbridge (ENB) – $0.88

Fortis (FTS) – $5.76

Manulife Financial (MFC) – $89.16

RioCan Real Estate Investment Trust (REI) – $4.70

Suncor Energy (SU) – $140.85

Sun Life Financial (SLF) – $44.53

ETFs and Mutual Funds

iShares S&P TSX Canadian Preferred Share Index ETF (CPD) – $58.60

iShares S&P TSX Capped REIT Index ETF (XRE) – $39.79

TD International Index Fund – e (TDB911) – $432.07

Total Dividend Income: $919.83

It’s great to see that our investments are producing nearly $1 k last month!  That’s not too shabby at all for a completely passive source of income. After years of saving and investing, I’m starting to see the fruits of my effort and I’m happy to finally have my money working for me.

Blog Income: $663.49

I’ve included my blog income as I’ve had a number of readers ask about its profitability.  Blog income is never a sure thing.  In fact, it’s all over the place.  This month’s income was pretty good and is a combination of Adsense and affiliate sales.

Starting a website and earning online income has never been easier and I highly recommend starting your own website. It cost about $200 a year and the sky is the limit as to how much you can possibly earn.

If you’re looking for a side hustle consider earning online income. I’m not gonna lie and say that it’s easy to make tons of cash, but if you spend a little bit of time and write some quality content you should do just fine. Check out my step by step guide below for more info:

How to Start a Blog

While I’m not living off of my blog income, it does help my cash flow for buying dividend stocks. For those of you interested in building solid long term wealth, it’s crucial to find ways to make more money so you can use it to make investments.  

I’ve been investing thousands each month in high quality dividend stocks. Without my blog income I wouldn’t be able to invest as much.  I think you guys get the idea here.  Generate more income to invest and you’ll really kick-start the power of compounded returns.  If you want to achieve financial freedom, you gotta do some side hustling to get there.

My family’s annual passive income goal is $23,000 and we have so far received $15,680 in purely passive dividend income. So far, we’re at 68.18% of our annual goal.

Thanks for reading my September 2020 Passive Income Report and remember that if you Invest Early and Stay With It for the long haul, then you’ll see these kinds of results too!

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