Dividend Account results – 2020

For most folks who are tracking dividends, 2020 has been a crazy year (unlike the rest of the folks?). Yields went up dramatically in the first half – because stock prices crashed. Yields returned to their normal levels, or were lower, because stocks hit the roof! Yield percentage ended up not being the best way to track performance because of the wild swings in stock value – the key was to track the actual dividends paid.

My brokerage account is invested in a Vanguard value fund 100%, so dividends aren’t that much of an emphasis. Still the yield on that was 1.92%, which beat the S&P500 (my Vanguard S&P 500 was yielding around 1.5%). The dividends paid out were slightly higher than last year.

My stretch IRA, which was built to generate dividends, really showed the effects of 2020. The value of the account dropped 12% for the year (I had a lot of REITs), but the dividend was up 5.7% for the year. While their value dropped, they did pay me more income.

Vanguard Stretch IRA
stockDetailsInvestment valueYieldDividend
CATCaterpillar$9,101.001.70%$154.50
CVXChevron$4,222.506.11%$258.00
CSCOCisco Systems$6,712.503.20%$214.50
DOWDow$5,550.005.05%$280.00
XOMExxon Mobil$4,122.008.44%$348.00
HRHealthcare Realty$14,800.004.05%$600.00
IBMInternational Business Machines$6,294.005.17%$325.50
PFFiShares$12,708.304.79%$609.09
PFEPfizer$5,521.504.13%$228.00
ORealty Income Corp (REIT)$12,434.004.31%$536.05
SVCServices PPTYS TR$6,894.002.61%$180.00
MMM3M Company$8,739.502.35%$205.80
UMHUMH Properties$16,291.004.86%$792.00
VZVerizon$5,875.004.21%$247.25
WBAWalgreens$3,988.004.64%$185.00
$123,253.304.19%$5,163.69

This was offset by the performance of my 401K, IRAs and Roths. I’ve talked before about my mix, and I dropped my bond allocation for 2020 from 30% to 20%. This appears to have hit my dividends, because they are down 8.2% for the year (about $2k). Yet the gains in the funds for the year are up 8.3% (over $100K) – so I think I made the right choice reducing my bond allocation.

Overall, I received about $957 less in dividends in 2020 vs. 2019. Again, I think the change in bond allocation affected this – which probably means my dividends will drop further in 2021 since I’m getting out of bonds. We will see.

  Variance in Value 2020 vs 2019Variance in Dividend
Vanguard Brokerage $57,743$1,079
Vanguard Stretch IRA ($16,107)$279
401K $10,673$207
Deferred Investments $6,940($214)
TRowePrice IRA $16,059($935)
TRowePrice Roth IRA $28,586($440)
Vanguard IRA $33,773($1,307)
Vanguard Roth IRA $34,004$735
 $171,671($597)

As I have stated previously, I use this account to experiment and look to see how I might use a lump of cash to generate income. In the book “Power of Zero” they point out that if you keep your income below a certain threshold, dividends and capital gains are tax free. That is going to be one of my goals for my retirement, to keep my taxes very low.

How did everyone else do with the dividends in 2020?

Mr. 39 Months

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