Sunday, February 3, 2013

Project $3 Million - January 2013 Results

This portfolio belongs to a 28 year old.

MONTHLY HIGHLIGHTS:

Project $3 Million closed at an all-time monthly high. Total portfolio value is $89,415.61.

Project $3 Million is 1 year ahead of schedule. The portfolio value at the end of 2013 needs to show $86,959.44 in market value to stay on schedule for the $3 Million objective.

Companies that have increased their dividends/ distributions this month:

Realty Income - (O) ... up 19.2%
Dominion Resources (D) ... up 6.6%
Health Care REIT - (HCN) ... up 3.4%
Magellan Midstream - (MMP) ... up 2.9%
Kinder Morgan Inc. - (KMI) ... up 2.8%
Kinder Morgan Partners - (KMP) ... up 2.4%
Enterprise Products - (EPD) ... up 1.5%

O, MMP, KMI, KMP  and EPD are all expected to have multiple increases in 2013.

The income for January 2013 is up 49.1% over January 2012.
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PRIMARY OBJECTIVE:

Income replacement! ... The objective is to start earning an income stream now to replace the income that will be earned throughout the working years. The goal is to achieve $10,000 per month income in retirement. The income stream will need to continue to grow to stay ahead of inflation. A portfolio of $3 Million with a yield of 4% will accomplish that objective. Hence the title of this portfolio ... Project $3 Million.

MISSION STATEMENT:

To earn an income stream that is reliable, predictable and increasing.

STRATEGY:

To focus on the safety of the dividend, then to focus on the growth of the dividend, and then to focus on total return. The formula to be used to put this strategy into effect is:

High Quality + High Current Yield + High Growth Of Yield = High Total Returns.

TACTICS:

To contribute $500 per month to the portfolio, look to earn 8.25% annually, compounded over 40 years (to age 65). The beginning portfolio value at the time of establishing these goals was $42,204.42.

The link below shows the compounding effect and where the portfolio value needs to be each of those 40 years, to achieve the $3 Million.

http://www.planningtips.com/cgi-bin/savings.pl?amt=42205.00&dep=500&cmp=annually&int=8.25&yrs=40&Calculate.x=50&Calculate.y=12

All dividends will be reinvested back into the companies paying the dividend. New cash will be used to add to positions or create new positions.

STATUS:

To stay on schedule for the $3 Million, according to the link above, the portfolio balance at the end of 2013 needs to be $86,959.44.

Project $3 Million has already passed the 2013 benchmark. It is now a year ahead of schedule! Portfolio value at the end of January is $89,415.61.
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DIVIDEND HISTORY:

Total Dividends for January are $212.71.
Total Dividends for 2013 are $212.71 ... up 49.1% over 2012.

THE CHOWDER INDEX:

The Chowder Index is what I use to determine if the portfolio is accomplishing its goals or not. Since the priority is income replacement, and we want that income to grow, we want to see where the income for each quarter is higher than the corresponding quarter of a year ago. I also want to see income growth year over year.

Year To Date Results:

2009 ... $21.79
2010 ... $80.25
2011 ... $102.18
2012 ... $142.68
2013 ... $212.71
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JANUARY DIVIDENDS RECEIVED:

TAXABLE ACCOUNT: (Dividends Reinvested)

Automatic Data Processing (ADP) ... $16.65 ... bought 0.285 shares
Pepsico (PEP) ................................. $17.73 ... bought 0.255 shares
Kimberly-Clark (KMB) ................... $19.38 ... bought 0.225 shares
Altria Group (MO) ........................... $45.36 ... bought 1.383 shares
Philip Morris (PM) ........................... $27.64 ... bought 0.31 shares
Kraft Foods (KRFT) ........................ $42.50 ... bought 0.917 shares
Sysco Corp (SYY) ........................... $31.28 ... bought 0.989 shares
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Portfolio Changes:

Bought 23 additional shares of Southern Company (SO).
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PORTFOLIO HOLDINGS:

Symbol ... Shares ... Mkt Value ... Gain/Loss ... Company

ADP ...... 38.552 ... $2,285.75 ... up 33.41% ... Automatic Data Processing
CL ......... 24.819 ... $2,664.82 ... up 34.94% ... Colgate-Palmolive
CVX ..... 22.759 ... $2,620.70 ... up 47.22% ... Chevron Corp.
DEO ..... 29.521 ... $3,521.86 ... up 72.96% ... Diagio, plc
EPD ..... 60.987 ... $3,456.13 .... up 47.55% ... *Enterprise Products Partners
FTR ..... 20.444 ... $93.43 ... Shares received in spinoff from Verizon ... Frontier Comm.
GIS ...... 76.745 .... $3,218.69 ... up 16.69% ... General Mills
JNJ ....... 43.341 ... $3,203.77 ... up 18.94% ... Johnson & Johnson
KMB .... 26.42 ..... $2,364.85 ... up 34.16% ... Kimberly-Clark
KMP .... 35.558 ... $3,161.11 ... up 22.38% ... *Kinder Morgan Partners
KO ..... 108.937 .. $4,056.81 ... up 55.86% .... Coca-Cola
KRFT ... 85.917 ... $3,971.08 ... up 1.59% ..... Kraft Foods
LMT ..... 35.151 ... $3,053.57 ... up 8.18% ..... Lockheed Martin
MCD .... 35.095 ... $3,344.20 ... up 32.89% ... McDonald's
MMP .... 80.519 ... $4,075.07 ... up 87.45% ... *Magellan Midstream Partners
MO ..... 104.466 ... $3,518.41 ... up 60.36% ... Altria Group
PEP ...... 33.248 ... $2,422.12 ... up 17.58% ... Pepsico
PM ....... 32.832 ... $2,894.47 ... up 21.88% ... Philip Morris
SO ....... 68.318 ... $3,021.71 ... up 12.38% ... Southern Company
SYY ... 112.689 ... $3,580.13 ... up 6.14% .... Sysco Corp
Cash ..................... $302.45
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Account Value: ... $60,831.11

*Means increased the dividend in 2013.
~Means decreased the dividend in 2013.
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ROTH IRA:  (Dividends Reinvested)

January Dividends:

Realty Income (O) ... $12.17 ... bought 0.281 shares
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Portfolio Changes:

Bought 42 shares COP
Bought 68 shares KMI
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PORTFOLIO HOLDINGS:

Symbol ... Shares ... Mkt Value ... Gain/Loss ... Company

COP ..... 42 ......... $2,436.00 ... dn <2.49%> ... ConocoPhillips
D ......... 69.821 ... $3,778.01 ... up 15.32% .... *Dominion Resources
HCN ... 42.136 ... $2,647.83 ... up 13.21% .... *Health Care REIT
KMI ... 68 ........... $2,547.28 ... up 13.21% .... *Kinder Morgan Inc.
O ........ 80.485 .... $3,515.58 ... up 21.28% .... *Realty Income
PG ..... 34.426 ..... $2,587.46 ... up 19.33% .... Procter & Gamble
VZ .... 115.332 .... $5,029.63 ... up 16.40% .... Verizon
Cash .................... $19.72
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Account Value:  $22,561.51
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THRIFT SAVINGS PLAN (TSP) - Federal Version of the 401K

There isn't any company match in this account. Only 5% of income is being contributed. Index Funds and Life Cycle Funds are the only options to choose from.

Fund - Tracking Index ........... Shares ...... Value .... Percentage of Portfolio

F Fund (Fixed Income) ... 17.3252 ..... $275.83 ...... 4.66%
C Fund (S&P 500) ....... 100.8682 ..... $1,912.50 .. 32.39%
S Fund (Small Cap) ........ 74.4903 ..... $1,939.00 ... 32.73%
I Fund (International) ...... 82.1329 ..... $1,795.66 ... 30.32%
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Account Value: ..... $5,922.99

Contribution Allocations:

F Fund ... 10%
C Fund ... 10%
S Fund ... 35%
I Fund ... 45%

  










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