First quarter down for this year and what a ride it was!
I did my first goal review post back in February about my progress in January. I was considering at the time to do it on a monthly basis, but I felt that there was not that much to report on about February. There’s no sense in bothering you with empty content just for the sake of pushing out posts. Hence a Quarterly cadense sounds much better to me and hopefully it is also more interesting to you.
So, let’s have a look at my performance for the first quarter which definitely ended with a wild rollercoaster in March 🎢. As a reminder, my 2020 goals are categorized as per below and in order of priority:
- Wealth (FIRE)
- Giving back
I will now give a brief update for each of the 4 categories.
- Finish the Cooper Test with at least 2700 meters (classification Very Good)
In February I reported that I had the first goal in the pocket for this category. I almost hit my second goal as well, but I am lacking just 70 meters to complete the 2700 meter coopertest goal.
How did I do on the other goals in this category? I will only highlight the ones that I made some progress on.
- Run 500 km in total
50 Kilometers so far. This should have been much more by now, but the recent COVID-19 lockdown has really limited my sporting exercises. The group that I’m typically sporting with has cancelled all events until further notice, so a lot depends on myself now. This is where I’ve been lacking motivation, which I need to pick up again. Hopefully the Easter break will give me a little boost again!
With this progress it’s not likely that I will achieve this goal. I will really need to step up here and find the personal motivation to sport alone.
- Reach an average of 10.000 steps a day
6800 steps daily so far. This one has become very disappointing. Sitting behind your desk while working from home is just killing for the step count. It’s also not easy to increase it, because we’re not allowed to just wander around now. We will see how it goes, but I don’t worry too much about this one due to the given situation.
Goals that I still need to start doing, but that will rather start happening during spring:
- Get a long desired surgery done to fix a part of my vision
- Run 10k under 50 minutes in an official race
- Bike 500 km in total
All in all, I do feel pretty well from a health perspective. Gardening allows me to be outside in the sun and it gives me a lot of fresh oxigen, so given the circumstances, it’s not that bad.
- Two weekends away with the missus and without the kids
Nothing happened here due to the lockdown.
- Support kids in their activities and be visible and available
If there’s one goal that rocked during the last two months then it’s this one. I have been spending an incredible amount with my kids over the last month. We’ve done a lot of indoor activities and we have spent a lot of quality time together. As an example, we’ve cleaned my son’s entire room, drawer by drawer, box by box. This was a few day activity, but it felt like a walk through memory lane.
- Listen to understand, not to be understood
I finally started to make progress on this one and I think I have been much more thoughtful and listening to the people around me. I can see that it works and that it empowers others much more. This is off course a very intangable goal and hard to measure, but let’s say that the overall mood in the house increases when we all do this 😎
Goals that I still need to start doing, but given the situation might actually not happen at all:
- Have a long distance holiday, thus another continent than Europe
- Invest 40% of my salary in my dividend growth portfolio
I have saved 55% of my salary in Q1 and all has been invested into of my portfolio. Actually, my March savings where almost 70% and that’s my best savings rate ever. This is off course due to the lock down. I currently don’t spend money on dining out, fuel, public transport and luxury shopping (i.e.clothes). Hence, I treat this as temporarily, but it shows why the economic crisis will be so hard for people working in some of those sectors. My thoughts are with you guys!
On top of that, I also started to allocate fundings from my War Chest into the stock market. My war chest reduced in Q1 with a total of 15% and I aim for it to be reduced by 5% going forward on a monthly basis. At least as long as the economic crisis provides these kinds of buying opportunities.
In Q1 I initiated new positions in Novartis and Danone and I increased my positions in 3M, ExxonMobil, Royal Dutch Shell, Siemens, Johnson & Johnson, but most and for all in Unilever. Initially in January and February I spent most of my investments in Oil and the cyclicals, but since March I have shifted my focus to ensure that I am using this bear market opportunity to strengthen my core foundation of the portfolio.
- Reinvest all my received dividends
I reinvested all the incoming cash flow from dividends back into the stock market. Royal Dutch Shell was a special one in March, because I received twice as many shares compared to normally due to the extraordinary price decline. This is Drip and Compounding in its ultimate form!
While January was a poor month in dividend cash flow for me, February and March more than recovered it for me. I am currently on 20.2% of total expected dividend payments.
I am really proud on that and I know that the recent investments will also start paying their dividends in the upcoming quarter. This means that I expect some form of exponential growth in my dividend cash flow in the remainder of the year. I just love this kind of investing for cash flow!
- Grow my dividend income so that it covers at least 25% of our monthly expenses
I have made some really good progress here. You just got to love March and the buying opportunities that it created. I have used the opportunity and invested an increased amount of money from the war chest into my portfolio. This resulted in a 22.5% expense coverage ratio and I am really nice on track now to achieve this goal around the summer.
Dividend hikes also nicely contributed to this goal. The following companies hiked their dividends during Q1:
- Chevron: 1.19 to 1.29 quarterly: 8.4%
- BHP Group Plc: 1.10 to 1.30 interim dividend: 18.2%
- Munich Re: 9.25 to 9.80 annually: 5.9%
- Ahold-Delhaize: 0.70 to 0.76 annually: 8.6%
- Kimberly Clark: 1.03 to 1.07 quarterly: 3.9%
- Siemens: 3.80 to 3.90 annually: 2.6%
- 3M: 1.44 to 1.47 quarterly: 2.1%
These were quite some nice increases and this is what I truly mean with compounding into freedom 🌴
The following goal I still need to start doing, but I didn’t do so yet due to the opportunities that the bear market provided:
- Use any leftover income to pay down the principal of our mortgage on a quarterly basis. Preferably paying down enough to reduce the mortgage by 1 year.
4. Giving back
- Share my journey and knowledge via this blog to inspire others
I think that this goal is pretty on track. So far I have written 32 articles. Some are better than others, but I leave the judgement about the quality up to you 😎
- Inspire one person in my environment to also start investing for the future and coach that person
The market turmoil has woken up several people in my environment that suddenly wanted to start investing. I guess they had some cash on hand and saw the news of declining stock markets as a buying opportunity.
Having said that, I am coaching the first person already and this person already started investing. I had to really coach this person to think long-term instead of the thrillseeking short-term, but it worked out. Therefore I believe that this goal is in the pocket already 💪
A goal that I still need to start doing under this category:
- Contribute two days of my time to a local charity
I am very grateful for the time that I’ve been able to spend with my family during this lockdown. I am sure that we will keep fond memories about this period for many years to come. Luckily nobody in my surroundings has been infected by the virus yet and I feel very grateful for that.
I have tremendous respect for all the frontline workers and biotech lab-workers that are currently fighting to get this pandemic fixed for us. You all are true heroes!
I am also very satisfied with the level of energy that I was able to put in and the return on satisfaction that it gave me. I have never written so much with content that was publicly available. This is new to me, but I must confess: I love it!
Q1 was also a quarter full with fireworks and these are definitely the moments that I love most about investing. It’s not about the adreline pumping through the body, but it’s rather about the awareness that these are the moments where we can create extraordinary wealth for the decades to come.
Having said that, Q1 was good, let’s try to make Q2 even better 👌
I hope that you enjoyed my update and if you did like reading it then please hit the like button or leave a comment. I would be very grateful 🙏.
— European Dividend Growth Investor