I always love reading blogs about other investors’ investment income. Watching other people’s investment income rise is my second favorite thing (the only thing better is watching MY investment income rise!)

Here is our investment income for February, 2021. This report includes income from dividends, interest, mutual funds, and rental properties.

Overview

Without further ado, here’s what our investment income looked like for the month:

Dividend & Interest Income

Total dividend income for the month was $2,288.56. This is down a brutal 22% from February, 2020. The drop is because Starbucks didn’t pay dividends this month (the payment was deferred until March). In addition, it looks like Nike has just skipped its Q1 dividend and will pay the next dividend on April 1st, so our quarterly dividend income is going to be affected.

Our long-term goal is to have our dividend income increase by 10% per year, and unfortunately we came up short in 2020. My goal for 2021 is to receive $88,000 in dividend income (vs. $80,396.95 in 2020).

Rental income

This category includes net income from the 6 rental properties that my wife and I own, plus 50% of the income from 4 rental properties that we own with my mom. This number does not include appreciation of the properties or the decrease in the mortgage balance (those numbers show up in the net worth report).

However, this income is net of all mortgage, tax, and insurance payments. That is, this is a true cash flow report for our rental properties.

All properties are rented and we were finally back in the black for our rental income ($790.93 for the month). We made the final payment on an improvements to one of the properties (new tile throughout the house), and that ~$1,200 payment is why our total income for the month wasn’t higher.

Over the last few years our rental profits have been erratic. This is unsurprising, given the number of rentals we have. March should be a good month now that all properties are rented again.

Total investment income this month

Dividend + rental income = $2,288.56

Total monthly income was down a painful 54% from February, 2020. Definitely not the way we wanted to start the year.

For the year (through the end of February) our income is 46% lower than it was through February, 2020. We clearly have a lot of work to do just to catch up to last year, much less increase our income for the year by 10%

Changes

For a number of months I’ve felt like Tesla (TSLA) was incredibly overvalued, so I decided to put my money where my mouth is.

2/22/21 – purchased 10 puts on TSLA at $500 for $17.49/share for a total of $17,496.50 with expiration of 5/21/21.
2/23/21 – purchased 10 puts on TSLA at $500 for $24.90/share for a total of $24,906.50 with expiration of 5/21/21.

As of 3/5/21 these options are up 111.31% for an unrealized gain of $47,197.

I also purchased some downside protection on the general market by buying some puts on SPY (S&P500 index).

2/23/21 – purchased 50 puts on SPY at 330 (S&P 500 3,300) for $6.75/share for a total of $33,782.50 with an expiration of 6/18/21.

As of 3/5/21 these options are up 2.64% for an unrealized gain of $892.50.

The Tesla puts have obviously worked out pretty well, as the stock has been in free fall for the last few weeks (when I bought the puts the stock was between $700 and $725 and is now at $587).

The S&P puts are more or less even, but I like having the downside protection for the next few months. In order for the options to be in the money the S&P 500 index would need to drop by about 20% from when I purchased the puts.

Recap

So far 2021 has not been good for our passive income. However, the Tesla puts have the potential to make some decent money, and that could make up for a lot of other problems in our portfolio.

I’ll officially recognize the gains/losses from my options when I sell them.

How did everybody else do with their investment income this month?

Are there any investments out there trading at reasonable valuations that I should be looking at?