88V8 wrote:
I recall a thread or three on TMF about the lumpiness of divis. If we depended on our HYP then I'd have to do something about it, as some months are verrrry slow.
Quarter-wise we're roughly 16% / 30% / 23% / 33%.
Quarterly payers are nice.
We have NRR, IMB, BATS, BRCI, RDSB, BP, GSK, BLND, plus RUSC, RUSP, DNA2, which are not discussable hereabouts.
The general idea that's put forward during these types of 'dividend-lumpiness' discussions is to have a separate 'holding account', which all dividends are paid into, and then we allow a capital buffer to build up inside that 'holding account'.
At some point, when the 'holding account' capital buffer is large enough (this can also be used as a safety-net buffer to cater for dividend-cuts etc...), you can then start to pay out a standard monthly payment from that 'holding account' into what might be your main bank-account - in a similar way as we generally see a monthly 'pay packet' amount paid into our accounts whilst we're working.
The idea is that over a 12-month period, the
12xmultiple that you
pay out of the holding account is replenished
inside the holding account by the portfolio dividend payments, with no real concern over when those payments are actually made to the holding account - so long as the expected dividends are received over a 12-month period, and there's a suitable buffer to cater for unexpected events, then everything should work really smoothly and we should simply see our '
dividend wage' appear every month into our main bank accounts....
Doing it this way, we don't worry
at all about 'dividend lumpiness', and we certainly don't then have to start thinking of hunting down particular investments that might pay out dividends in an otherwise 'barren month', or quarterly, or anything like that - doing so would be using such a feature of an investment in absolutely the wrong way, and payout dates should carry almost
zero importance in our investment decisions...there are far more important metrics to consider....
I don't think anyone should place any prominence at all on dividend payment dates - after all, we've no control over them, and companies often change the dates and payout configurations themselves, so why should they seriously matter?
Cheers,
Itsallaguess