Friday, March 20, 2009

'special' income from investments

To quote the eloquent US president Barack Obama, my income from investments has been 'like Special Olympics or something' lately.

Husky Energy (HSE), Bank of America (BAC), and General Electric (GE) have all cut their dividends over the past few months sending my portfolio income spiralling. Yes, the third earner in our family has taken a 6% pay cut. He is however, still pulling in 99.5% more money than he was at this time last year. Our current dividend income sits at $3,271.29, or $8.96 per day. This is down 6% from a high of $3,479 in December of 2008.

If we were living off this income I might consider switching from Australian to Chilean red wine, but since this income is supplementary and gets reinvested anyway I am not concerned and am sticking to my knitting. The financial crisis will have many casualties, including my income from investments. I am not surprised to see it decrease in the short term. I still do expect the generous yearly raises to continue in the mid and long term. The rewards for putting our money at risk are potentially much greater now that the market has suffered as it has. Well-managed companies with strong brands will continue to grow and raise their pay outs to investors in the years ahead.


Anonymous said...

I don't know why you're always complaining about the state of the way companies are. I want to quote something you wrote earlier last year about enjoying when company stock prices go down because it means you can buy more.

Unfortnately when there is no more money to buy more stock and they keep decreasing it's not surprising that you now feel bad!!!!!!

Anonymous said...

Like you we invest for dividend income. Our dividend income is now $334.00 per day and I am still buying a few dividend stocks here and there. We have had many of our income trust dividends reduced as well as BAC, PFE, but we have sold very little and I feel there are opportunities available to the strong minded investor right now.

MG (moneygardener) said...

Anon1, I am not always complaining about 'the state of the way companies are'. While it has been a little extreme, theoretically I do enjoy when stock prices go down. I'd rather them fall now than at a time closer to when I need the funds.

Andrew said...

$334 per day! Is that a typo or the straight goods?