Simple Dividend Income Calculator (Early Beat)

[petershk]

Hi all.
Since I'm trial running "early retirement" I got the urge to program something mildly useful and entertaining for myself.

Since I have consistent income on the brain I thought I'd take a stab at seeing what cash flow various investments would yield in different periods of time. (for example, what if I just held a 100% bond fund for 15 years... what would my monthly cash flow look like?).

I'm a "total return" investor, but I also love the feeling of dividends/distributions coming in on a somewhat reliable basis. There's a sense that if the dividends cover my living expenses I don't have to "do anything" and because I didn't sell any shares I get a (perhaps false) sense of victory... especially when markets are down.

That said, I didn't find any tool out there that could easily tell me the quarterly and monthly cashflow of various investments over specific time periods. Mostly the calculators tell you how much something appreciated (with dividends reinvested) or they tell you without, but the monthly cash flow was hard to visualize.

So I threw this together over the course of a couple of days.

http://www.divicalc.com/index.php

It's still super rough and not good at error handling. I have run through a bunch of different stocks, etfs and mutual funds and it SEEMs to work. I also sanity checked the returns by doing it manually (painful) so I THINK it's pretty accurate.

Throwing it out there to see if:
1) is this useful at all?
2) what could make it better (assuming yes to 1)?
3) Is there something that already does this that I missed (still had fun making it )?

What I would do Next.
-Be able to have 10 or so stocks with % allocation
-Do a forward looking monthly cashflow analysis (i.e. use dividends to go forward instead of just dividing by 12)
-include fees (fund expenses, taxes because of turnover, etc).
-pretty graphs (especially around the change in income flow).

I was pretty amazed, for example, that Wellsley (VWELX) had a pretty large drop in distributions in 2008... well I guess not amazed since that's expected... but it was REALLY big. So I can imagine if I had most of my money in that fund and suddenly have to sell shares to cover monthly costs... that could be psychologically tough.

VBFX (bond fund) on the other hand has a nice, smooth payout through the tough times... but you can see the monthly payments dropping quite a bit over time.

anyway... just thought I'd share.

[eta2020]

It is useful. I often do this computation by hand on my holdings.

Worked for VIG.
Failed for VXUS and KO (Does not handle stock splits)

You should add ability to display 2 securities side by side so one can compare them.

[petershk]

Yeah. That's probably up next cause I do the same thing.

It doesn't handle splits yet but I figured out how to get the data. So next update will do that. Thanks for texting

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[eta2020]

Quote:

Originally Posted by petershk I was pretty amazed, for example, that Wellsley (VWELX) had a pretty large drop in distributions in 2008... well I guess not amazed since that's expected... but it was REALLY big. So I can imagine if I had most of my money in that fund and suddenly have to sell shares to cover monthly costs... that could be psychologically tough. anyway... just thought I'd share.

Start with 2007 and compare VIG, IVV and VWELX.

Only VIG had consistent raising dividend that one could rely on. I would imagine SCHD would have same characteristics.

I like VWELX but you can not count on its dividend going up year after year. As you said if you relied on VWELX distributions you would be forced to sell in down market.

BTW I am aware of this observation for a long time That is why I rather have goal of having enough VIG to live of off then for example VWELX. But it takes bigger pile of F-You money to build such portfolio

[petershk]

Quote:

Originally Posted by eta2020 Start with 2007 and compare VIG, IVV and VWELX. Only VIG had consistent raising dividend that one could rely on. I would imagine SCHD would have same characteristics. I like VWELX but you can not count on its dividend going up year after year. As you said if you relied on VWELX distributions you would be forced to sell in down market. BTW I am aware of this observation for a long time That is why I rather have goal of having enough VIG to live of off then for example VWELX. But it takes bigger pile of F-You money to build such portfolio

That's pretty interesting.
I got the split calculation working (I believe).
It's astonishing how varied the historical data quality is. For example:

Vanguard Total Stock Market ETF (VTI) Dividend Date & History - NASDAQ.com

show no dividend between 6/24/2008 and 3/25/2010, whereas

VTI: Dividend Date & History for Vanguard Total Stock Market

shows a very different payment schedule.

I'm using Yahoo data.. but since the dates and amounts vary (sometimes A LOT) it's pretty hard to fact check :P.

anyway, what I see with VIG and IVV is that from 2007-2016, total return on 1M is 742k and 685k respectively; but monthly average dividends between 2008 and 2009 drop from 1594 to 1521 for VIG vs a drop from 1574 to 1277 for IVV. That's quite a different monthly journey to a somewhat similar total return.

Does that match up with your calculations? Assuming you may have done them :P.

Early on in the development I had some pretty egregious programming errors that resulted in silly monetary results, but those are getting harder to find. Unfortunately small errors over long periods of time can be pretty painful!

[rbmrtn]

Nice job. Yes, it will be a useful tool. I look through the dividend champions spreadsheet here, The DRiP Investing Resource Center - DRiP Information, Tools, And Forms, it has some dividend history and growth rates but only for the listed stocks. They also have calculator tool that is somewhat similar. How To Create A Dividend Tracker Spreadsheet | Dividend Meter

A portfolio view would be good. I keep a spreadheet by hand but only for current values.

[eta2020]

Quote:

Originally Posted by petershk anyway, what I see with VIG and IVV is that from 2007-2016, total return on 1M is 742k and 685k respectively; but monthly average dividends between 2008 and 2009 drop from 1594 to 1521 for VIG vs a drop from 1574 to 1277 for IVV. That's quite a different monthly journey to a somewhat similar total return.

Yes it matches my calculations. This is because VIG and SCHD are ETFs focused on high quality wide moat companies. Those companies did not cut dividends in 2008-2009. BTW SCHD did not exists in 2008.

They outperform in declines and slightly underperform in cyclical bull markets. One hopes that net result is positive.

IE last 2 years VIG did better then S&P in flat market environment. 2 Years before S&P did better.

[marko]

Hey! I find this very useful and one more thing for me to play with ad-nauseum!

My only caveat--after a very quick review-- is that it combines dividends and cap gains into one percentage. That's fine if, like me you count them as the same, but for those looking for dividends alone in a fund that also pays cap gains, it could be misleading.

Otherwise, GREAT and Thanks!

[ESRwannabe]

This is cool. One nice feature you could add is to let you enter in the initial number of shares instead of initial principal.

[Chris7]

How about a final %Total Return and Annualized?

[Chris7]

I was looking up data on my T purchases. Since the calculator starts at the beg. of the year, the data is a bit off. There was a bit of a run up from 1/2012 to 8/2012. So maybe try to incorporate the actual purchase date.

Really cool tool, though.

cd :O)

[petershk]

Quote:

Originally Posted by marko Hey! I find this very useful and one more thing for me to play with ad-nauseum! My only caveat--after a very quick review-- is that it combines dividends and cap gains into one percentage. That's fine if, like me you count them as the same, but for those looking for dividends alone in a fund that also pays cap gains, it could be misleading. Otherwise, GREAT and Thanks!

Yeah that's annoying . I haven't found a good data source that separates them the way vanguard's site does. It's a hobby effort so I'm reluctant to buy high quality data... at least for now.

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[petershk]

Quote:

Originally Posted by Chris7 How about a final %Total Return and Annualized?

I'll add to the todo list. Makes lots of sense.

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[petershk]

Cleaned up the formatting a bit and added total and annual return (I think the math is right).

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[petershk]

Was also just looking at Altria's performance (MO) since 2001 and it's pretty insane.
in 2007 and 2008 they had a special distribution of 21.91 and 51.06 respectively, raising the monthly revenue on a 1M investment to 88k and 185k respectively. In the middle of 2008 that would have been insane extra cash to have lying around... Kinda rough on the taxes and MAGI though I guess :P.

Guess cigarettes are doing ok....

[eta2020]

Quote:

Originally Posted by petershk Was also just looking at Altria's performance (MO) since 2001 and it's pretty insane. in 2007 and 2008 they had a special distribution of 21.91 and 51.06 respectively, raising the monthly revenue on a 1M investment to 88k and 185k respectively. In the middle of 2008 that would have been insane extra cash to have lying around... Kinda rough on the taxes and MAGI though I guess :P. Guess cigarettes are doing ok....

I own it longer than that. I think that is spin off of Kraft and Philip Morris. Yea sometimes buy and hold works quite well.

[petershk]

Quote:

Originally Posted by eta2020 I own it longer than that. I think that is spin off of Kraft and Philip Morris. Yea sometimes buy and hold works quite well.

Ahh that makes total sense.
So was that a taxable event or not?

I haven't found a good spin-off DB.

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[Chris7]

The changes look great. What about an option to do calculations based on reinvested dividends. I have to get through a project for a son's graduation, but maybe after next weekend, I'll have more time to play with it.

At least for the stocks/ETFs, I have entered the data looks reasonably correct. And so far, I feel pretty good about my account and choices.

Thank you!!!
cd :O)

[petershk]

I have a todo item to add ability to choose when dividend reinvest stops (to model retirement date) as well as potentially comparing reinvest vs not reinvest.

Lots of ways to go .

I'm working on graph integration now which is worse than I expected.

Also... DW made the comment "wait... you are talking about ER and you're spending lots of time working on that?"

She gets it... just thinks it's funny

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[photoguy]

Pretty interesting tool. I track my dividend yield for my portfolio but since it's mostly broad index funds, the amount doesn't seem to change much.

Quote:

Originally Posted by petershk I'm using Yahoo data.. but since the dates and amounts vary (sometimes A LOT) it's pretty hard to fact check :P.

Are you able to download data in bulk from Yahoo? or do you query on the fly?