Passive Income – March 2013 Update

04-05-13 Passive Income Update - Evergreen Growth

With March come and gone, it is time for my monthly passive income update. One of my primary reasons for starting this blog was to have a quasi-permanent record of my pursuit of creating passive income with my investments. March was a really good month on a whole, and I expect this passive income growth to continue throughout the year.

Passive Income Summary:

 
March
Income
Year-to-Date
Income
2013 Goal
Percentage of
Annual Goal
LC - Net Interest
$102.93
$205.19
$1,120
18.32%
Dividends
$62.60
$135.37
$700
19.34%
Options Trading
$47.71
$100.70
$300
33.57%
Total
$213.24
$441.26
$2,120
20.81%

Lending Club: March saw my net interest from Lending Club jump significantly as I doubled my year-to-date net interest income. With more and more of my IRA invested, my monthly repayments are expanding rapidly, with a current total of about $300 between both accounts. With this quickly increasing amount, it is easy to observe the effects of compounding as I reinvest the repayments into new notes. Currently, my average interest rates are 18.22% and 14.98% in my Roth IRA and taxable accounts, respectively. For March, my overall internal rate of return was 11.39% across both accounts.

I hope to receive between $140-150 in net interest per month by the end of the year; however, I anticipate accomplishing that as early as June or July. I calculate my interest amount to be interest received less any charge-offs, defaults, and services fees in the given period. If you haven’t yet, check out my full March Lending Club update.

Dividends/Trading Income: During March I received dividend payments from two of my holdings. Intel (INTC) paid their quarterly dividend of $0.225 per share, resulting in $29.25 of dividends. Unfortunately, after my switch to TradeKing with this particular account, I wasn’t able to get these dividends reinvested directly. I also received my monthly dividend payment from Prospect Capital (PSEC) of $0.11 per share, resulting in a reinvested $33.35 of dividends. This was reinvested into 2.978 more shares bringing my total up to 305.978 shares.

Just last week it was announced that Cisco Systems (CSCO) would be increasing their dividend from $0.14 to $0.17 per share. This is an increase of 21.4%, and comes in time for their April dividend. As I mentioned when I originally sold a put on CSCO, which resulting in the acquisition of my 100 shares, they have plenty of room to grow dividends payments. As the second CSCO dividend increase in less than a year, this has resulted in a one year increase of 112.50%. This most recent increase provides me a 3.29% yield-on-cost.

With the reinvestment of my PSEC dividends and the increase in CSCO’s dividend payments, my projected 12-month forward dividends have increased by $15.93. Unfortunately, I had a calculation error of $2.60 on my INTC projected dividends, thus netting an actual increase of $13.33 over the prior month giving me a new projected 12-month forward total of $942.41.

I was very fortunate to be able to close a put I sold on INTC in just 11 days at the beginning of March. This quick turnaround net me $47.71 in option profit, 72% annualized return on the money tied up by option. This additional profit brings my annual total up to $100.70 of option income. Because of the demands on my capital in other area’s, I will not be doing a lot of options trading between now and the end of the year. I would fully anticipate not hitting my goal.

Quarterly Summary: Overall I had an awesome first quarter of 2013 for passive income with a total of $441.26. I can’t wait to check back in the quarters and years to come to see the progress I will have made from this first quarter.

That’s it for my March passive income update! Don’t hesitate to look around; you can find details on all of my equity investments under the Investments page, peer-to-peer lending on the Lending Club page, monthly updates under the Passive Income Updates page, and progress on my 2013 goals on the Goals page.

If you haven’t yet, be sure to follow me on Twitter, and like me on Facebook!

Flickr: mikeyskatie

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Comments

  1. Great job in March! I’d really like to diversify into LC, but Texas hasn’t approved it yet as far I know.

    Keep up the good work!

  2. w2r,

    Great job! You had an excellent month and I’m sure your progress will continue to snowball as you reinvest all this passive income. Good stuff!

    Keep up the great work. I see you were assigned 100 shares of CSCO. That’s one I’m watching. Potential growth ahead as the internet becomes a greater part of our everyday lives and spreads across the world.

    Best wishes!

    • Thanks DM! I, too, am very much looking to see how my investments snowball over the coming years. With CSCO there is huge potential growth with the continued rise of the digital age, as well as the significant cash reserves they have hoarded.

  3. I like your results and plans. I am happy that the dividend investing and LC works for you. It does work great for me too.

  4. Nice job on the dividends! We’re hoping to average $100 a month on dividends by the end of 2013.

  5. Nice work, I love the numbers!

  6. I couldn’t resist Cisco either. I snapped some up toward the end of last month

    • I think CSCO is really a great buy; great payout ratio with plenty of cash on the books. Not to mention I think they have the ability and resources to transition nicely as the world’s technologies continue to evolve.

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