This is the third and hopefully final incarnation of my retirement income project. In 2022 I started recycling lower yield shares into higher yield income oriented ITs, some of which are AIC "dividend heroes".
I have realigned with the Tax Year (5 April) to make future income planning easier, and reset accumulation, income units and XIRR. Other than actual income which includes "legacy" shares, all figures here apply to just the portfolio listed below.
2024 Result / 2025 Target
The recalibrated target for the next decade. Overall income is indexed here, an increase of +5.9% pa through the combined effect of dividend increases, cuts, reinvestment and capital contributions. I am aiming to start drawdown from 2030/31.
Year | Target Income | Actual Income | Increase % | Acc Unit (p) | Inc Unit (p) | Inc/Inc Unit (p)
| (Indexed) | (Indexed) | | | |
2022/23 | 10000 | 11617 | | | |
2023/24 | 10592 | 10787 | -7.1%(*) | 101.3 | 100.0 | 7.3
2024/25 | 11219 | | | | |
2030/31 | 15845 | | | | |
(*) Income Culprits (index points) - legacy shares still to be recycled.
RE.B | -701 | Deferred (paying 15 April)
RIO | -385 | Reduced
DLG | -381 | Cancelled (resuming 17 May)
RAVP | -103 | Delisted
Trading & Costs
Custody, dealing and stamp duty charges, as a percentage of income.
Year | Buys | Sells | Costs/Income % | Turnover %
| | | |
2023/24 | 23 | 1 | 1.17% | -
2024/25 | | | |
Portfolio (5 April)
16 holdings / 11 sectors and 1 month of target income in cash.
("legacy" shares excluded, "dividend heroes" bolded)
EPIC | Sector | Weight % | Income % | Yield %
| | | |
RE.B | Farmland & Forestry(*) | 3.4 | 5.3 | 11.4
HFEL | Asia Pacific Equity Income | 4.4 | 6.6 | 11.0
FSFL | Renewable Energy Infrastructure | 5.2 | 6.8 | 9.7
SMIF | Debt - Loans & Bonds | 5.4 | 6.6 | 9.0
NCYF | Debt - Loans & Bonds | 5.4 | 6.4 | 8.7
JLEN | Renewable Energy Infrastructure | 5.9 | 6.8 | 8.6
AEI | UK Equity Income | 6.1 | 6.8 | 8.2
APAX | Private Equity | 6.2 | 6.6 | 7.8
THRL | Property - UK Healthcare | 6.2 | 6.1 | 7.2
EAT | European Smaller Companies | 7.1 | 6.6 | 6.9
CHI | UK Equity Income | 7.1 | 6.6 | 6.9
HHI | UK Equity & Bond Income | 7.1 | 6.5 | 6.8
INPP | Infrastructure | 6.5 | 5.8 | 6.5
CTPE | Private Equity | 8.2 | 6.8 | 6.1
MYI | Global Equity Income | 7.9 | 5.0 | 4.6
SOI | Asia Pacific Equity Income | 7.8 | 4.8 | 4.6
| | 100.0 | 100.0 | 7.4
(*) I am keeping hold of RE.B which isn't an IT, for convenience using the closest matching AIC classification here.
Sector Type Snapshot.
Sector Type | Weight % | Income %
| |
Specialist | 35.4 | 37.9
Overseas | 27.1 | 23.0
UK | 20.4 | 20.0
Debt | 10.8 | 13.0
Property | 6.2 | 6.1
| 100.0 | 100.0
Outlook
While forecast income exceeds target it will be reinvested into lower yield growth oriented ITs. From the AIC "dividend heroes", FCIT joins the portfolio next week and will be bought in tranches up to median weight.
Year | Target Income | F'cast Income
| (Indexed) | (Indexed)
2024/25 | 11219 | 11742
2025/26 | 11884 |
All that remains to write as usual is:
Happy New (Tax) Year 2024 to All, and Thankyou to Owners and Mods for keeping LF running.
M