OK, I don't want to give the game away, but after running the numbers from my recent wage (which was my biggest ever monthly wage!), I found out that I had enough capital to invest in my Kindle business and plenty to spare to buy shares in one company. Can you guess who I opted for? Well done you, yes it was BHP Billiton.
Some of you may be interested to know that I spend approximately £85 (this is a top end number to be conservative) to create and promote 1 x Ebook for Amazon and a paperback for Createspace - The £85 covers both formats. I'm looking to create 3-4 books a week, so I want to make sure I have £1,000 to £1,400 (again, overly conservative numbers) to continue investing in Kindle each month. It's no good just covering my expenses, and not putting money back into the business in my opinion.
I received just short of £2,900 in my bank account this morning which is the most money I've ever earned in a single month at work - I plan on beating this in the next 12 months going it alone and making it a regular income amount.
I recently earned £521 from Amazon, and I still had some left over money in my Kindle bank account. I added the sums together and took this amount away from the £1,400 to see how much I needed to invest in my Kindle account to cover my monthly costs this month. It runs out I had plenty left over to purchase shares in one company, but just short of what I needed to invest in two. I decided to play it safe and invest in one for now and have surplus cash on hand in case I need it over the next couple of months.
I could have used up to £1,600 to invest in BLT, but I already had over £200 in my ISA from AML and DLG dividends this year, so I transferred a much more conservative £1,350 into my ISA instead. This leaves me with yet more surplus cash if required.
As we move into the month of August, I have plenty of capital to invest further into my business, and I've managed to kickstart my ISA investments once again. May was the last month I put money into shares, and I have to say, it feels great to get it moving once again. I have missed the feeling of satisfaction I get from pumping money into my portfolio. The value may go up and down from month to month, but as long as my contributions continue to rise, I know I'm onto a winner long term.
My forward dividends are now approximately at £1,900 for the year. This would suggest that I'm 2 x investments short of my dividend total for the year. I'll be making one investment in October with the dividend I receive from my H&L ISA (which currently sits at over £600). I'm not sure I'll earn enough in between now and then on my reduced hours to invest in a company that will pay sufficient dividends by Dec 15.
It's not over until the fat lady sings - my Kindle Income could shoot up which would allow me to invest earlier, I could receive Special Dividends, or significant dividend increases in the autumn. It should be an exciting finish anyway.
On Wednesday 5th August 2015, I bought 128 shares in the FTSE 100 mining company BHP Billiton. The share price at the time of purchase was 1190p. The total cost with charges included was £1,535.82.
I bought shares in BLT back in December 2014 in my H&L ISA - Click on the click to review my previous write up on the company and my decision to buy shares in them.
So what's happened since Dec 2014?
BLT increased their interim dividend in March 2015, and they went ahead with their plans to separate part of their business into South 32 in May. Shareholders were anticipating a drop in share price to the spin off, but both BLT and S32 have continued to slide since May.
BLT are now trading at a price they help back in March 2009. However, I feel that the company is looking more promising now than they did back in 2009. Their Earnings per share, Revenue and Dividend is higher now than it was back then (prior to their interim results - end August). They're the biggest mining company in the world, and they've continued to increase their dividend since 1999 - Even through the recession.
There's a possibility that the share price could sink further, but rather than trying to time the market, I decided to take the plunge now as I was very happy with the current price they were offering. BLT are currently paying dividends at over 6% (if they continue their annual dividend increases), they have a P/E of 6.42 at the time of writing, which is extremely low, and a PEG of 0.3. This suggests to me that there is a lot of growth potential in their current price, and I'm happy to invest in them now for the long term (30+ years) to try and benefit from some of that.
What do you think of BHP Billiton at the moment? Can you hear the 'Fat Lady singing' for my 2015 Goal or is there life in it yet?
Labels: Dividend Growth Investing, Dividend Income, Kindle Publishing, Stock Purchase