Avoid over-tightening
I had the same problem with my Cat 30 so I got in there and tightened the packing nut. Well, after motoring around the harbor about a half hour, I heard this awful noise. The packing nut had gotten so hot that it expanded and un-screwed itself, stripping the threads, then imbeded itself into the back of the threaded shaft by the transmission killing the engine. The result was that water was pouring in and the nut was stripped and un-movable. The only thing I could do was wrap it with duct tape and sail back to the slip. Make sure after you adjust the nut and stop the dripping that you can easily turn the shaft without generating any friction. Run for 5 minutes in gear and feel the stuffing housing for excessive heat, there should be none. Good luck and I hope you never have my bad experience. Jeff