Needless to say, 2020 did not go according to plan.  We saw a big market decline at the onset of the pandemic, but that was followed by a good recovery over the subsequent months.  In the end, the overall market finished higher, but gains were concentrated in a few sectors.

We saw plenty of dividend cuts & suspensions during the year, too… certainly more than we’d seen in some time.  Unfortunately, these dividend events put a damper on generating more dividend income.

When the year was over, dividend income seemed to be impacted more than portfolio values, and that’s unfortunate, as the DGI community is usually focused on dividend income.

In any case, we made it through the year and hopes are high that 2021 will offer better results for us.  However, before we can move on to 2021, we need to wrap up 2020.

A year ago I laid out 3 financial goals for 2020 related to my dividend Portfolio, along with two additional bonus goals.  It was my 3rd year of setting Portfolio goals.

How did I do with regard to achieving those goals?  I’d have to say it was hit and miss.  I haven’t had a clean sweep in any year yet, but that’s probably a good thing, as if I did I’d estimate that I might be too conservative in my goal setting.

As usual, my 2020 goals were centered on minimum levels of investment and generating additional dividend income.

At mid-year, I did a goals review and on average, I was not on pace to accomplish all my goals.  However, I had time to make adjustments… but did I?  And did it help?

Below is the list of goals I had for 2020.  I’ll discuss where I stood with each at mid-year, and then where I ended up with regard to achieving the goal.

Here we go…

 

Review of 2020 Portfolio Goals

1) Invest at least $10,000 of new capital in the Portfolio

This investment amount goal was the same as I had in 2019.  It’s the one I probably have the most control over, as well.

While I set the goal at $10K, I assumed that landing in the range of $6K to $12K was the most likely outcome.

In the first half of the year, portfolio transactions were high, but my net investment was fairly low, as I was adjusting my Portfolio, as opposed to investing in it.

I reached the mid-way point with a Portfolio investment totaling $3,135.12… well off the needed pace to reach my goal.

However, things picked up in the 2nd half of the year and I met my goal.  I finished with an investment of $10,485.56… surpassing my goal my approximately 4.85%

During 2020, I executed a total of 68 transactions…. 47 purchases and 21 sales.  The majority of the transactions (48) took place in the 1st half of the year.

SUMMARY – GOAL MET!

 

2) Reach $12,500 in annual forward dividend income

I started 2020 with a projected annual dividend income of $10,804.29.  This meant I would need to add $1,695.71 in additional forward dividend income during the year in order to reach my goal.

Since I’d managed to add a smaller total of only $1,527.87 during 2019, this was a rather aggressive goal for 2020.

However, at the halfway point of the year, I’d only reached $11,603.11 – about a $600 gain from the starting point.  Even my more conservative goal of $12,250 in annual forward dividend income by year’s end was in serious doubt.

I felt like the muted dividend raises we were seeing, not to mention the handful of dividend cuts/suspensions I’d already realized, were going to be too much to overcome by year’s end.  Thus, I’d projected a failure to reach this goal during my mid-year review.

Unfortunately, this projection was realized.  In fact, I fell well short of my goal and wrapped up the year with $12,036.14 in annual forward dividend income… almost $500 behind my goal.

On the bright side, I did manage to eclipse the $12K level for forward dividend income… a major milestone, meaning that on average I’d collect $1K/mo. in dividend income moving forward.

SUMMARY – GOAL MISSED… by a significant amount!

 

3) Obtain $11,700 in actual dividend income

In 2019, I cracked $10K of actual dividend income on the last day of the year, finishing up with $10,049.68 of actual dividend income.  This was an addition of $1,589.34 compared to 2018.

Thus, the $11.7K goal I set for 2020 was going to be challenging, as it was going to require over $1,650 in additional dividend income compared to 2019.

I projected a 15%-19% increase for 2020, putting my dividend totals in the $11,557.13 to $11,959.12 range by the end of the year.  More specifically, I targeted a ~16% gain, giving me the $11.7K goal.

However, once again, the dividend cuts/suspensions we saw during the year were a setback here, as were the reduced dividend raises.  At the halfway point of 2020, I’d collected $5,761.68.  This was a little shy of 50% of my goal.  At the time, I was declaring that reaching this goal was a longshot, even though I wasn’t giving up hope.

When 2020 was over, my Portfolio generated $11,634.54 in dividend income for 2020.  An unexpected special dividend from Fastenal (FAST) in December, and Nike (NKE) moving their Jan. 2021 dividend into Dec. 2020, got me quite close to my goal, but it wasn’t enough to make up all the ground lost over the course of 2020.

SUMMARY – GOAL MISSED… but it was close!

 

Bonus Goal #1 – Increase the weighting of Technology in my Portfolio

While the stated goal was to increase my Portfolio Tech weighting, I targeted getting my Tech weighting to be within 5% of the Tech weighting of the S&P 500.  When 2020 started, my Portfolio Tech weighting was ~14%, while the S&P 500 had a Tech weighting of ~23%… a good 9% delta.

At mid-year, I’d reduced the delta to about 8% (19.5% vs. 27.5%).

My Tech additions in 2020 included Broadcom (AVGO), Automatic Data Processing (ADP), Cisco Systems (CSCO), and Microsoft (MSFT).  CSCO was a late 2019 Portfolio addition that I added to in 2020.  The other 3 were positions initiated in 2020.  I made several small share additions of AVGO and ADP during the year… so many that AVGO ended 2020 as the 15th largest position in my Portfolio, and ADP ended 2020 as my 23rd largest position (out of 50 stocks).

By year’s end, my Portfolio Tech weighting was ~21%, while the Tech weighting of the S&P 500 was ~28%.  So, I was able to raise my Tech weighting by a good amount, however, this only narrowed the gap compared to the S&P 500 by a couple of percentage points (from a 9% delta to a 7% delta).

SUMMARY – GOAL MET (technically)… I didn’t get to <5% delta, but I did increase my Tech weighting!

 

Bonus Goal #2 – Add a Utility stock to my Portfolio

My Portfolio has been missing a Utility stock since June 2018, when I sold SCANA (SCG).  The higher yields that come with Utilities is nice, but the earnings and dividend growth is often not significant.  With no current need for the extra income Utility stocks can offer, I’ve leaned toward growth over yield for my Portfolio.

That said, I went into the year hoping to add one Utility stock to my Portfolio, and obtain some minor exposure to the sector.

By the middle of 2020, I hadn’t found a stock I wanted to add.  The primary stock I was targeting, NextEra Energy (NEE), dipped to an acceptable level during the March decline, but I was busy adding other stocks at the time and missed my chance.

I took a look at Pinnacle West Capital (PNW) during the year, too, but didn’t pull the trigger on that stock either.

So, I finished the year where I started… with no Utility stock.  I’ll keep looking in 2021.

SUMMARY – GOAL MISSED!

 

Summary

So, it was definitely hit and miss when it came to my 2020 Portfolio goals.

Of the 3 primary goals I had, I achieved 1 of the 3 goals – my worst performance in the 3 years I’ve been doing this.

I met my new capital investment goal, but missed my annual forward dividend income goal by a big margin, while just missing my actual dividend income goal.

With regard to the 2 bonus goals, I managed to achieve 1 of the 2.  I was able to increase my Portfolio Tech weighting, but didn’t find a way to add a Utility stock to my Portfolio.

Despite missing on the majority of 2020 goals, my Portfolio continued its growth (both in value and dividend income), which is ultimately what I’m after – so I’m happy about that.

 

My 2021 goals should be posted in the coming days, so keep your eyes peeled for that.

 

Were you able to achieve some of your 2020 portfolio goals despite all the headwinds during the year?  If so, which one(s) were you happiest about?  Please share in the Comments.