SPYI
SHP ETF Trust - NEOS S&P 500 High Income ETF
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To all the MSTR preferred holders
How are covered call ETFs taxed in an inherited IRA?
How much should I care about TER when investing long-term?
Fidelity is the WORST! No total return feature still?
Portfolio is -80%. learn from me. Offer advice if you can
Why people have $400k USD to million can't make good decisions? Robinhood Screenshot on wallstreetbet FKing crazy.
Transitioning from the Accumulation to Distribution.Spend phase of life and generating income in retirement?
Question about Roth IRA distribution at 59 1/2 and older
Which defense ETF should I keep? I'd appreciate any insight
Leveraging $1M+ portfolio using *Margin* and CC ETF's to generate additional income
Investing Advice For A 38 YO Healthcare Business Consultant.
anybody investing in these 10%+ dividend yield ETF's?
How can the SEC yield be so much lower than the distribution yield, and what does that mean for future dividends?
young buck looking for some advice from the seasoned veterans
Mentions
Got 2k euro to invest and 10 year timeframe Unsure where to invest. Should I stay boring and invest in SPDR MSCI ACWI IMI UCITS ETF (SPYI). Also thinking of investing all the money in NASDAQ-100, I think with 10 year the risk is mitigated unless a type of dot-com crash happens? Goal is maximum wealth generation. What would u recommend?
SPYI I think I got like 127 shares Most of my cash is sitting in SPAXX because I plan on purchasing roughly an acre of land. Got like 34,000+ shares
i use SPYI to generate an income and I use it to pay for my mortgage (and property tax, insurance). It's only a small (but not insignificant) part of my portfolio. It's NOT for growth. It's for income. I also invest in the SP500 index for growth. I'm in my 50's and if i lose my job, it'll take a while to get a new one these days so i want a safety net.
i’ve seen the numbers, SPYI’s gross yield is nice, but the 0.85% expense and the fact that all the earned call premium is taxed as ordinary income means the after‑tax return is nearer to the 3.2% you’re already getting. if you want a consistent monthly income that won’t fall when the S&P starts to wobble, a short‑term Treasury bill or a money‑market fund is a cleaner choice. if you’re okay with the upside being capped and you can stomach a period where the dividend comes down to zero, then a portion of the capital into SPYI could still make sense—just make sure you have a cash cushion if the market drops.
Will you need to sell shares to cover expenses or for future needs? USFR and SGOV have ~3.7% - ~3.9% risk free with little to no volatility. JAAA and PAAA are popular on Reddit and offer around ~4.5% with ~1.5% volitility. SPYI is still very tech heavy with ~12% vol at .68% ER. The fund has only been around since 2022. It will crash along with SPY if there is a drawdown. It really just depends on what the purpose of the capital is. State, federal taxes, and tax bracket is also something to consider.
It all depends on what you want the money to do, but from the question it sounds like this is money that needs to be kept safe. A different way to increase your income with a small increase in risk would be a CLO ETF like JAAA. This is yielding closer to 5%, and while there are risks with CLOs they are less than comparable instruments yielding that amount. Do your research of course but I like them as a place to park cash while yielding a bit more than cash. I agree with other posters SPYI is not a good idea long term as it will always under perform it's underlying (SP500). SGOV and the other short-term bond funds are also great options.
Covered call ETFs are intended for income, e.g retirement. SPYI tracks the S&P500 but risker because there are higher fees and your upside is capped. CC ETFs have never been in a major market correction so we don’t know what will happen if there is a 2008/2000 etc). Do you need 73k cash? Emergency is 6 months of spending
SPYI works by buying the the stocks of the S&P500 at there market wait then selling covered calls on those stocks. This is called a “covered call strategy” In the long term a covered call strategy is expected to underperform the the assets it’s selling covered calls on. If you do a quick compare to VOO that is what you should see. These kind of funds also tend to have higher fees. If you want to increase your risk to get a better return SPYI is not an efficient way of doing so.
I’d be careful about comparing the two based only on their monthly payouts. The JPMorgan deposit offers a more predictable return, while SPYI’s distributions aren’t guaranteed and its share price can fall. Past recoveries don’t guarantee future performance. If you’re considering switching, think about how much risk you’re comfortable taking and whether you’d move only part of the money rather than all of it.
You’re comparing a savings account to an equity income ETF, which isn’t really apples to apples. SPYI uses covered calls so the yield looks fat but you’re capping upside and still eating the full downside. The price trend looking fine in the past doesn’t mean much when the market decides to throw a tantrum. If you need this money in the next couple years I’d leave it where it is. If you’re okay watching 70k turn into 50k for a while in exchange for higher income, that’s the tradeoff you’re signing up for.
that is why i took profits on my stocks above 100% gains (All of them Tech stocks or industrial stocks connect to AI) and put it SPYI or High Yield savings. Once that bubble pops, it will be great recession bc top 10% ain't buying goods no more. They will be eating noodles.
Meh get SPYI if you plan on holding forever
$60,000, @ 10% annually is $500/month. Ive done that with an equal mix of IDVO, SPYI, IAUI, and MLPI. How you get there is by adding money every month regularly. You need to define your risk though. The risk of catastrophic failure, very low The risk of not making as much money as you would if you didnt use dividends, its a guaranteed loss. Gotta take into account losses due to taxes and internal fund friction of generating dividends.
Just in time for indexes to eat shit as a result of the AI bubble pop. Those index funds are more than 40% AI bubble whether you choose VT, SPY or QQQ. But I'm with you in solidarity. 25% SPY, 25% VT, 25% SPYI, 10% TQQQ and 5% TLT for the rest of the year. Rest in money market. Will probably sell weekly 2% OTM calls on the SPY position. YOLO.
The 6 months of living expenses in cash is just a starting point. for ememgencies you don't want to rely on a fixed ammount of cash. What happens when eh emergency exceeds your cash avaialable. Also maintaining the 6 month of cash becomes an additional expense on your work income. Long term you should shift away from cash to passive income from dividends. Once your account exceeds 6 month of cash take the excess and invest it in a dividend ETF. For example SPYI 12% yield and it is tax efficient meaning you pay little in taxes. 60K in SPYI would generate about $600 a month in cash dividneds a month. IF you turn off automatic dividned reinvestment you could use that cash to keep your 6 month of evmergency cash full without using your work income. And whenever you have more than 6 months of cash invest that for more dividneds. Eventually you can have what i have now. Dividend income of 5K a month which equals my living expenses. So once you have monthly dividend income that equals your living expenses you could loose your jobe and be unemployed a year and still be able to pay your bills and and put food on the table. And if you don't need this extra income you can put some in your Roth account to help save for retirment. Building an emergency cash dividned fund in a taxable account should be done at the same time you are building a retirement account.
A good qualifite covered call fund would be my choice. QQQI 14% yield, SPYI 12%, IWMI 14%, and MLPI 14%.These funds have a yeidl high enough that they should be vclose to doubling in value 7 years with all dividends reinvested. And in addition to this they are very tax efficient due to tax loss harvesting and and the resulting ROC dividneds they produce. Now the dividneds may go up and down with he market but they won't go to zero But VOO in a bad market can have negative earnings or ever zero for an extended period of time. And governmentbondds don'tprodcue any meaningful yields.
Is the intent here to sell after circa 7 years, or to get a dividend or dividend like payout continuing after 7 years of DCA contributions, if the idea is to hold and get payout until you pass it along at inheritance with step up, I would look of OVL combined with SPYI, and maybe MBOX, just be aware since these return money as ROC which the IRS does not count as income so does not count towards AGI much until the basis runs out in 10+ years there are tax implications both positive and negative, with the basis and capital gains resetting when you die and pass it on. Of course VOO, VT, VTI, VXUS, etc is probably the safer bet
dividnend are never guaranteed. they can be reduced at any time. Covered call funds like GPIX will likely reduce there payout in recession or market crash But non covered call funds are much more likely not cut the dividend. even bond funds may not reduce the dividend. fore example UTF7% yield, UTG/ MAIN 5% did not cut the there yield in 2008 the worst market year since the great depression there share price took a big hit but they continue to pay a dividned. But that said ETFs, mutual funds and CEFs are much more resilient since they have many stocks instead of just one. So funds likely will never see the yield go to zero. Tocompensate for dividend payment variations many use a mix of dividend fund say 6 that way if onegoes bad it will only effect 1/6 of your income. And it each fund is invested differently that also helps. Lastly you can target a higher dividend income stream than you need that way if the dividend is reduced you might still get enough income Using dividend for an emergency fund is far better than just a cash emergency fund. Simply because the dividneds will keep comming in while a cash emergency fund will run out of money I currently have in a taxable fund investments in QQQI, SPYI, EMO, UTF, UTG, PFF. Dividend reinvestment is off so the dividend will show up as cash in a money market fund. I keep 6 months of available at all times. And if the cash amount exceed 6 month. I can reinvest the excess for more dividends or Choos etc keep a larker emergency fund This works well for emergencies in that if you exceed the cash ammount you still have the money income (All these funds pay monthly dividends. Yes the dividned can drop fromQQQI and SPYI in a recession but the other 3 and the money market fund are more resistant to dividend cuts. PFF and EMO invest in companes or assets that are also more resistant to dividned cut and alll pay qualified or ROC dividend to minimize my taxes eventually increased the dividned income so that right now it covers all of my living expenses. and then I have added the non covered call fund and em building they to hopefully reach 10K a month of income. So that if my income does drop in the next recession I still should be able to cover all of my living expenses. I retired at 55 with my taxable covering all my living expenses and I do have S&P500 index fund in this account that I can sell at a loss if needed to cover expenses. I also still have my 401k and Roth
Need index's, higher yields, tax efficiency, covered calls, and low expenses. Stuff like SPYI, MLPI, JEPI, SCHD. Also diversify into international and oil. No gold, no real estate.
People tend to think of an emetency fund as just cash. But your investments can also be your emergency fund. And using you investmnent this way can work better in in real emergency. For example instead of cash you can hold an assets like the S&P500 index funds. and must sell toff in an emergency. Now yes youmightsell it at a loss. But the same time when you don't need it is growing faster than High Yield Savings Account earning 4%. But if you compare an index fund to dividend or coperate bond funds. you will find dividned like CLOZ that stays within =/- $1 price rang and pays 7%. Yes it don't have growth but the yield is higher. So the risk selling at a big losss is quite small when compared to growth index funds. And then there are funds SPYI with has a little bitof growth and a yield of 12%. So if you sell this fund You will probably sell at a small profit. And reinvesting 12% yield is better than any savings account. But the you have 12% yield do you really need cash savings. SPYI also pays in its dividend montly. so 100K invested in it is 1K a month of income. So all you have to do is turn off dividend reinvesting and the money cash will show up in a money market account which is similar to HYSA. You could hold onto 6 moths of dividends in the money market account. And if that isn't enough you still have 1K a month comming in. If you cash build s to more than 6 moths you can reinvest it in the dividned fund. You could easily use thedividneds to growth this emergency portfolio over time until the dividned is more than 3K a month. Without adding a dime of work income. With several K a month coming in you could also start coverneidn regualrexpeneses with your dividend income which will allow you to save more work income. I have a taxable account with QQQI13% yield, SPYI 12% , KGLD 12%, EMO 8%, UTF 7%,UTG 6.8%, PFF6% Thisaccount today These funds today generate more than enough to cover my 5k a month living expenses. And it allowed me to retres about 10 years earlier than i wasorinonally expecting And I have stated some money a S&P500 fund thatI can tap for big expenses if need or if my dividned income is reduced in the future. And this is in addition Tony 401K and my roth. and age 60 instill several years away. I started out with 401K and maxing out the deposits every year and built a a small growth index fund for emergencies. And generally only had about 3 months in banks savings. Fortunately I worked 32 years at one company and never got a layoff notice. I didn't know anything about dividned until about age 45.
You never know how long an emergency will last in 2008 many people were unemployed for at least a year. A friend of mine was unemployed for 8 years. The answer to this quest is to not have a pile offish. You simply will never know if it is enough. Instead invest your money for income there are many companes out there that have payed a dividend for many decades without reducing or cutting the dividend. And there are many ETFs, and CEFs that have also done this. I use QQQI, 14%yield, SPYI 12% KGLD 11%, EMO 8%, UTF 7%, UTG 6.8%
Cash is never a defensive position. If you need to tap and spend it it is gone forever. And if another bear market happened a few years later you will have less cash available. You are better off adding dividends to upper portfolio. Dividend fund produces steady stream of income. i took growth in my taxable brokerage account and and invested it in QQQI 13% yield, SPYI 11% EMO 8% UTF 7%, KGLD UTG 6.8%, and PFF 6%. Today my taxable brokerage account generates 5k of cash per month. Dividend reinvestment is off and the cash aqumulaqtes in a Money market acount. Money market accounts are brokerage equivalent to to HYSA. I keep 6 months cash available in the money market account. Any excess money I can spend. It generates enough cash to cover my living expenses. Now it does take time to build this account. But if you start building QQQI and restrict you HYSA to 6 months and putty excess money into QQQI you could start using the divine income to keep your HYSA or money market account and eventually cover regular month bills and expenses. Anid if you loose your job you can live off the dividend income indefinitely. And you still have cash available for the unexpected expenses.
I can confidently say none. I have some (handful) individual dividend stocks that are well researched and have done great in terms of growth over the years (GS, CVX, TSM, etc) and most of the rest in index funds (sp500, Russell, some tips and short term treasury) and SGOV. SPYI for income to cover housing in case of job loss. That’s not part of the growth strategy, just for peace of mind.
In my taxable account Invested in dividend covered call dividend funds and some closed end funds for dividend income. For example QQQI has a 13% yield and it is tax efficient. If you had that in your taxable brokerage account you could put money in QQQI and reinvest the dividned to build up income can use the income to to start a roth retirment accounts and pay for th 7500 per year deposit limit. In invested in QQQI, SPYI 11% yield, KGLD, EMO 8%, UTF 7%, UTG 6.2%, PFF 6% Today these funds generate enough monthly income to cover all my living expenses (about 5000 a month. And at that point I retired. Every dollar of income your investments generate is one less dollar of work income that doesn't have to be spent for retirement saving, food, or gas for the the car.
The brokerage equivalent to HYSA is money market account. Money market accounts are insured like HYSA. But since a money market acount is in a brokerage you can use a dividend investment to fill your money market account. For example you can put money in your taxable brokerage into a fund like QQQI 13% yield and it tax efficient. . So you could gradually build up QQQI so that is has 57K invested. At that level the yearly dividend is 8K. Which is enough to deposit into the Roth without using your work income to make the deposit. To get enough interest from a HYSA to get 8K you need to invest 200K. So with QQQI in your taxable account you you could turn off dividend reinvestment so the sad dividned are not reinvest and show up as cash in a money market acount. Eventually the taxable account could be also used as your HYSA. with QQQI filling the money market account. And at that point you won't need to put your work income into your Roth or your HYSA. And if you count to build up the dividned income with QQQI or other dividned funds you could eventually get enough taxable income to cover all of your living expenses. And you can have growth investment in your Roth I have QQQI, SPYI, BTCI, KGLD, EMO, UTF, UTG, PFF. to maintaning 6 month cash emergency fund and enough income to cover all of my living expenses (about 5K a month). It allowed me toretire early.
all investors generally have 3 goals 1. Short term cash saving for the occasional unexpected expenses. 2. A stead stream of income to cover living expenses in the event of unemployment or retirment that will last indefinitely. 3. and long term saving for very big expenses For most people #1 is typically a bank saving account or a brokerage money market account or a governe,ment bond fund. For #3 you can use a abank account but a north index fund like EXQT is a much better choice. But for 1 and 3 they both have a finite ammount of money available bye so using these means your net worth will drop. and they could eventually run out of money. \#2 is the most often overlooked category in investing. In this category you invest in funds that pay dividneds. The primary goal is to have a secondary source of income you control not your employer. So the income from these funds doesn't come form selling shares or depleting cash. Many use government bonds very safe but low yields. With the low yields So most people never have enough money to get the income they need with low yields So you really need yields of 5 % or more. Eventually you want enough income cover all of your living expenses so that you can live normally without working indefinitely. Now I use QQI, SPYI, KGLD, EMO, UTF and UTG to dividend income. But I live in the US and if you invest in these funds you will you have to deal with US tax withholdings. SO you should look for a canadian fund that pays high safe yield. perhaps a corperate bond fund. But I don't know what is available to you. Also for #2 you generally want to use an account type that allows access to the income at any time. Many retirement funds restrict access until you get close to age 60.
The point of an emergency fund is to have case available for the unexpected big bill. For example you get into an accident and have to stay in the hospital for a week. OR there is a storm and your home gets hit by lightening and your outlets and lights stop working. Or you get into an accident and need a new car. These thing do happen. The emergency fund was never designed to protect you from a market downturn which might last 1 to 10years based on historical data. The 6 months of living expenses is often recommended because anything more than that you would be better off with investing it. But if you invest it select an investment that will resolve your your biggest inviting concern. For example:If you don't want to sell stock in a downturn invest in a dividend fund like QQQI 13% yield. 100K invested in this fund will produce about 1K of income a month without selling any stock. And it is a tax efficient fund.. OR if you want money for a big expense you counld invest in grwoth index fund and selll that if you need money for home repair or cart replacement. ut I didn't just use QQQI. I also have SPYI, KGLD, EMO, UTF, UTG, AND PFF. These together generate 5K of income a month without selling. And they all generate qualified ro ROC dividends which are very tax efficient. And each fund having a different risk level. The lower yielding funds have a history of paying a dividend in the worst market year in living memory (2008) while the others have higher risk but very high yield. And I have 4 years of income FXAIX a S&P 500 index fund. And I have a roth and 401K. Yes it does take years build something like this. but the peace of mind of knowing that no mater what happens I can pay my bills and keep food on the table makes it worth the effort.
ETF and mutual funds are designe and share price stay close to each other. Generally the share price tays within a few dollar of he NAV. With a money market fund the NAV and share price are fixed at the value of the dollar. With a CEF the is no mechanism to keep the share price at the NAV. So the share price may trade below or above teh NAV sometimes significantly. But that said most of the dividend comes from selling covered calls. A 20% yield is on the high side of what a covered call fund can do Sinc the share price is currently below the NAV the fund may be losing money with its covere call operation. I generally prefer covered calls funds with a yield of less than 15%. At this yield level most covered call fund make more from the covered calls than they lose. Some good covered call funds I have are QQQI 13$yield, SPYI 11%.These funds don't lose NAV. The NAV is actually increasing and as well as the share price.
You should check out SPYI and the QQQI the latest and greatest in covered call ETFs. Better tax strategies and growth capture
SPYI isn't, diversify regard
You'd need to understand where the distributions come from. Unlike McDonald's, Pepsi, and Coke, which pay dividends from profits, BCAT is a fund that holds a portfolio of companies and sells covered calls on that portfolio, generating premium income (similar to funds like SPYI, JEPI, etc). So you can't quite compare their distributions equally. Second, the price stability is masking a NAV decrease. As the other commenters said, NAV is steadily decreasing even if price is the same or even increasing. CEFs can trade at a discount or premium to NAV, which is unlike most funds. So, if a CEF holds $20B in assets, it could trade as though it were worth $10B or $30B or anything else. If you look on CEFconnect or MorningStar and specifically look at the NAV versus price, you'll see a consistently dropping NAV, which is not good. So, it's essentially a slightly leveraged covered call fund trading at more than it's worth, eating away at its own NAV.
6 months of living expenses in a money market fund Anything more than theat your better off investing it in covered call fund paying a 10% yield Like GPIX and SPYI, or QQQI.
Talking purely dividend returns. From looking at it SPYI avgs about 11% vs Verizon at 5.6%.
What do you think about SPYI. Probably pretty good long term. Idk if your better off in that or spy
Yea but you're not gonna like this... My excuse is I'm in a custody battle with my ex and need income. I have 2000ish shares each of NIHI SPYI QQQI and IWMI. 500ish of BTCI. I'm holding a couple speculative stocks but only 10k per of those I'll keep in hopes of a big payout in 2030. Those are the only things I kept when I switched to income. Before that I was all VOO and chill. There's been some big changes in my life this year.
Question. Does anyone bother with SPYI or QQQI? Basically getting SPY/QQQ, but with high dividends.
My advice to you is don't do options until you have several years of investing knowledge and better understand the risks. Yes you can make income from options but if you do it wrong you could loose a lot of money. You might be better off with fund like SPYI. it invests in the same index as VOO but sells covered calls to cover the price gain into dividned income. They have a professional staff that can do option correctly with little risk to yourself. SPYI has a 12% yield and its dividned income will not be taxed for about 10 years. And they manage to also keep you taxes very low. You will likely pay close to zero tax on the earnings from SPYI for about 9 years. After that the taxes will go up but will still be very well. And using CahatGPT can be risky because tends to make mistakes or will bias its sewer to what you want to hear.
I’m glad it worked out for you. If you are sincere with your question then I will answer it. If I had 100k sitting not being put to work and I was looking to invest it I could employ a couple of different strategies. Passive investing like buying the S&P. High yield dividend income investing like SPYI or QQQI. Or the last, which is what I would do, purchase some quality companies that are trading at a discount and start selling covered calls that are out of the money. The inverse to the last strategy is to identify some beat down quality companies and sell puts on them. There’s a higher rate of return, and if you eventually get assigned, then you implement the wheel strategy.
I think there is a far better wat: Buy a global world ETF. For example SPYI, VWCE or some other simiar ETF which diversifies to the whole world. You will get exposure/diversification to most important currencies. No need to pick a single country. And definitely do not invest only in OMXSPI. It is way too small market and country for wide enough diversification.
Roth and brokerage account have very different rules and can be used in very different ways for different purposes. In my brokerage I have invested in QQQI, SPYI, KGLD, EMO, UTF, UTG, PFF. These provide montlhy dividned that have a tax calsifcation of Qualified or ROC for tax efficiency this portfolio covers all of my livinenexpenses of 5K a month allowed me to retire in my 50s. Now a roth cannot easily be used fro income prior to age 60. So VOO and chill will work. But you might also want to add some QQQI in it so that the dividends will add to your your yearly deposit allowing more than 7.5K a year of cash flowing into the account. The more cash flow into the account the larger it will be when you retire.
6 months. anthyign longer than that would be better off invested in growth index fund or covered call index funds. Whither money market fund or short term treasury fund the best you are going to get is about 4% yield. But with SPYI you can get 11% dividend yield. and it would be tax free income for about9 years. After that the income is taxed at the long term capital gains rate which is still a lower tax rate than your work income.
I’m over 50, single. I work in tech (at an investment bank) and if I lost my job today, I doubt I’ll get back into the workforce quickly, if at all. On top of that, normal medical issues as one ages. I have a years net salary in SGOV and another $15k in a HYSA. Since you mentioned investments, I have a bit over $1m in taxable investments (mostly ETF’s, SPYI produces an income to cover my housing in case anything happens). I should have done better at my age but it’s not the worst situation to be in.
Investing is always the correct choice. If you are worried specifically about monthly expenses instead of growth - Covered call funds like NEOS pay out monthly. Those monthly payouts might drop a bit in a market crash but you don't need to worry about selling stocks to make ends meet as long as you put enough into it. It is 100% better to use traditional etf funds instead of owning covered calls for total return but covered call etf's are a good tool for people who have a major mental block of being adverse to selling in a bad market. CC funds are generally more cash focused than growth focused but some funds have decent appreciatiation with a larger payout than dividend etf's. The more generic and common recommendation is having 6 months to 1 year worth of expenses saved up as cash or cash equivalent. That way market crashes do not mean you need to sell any stocks. Then even in a market dip you are good for the year. But that's normally for retirement. If you are still working, I would error on the side of 6 months. It is enough time to find another job. 240K for sure seems excessive to me but its always based on your monthly budget, not others. If you are budgeting, even if it is high, it is better than most people because you are keeping track. 240K in covered call SPYI = they pay 30K a year which is 2,500 a month you could use or re-invest. SPYI is an investment that grows a bit assuming the market is growing but pays decently. You could be in a coma and this would still be paying enough for most peoples housing and car at least.
The tax come as you describe it only occurs if you sell SPYI. Dividned are taxed 3 ways. ordinary income were 100% of the income is taxable income. Qualified income were worst case only 20% is taxable income it might be 15% or even zero. ROC dividend which has already been discussed. So if your cost basis reaches zero you are still paying less in taxes than your work inocme . 80% less. But if you sell you are pay taxes on the full value of stock you sold. Which is fortunately still taxed at the long term captial gains rate.
Return of capital concept is in many palace in the tax code often not labeled as Return of Capital. When you sell growth you are only taxed on the gains that occurred after you sold. Why? because a portion the income is return of capital. When you sell stock at a loss it is not taxed. Why? became it is all return of captial. Covered call ETF make money form selling covered call contracts. Now sometimes these contracts result in a loss. Good covered call fund seek to balance losses and returns so that you pay minimal taxes due to the balance of losses and gains. SPYI typically generates 95% ROC with the rest bing qualified dividneds. For a covered call fund like SPYI The return captial is subtracted form the cost basis of your shares. which is similar to how capital gains taxes work. If the cost basis is above zero you owe no taxes. Typically it taxes about 9 years for SPPYI cost basis to reach zero. Once the cost basis reaches zero you dividend are taxed at the long term capital gains tax rate. which means worst case only 20% of the income is considered taxable income which is a 80% discount from your work inimcoem Now many will mention 1256 contracts and 60/40 split of long term and shaort term captial gains. But this only apples to fund management not you the investor1256 is an internal part of how Neos handles covered calls but has no bearing on your taxes. Also not all covered call funds generate return of capital JEPQ and JEPI are popular CC funds. But the dividned is taxed as ordinary income. And others may generate ROC and ordinary income to determine how the income is taxed you need to review December 19A or 8937 forms which willl provide tax information. Also be away of funds like yield max that hav more losses than gains. This results in destructive ROC and NAV erosion. generally covered call fund with yields avboe 15% have NAV erosion but but funds with yields below 15% generally Have NAV growth which is good. All Neos funds like SPYI are good without NAV erosion.
you don't have to be growth or dividends. You can do both in one portfolio. In my taxable account I have FAGIX for growth. For dividneds I have QQQI 13% dividned yield, SPYI 11%, KGLD 11%, EMO 8%, UTF 7%, UTG 6% PFF 6%. This portfolio currently generates 5K a month that covers all of my living expenses. I does generate a bit extra about 1K which I reinvest for more income. These dividend funds pay monthly and produce qualified dividned to minimize my taxes. Since i started investing for dividends just before 2020 I have not seen any dividend cuts or any significant problems. Automatic dividend reinvestment is turned off for all these funds so the cash is in a money maker account and I keep a minimum of 6 months in the money market. FAGIX is the market holding with some individual growth stock picks. Otherwise every thing is in ETF or CEF funds. The growth is mainly long term savings for major emergencies or inflation adjustments. And I have 401K mainly growth and roth IRA which is a mix of growth and dividend. But since the Roth is tax free I have other dividend funds that are not tax efficient. Since dividends are very stable I don't worry about the volatility and risk of my growth funds. If I sell growth it is only in the ammount necessary for the emergency or inflation adjustment For example sell 4% of the growth once every 4 years to insure I never run out of growth.
If your investment phiosophy is growth focused many do sell when the market drops. But dividends investors typically don't sell . Growth if very volatile but I'm comparison dividend are typivccallly very stable. I have not seen any any dividned cuts since i started focusing on dividend just before covid started. I have a taxable account that is focused on dividned income it generates 5K a month reliably which I use to cover all of my living expenses. I am currently invested in QQQI 13% yield, SPYI 11%, KGLD 11%
NEVER trade with money you can't afford to lose! After 20-years my job gave me a 1-year severance in 2024, which I then focused heavily on up'ing my trading skills etc., so glad my brother-in-law had got me into trading in 2023! Ultimately I retired early not wanting to compete with other (now 20) to 40+ year old engineers that have been getting laid off as well. I was trading in the upper 60 to mid 70 percentile, as far as win / loss, nothing spectacular (aka worthy of a YouTube channel LOL!) Once I discovered the monthly return ETFs (QQQI, SPYI, JEPI and JEPQ), in my IRA, I went all in, and bless, they're paying my mortgage every month and other bills. I've also added some income ETFs now in my stock account to make cash when I'm not trading, I park those returns into SNSXX (avoiding state taxes) as emergency cash / dry powder for trading. Recently learning of OVI here on Reddit, I'm trying some of that too to see how that does... Good luck w/your investments!
>it's not really ideal for someone in their 20's and 30's Oh, for sure. I hold SPYI and I'm in my 50's. The person I was talking to at work - she's in her 40's so maybe still not quite old enough. I'm just worried that my tech job may not last into the next decade so I decided to take some steps to generate income that covers my mortgage and HOA because at over 50, finding a new job is next in my field may be next to impossible.
1). The monthly income you are getting now will basically be untaxed as they achieved 97% ROC and hence their fees are worth it. 2) Your basis in the stock adjust down accordingly creating a deferred tax time bomb when you have to sell them. After 7 years, the basis is likely 0. Everything from here on out will be long term gains 3) for the 7 year window (QQQI) and 10 for SPYI, it is a chance to cutover from a tax rate say 55% for me into 20% down the road when I no longer plan to work. 4) It's not really ideal for someone in their 20's and 30's kicking the can 7-10 year out and create a bigger tax problem, but perfect for people that plans to work a few more years and kick the can to early retirement (before SS or forced distribution of other deferred comes in. You can't overdo it as income in 2031 even when not working, have SS or forced distribution can still create a problem. Something around 50K in annual income is manageable for tax. 5) I plan to donate them once the basis is 0 to take the tax deductions if it makes sense and contribute to society
This is definitely tempting. I do think SPYI classifies a large part of the yield as ROC, which does not count towards taxable income which could lower MAGI below the threshold.
You have done very well saving but you are imbalanced with all growth and no income. What I would do is sell the 100k and reinvest the money in a high dividned fund, QQQI for example. QQQI has a yield of 13%. So that 100K would generate 13K of income per year and it is a very tax efficient fund so you won't pay a lot in taxes. 600K in high yield funds with a yield of 10% would generate 60K a year of income. So you may watt to start slowly shiting your portfolio away from growth in the taxable account. You could use the money from this fund to pay down your home loan or if needed use the money to cover other expenses. And if you slowly sell of and reinvest the money in the brokerage account in to dividends. you could buildup secondary income sufficient to cover muchof your living expenses. giving you more financial security. In my taxable I have QQQI 13%, SPYI 11%, KGLD 11% EMO 8.5% UTF 7%, utg 6.2% , and PFF 6%. The lower yielding funds are selected based on nong term dividend stability. The other are covered call funds with no NAV erosion. All are tax effect producing mainly qualified or ROC dividends to minimize taxes. For me this protfolio generates 5k a month. Enough to cover all of my living expense.
Note not all dividneds are taxed as ordinary income. Some dividneds are taxed at the the lower tax long term capital gains rate or ROC which is even a bit lower. ROC dividend are even tax free for a period of time (often years) I am invested in QQQI 13% yield, SPYI 11%, KGLD 11%, EMO 8.5%, UTF 7%, UTG 6.2%. QQQI is tax free for 7 years then is taxed at the LTCG rate. SPYI and KGLD are tax free for 9 years and then is taxed at the LTCG rate. The remixing funds on the list are only taxed at the LTCG rate. But they have a much more stable dividend income. I built up all of these funds in a taxable account and I have growth in retirment accounts. Today it covers all of my living expenses in my 50s So I can take a 1 yer trip at any time.
If you are creating income portfolio then diversification is best, so have some in VOO / XEQT and QQQI, SPYI, JEPI, TSPY etc. If you are young and don’t need monthly income then just do index ETF.
I’ve thought for a while that a short term limit or elimination on CG taxes on rental properties would be good for the real estate market. Speaking personally, if we could sell our one rental tax free I probably would and just dump into SPYI. There’s probably a lot of 1-2 property landlords that don’t really want to be landlords.
no. you need to Generate 2 million after tax dollar and put them into JEPQ/SPYI to get decent stress free monthly income. Those income need to check cover your medical bill or any unexpected outcome.
Forget doing CCs yourself. That's just asking for trouble if you're already fucking around with 0DTEs. And looking at your post history is a fucking nightmare at your age. Sell everything and buy SPYI then set it to reinvest dividends while you're still working. Then ignore this account. This will get you 46k one year from now then 52k the next and so on and so on. Hopefully, this a Roth IRA so you don't have RMDs and withdrawals will be tax free. This, plus Social Security, should give you a conservative 80k a year in retirement, not including any other retirement funds. No, you won't be flying around the world in first class but you won't be living off of bread and cans of soup either.
age recomendations are based on the idea that : * Everyone is investing retimrent . * Everyone is aiming for maximum total returns. * Everyone is working and has no need for extra income. * Everyone has the same risk tolerance. These assumptions don't apply to all people, So ther is no-one size rule that works for everyone. The best way to look at this is based on the a count type. If you are using Roth IRA were there are no taxes and you cannot withdrawal the money intuit age 60. These account are great for dividned and gowth at any age if you don't need access to the funds until retirment. 401K and and traditional all IRA also fit in this category. Taxable account can be used for any investments but you need to keep track of taxes. Taxable account are ideal for dividend funds that have high yields and generate ROC or qualified dividends that are taxed at lower rates than interest and work income. I personally have QQQI 13% yeild, and SPYI 11% , EMO 9%, UTF 8% , UTG 6.4% and PFF 6.% in my taxable account. The dividends are all from tax efficient funds and genrate 5K a month of income now which is about equal to my living expenses. and I use the income to maintain a 6 month emergency cas account. And this income allowed me to retire in my 50s. I have a 401K and roth which I will be able to access at 60.
It is still good advice because annoying beyond 6 month of cash should be invested in bond or dividend funds. So If you have enough bond income or dividnedincome to cover all of your living expenses and turn off dividned investing the dividends will refill the cash account. And as long as you spend less than the dividend income you will never run out of cash aNow it does take time to build up a good dividend portfolio but once you have it you could be unemployed for years and still hav income For many people 6 month of cash works out to $30K to 60K. 60K in QQQI a dividend fund with 113% yield will produce 7.8K a year. so yes it will take years to build it up but ingeneratl most people are employed longer than they have been unemployed. So while working it is a good idea to to star this. I have a dividend portfolio of QQQI SPYI 11% yield,EMO 8%, UTF 7%, UTG 6.4%. are tax efficient funds so you won't pay a lot in taxes. And all pay in monthly installments it currently generates enough to cover my 5K amount living expenses.
Keep in mind the age - 100 rule was widely used before retirment accounts existed. So everyone was using taxable brokerages. With no ability to avoid taxes the safe way to minimize taxes was to gradually shift you porfolio from mostly growth to mostly income over time. Now with Roth, IRA, 401K many say stay full invested in stocks and then switch to inocme. Since you can sell at any time and pay no taxed this waite until the last minute aproach will work. But these are strictly retirement rules. which means it is assumed you cannot withdrawal the money until age 60. There are many peoplethatdon't want to wait for incomeuntile age 60. having divined income from your investments can be a type of insurance against unemployment or a medical crysis that prevents you from working for moths to several years. Others want to retire ass soon as possible, gas 30 to 40 or earlier, and that means a taxable account. Others want income for vacation or hobbies. So overall i would not use age as rule defining how you invest. With dividend funds like QQQI 13% yield, SPYI 11% yield, EMO 8%, UTF 7%, UTG 6% and PFF you could get substantial income at any age for any reason and these funds all generate qualified or ROC dividend so they are tax efficient investments and the income is paid out in montly installments.
I just hold SPY or SPYI depnding on how I fee about the market with about this amount, then buy stable stock when they are down or CSP on stocks, still net around 15 to 20k a month or so very little risk as long as you hold if you catch thr downside if a trade.
If 60k is your annual spend, SCHD alone would pay you 72k per year and your taxes would be covered or you’re right on the edge. This means you can mix in tax advantages high yield ETFs like SPYI and QQQI and make over six figures. Your hypothetical is my end game.
Between the two VWCE for sure. Burn my preference for an all world ETF would be SPYI (passive all cap), JRWA (active) or PSWD (value).
I personally prefer dividend investing especially in a taxable account. For taxable account there are no restrictions on the ammount you can invested per year and and you can withdrawal your money at any time with no restrictions other than taxes. So it is best to take advantage of that. It is widely recommended that you have 6 month of cash saved up for emergencies. a money market account in your taxable brokerage is ideal for that. There are money market accounts available with yield comparable to High Yield Savings Accounts iat banks. Then I would start funding a high dividend fund so that the dividned will keep the money market account full at 6 month of living expenses. Dividned are cash profit sharing payments made directly into your brokerage paymentsSPYI 11% yield is a good one with a high tax efficency. Meaning the tax you pay on the dividends will much lower than the tax on your work income. In fact this fund will be close to tax free for about 9 years. After that you owe tax every year but still at a rate lower than work inocme. Turn of automatic dividned investments. That way the monthly dividend payments will go directly into your money market account. If you have more than 6 months of cash you can invest the excess into VOO and VFX if you want ore reinvest for moredividned income. 50K invest in SPYI willl generate $$5.5K a year. So now you have a taxable account that will generate cash that can be used to cover your Roth IRA payments or use to pay montly utility bills another regular expenses So eventually the dividend income could cover all of your investments and some or all of your living expenses. This effetely means you won't have to use your hard earned work income to save for retirment. I realized this lay in life but I was able to build up enough dividned income to cover a;; pf my living expenses and retired at 55.
No sweat…Covered calls aren’t the move. Take a look at options premiums. If a premium is $1 and the share price is $50, selling that call will protect against 2% of downside. They really work best in flat periods, but you have no way of predicting those. SPYI’s periods of outperformance will not make up for its periods of underperformance over time. Defensive sectors have lower downside risk in exchange for much lower growth and pay 2.5%. XLP, XLU, XLV. SCHD is heavily defensive and pays 3.5%. You could try buying those opportunistically while DCAing your more speculative moves. Defensives and SCHD have a lower likelihood of margin call than SPYI, and are a large part of my strategy of interest/dividend neutrality in my margin account. .
Ei kyllä se olet sinä kenellä luetunymmärtäminen tökkii, mitä kohtaa sanoista "hommaa töitä" et ymmärtänyt? Jos nyt tosissaan haluat neuvoa, niin avatkaa Nordnet arvo-osuustili ja siellä ETF-kuukausisäästösopimuksella ajallisesti hajauttaen esim. 500 €/kk [SPYI](https://www.nordnet.fi/etf/lista/spdr-msci-acwi-imi-spyi-xeta) ETF:ään. Ja sen jälkeen hommaa töitä. Jos haluat lisää neuvoja, niin r/Omatalous on suomalainen taloussubi. Sieltä vaan kyselemään apua, tietävät Suomen lait ja rahastot paremmin. Mutta neuvovat samaa kun minä, hommaa töitä ja laita rahat SPYI:hin.
SGOV is basically the same as a Money market fund or HYSA. I would rather deposit money into a high yeild fund like QQQI 13% yield. and turnoff dividend reinvestment and and led the dividned fill a money market account. build that up to 5 most of cash Anything more than 6 month would be reinvested for more dividend income Eventually the dividned income may be enough to allow you to start funding the Roth. So now you have dividends funding your Roth and keeping your emergency fund full. Eventually you could start using the dividned income to also start covering some of your monthly bills. Which would indirectly allow you to increase your 401K invsitment. Eventually I added other dividned funds like SPYI 11% yield. EMO 9%, UTF 7%, UTG 6% and PFFD 6%. All these funds are taxed at ta lower rate than your work income and they pay montly dividends. My taxable account now generates enough inome to cover all of my living expenses. it won't fix your problems overnight. It take time to build up the divine income . And the more income you have the easier it is to invest for retirment.
The fear and anxiety are from not knowing what to do and worry that the share price will suddenly move and you loose. You might be better off with dividned investing. Dividend are cash profit sharing payment directly to your brokerage acount. Dividned funds and stocks tend to smaller and less frequently price swings than growth stocks. And the dividend payments that occur montly or quarterly can be substantial if you have a lot of money. With dividend you will make a yearly profit without selling the share. All you have to do it simply hold them in a brokerage account. You could sell them but before you do work with a tax professional to dertermine The tax you will owe and then make sure the taxes are paid. Once taxes are paid you could reinvest them back into the same stocks. But I would recoment investing the money in another fund Such as SPYI 11% yeild, EMO 9%, UTF 7% UTG 6.4% and or PFFD 6%. All these funds pay cash profit sharing payments directly into your brokerage account. At that point you can either spend the cash or reinvest it for more dividends income or invest the dividneds into growth index funds or into a Roth account to save for retirment.
So many of you have told the OP to buy and hold, then sell sometime in the future, after appreciation. You're missing a key point: the OP is looking for some immediate or near-term income - there's a sh\*#load of frustration and impatience in that post. The other thing y'all aren't hearing is that the OP seems to be stuck in a 'no/low risk but high reward' mindset. The OP mentioned having a bond fund/funds. That tells me real risk aversion. So the OP needs to relax a little AND be rewarded with seeing tangible portfolio increases in the Roth, my guess within the next 6 mnth or a year, before he/she jumps off a cliff. I'm going to suggest baby steps for this OP. If it isn't like this already within the Roth, change it to: 1/4 Bond of something like SGOV, for security, 1/4 Growth like VOO (which will be realllllly tough for the OP to have faith in, this can take years in a flat market), 1/4 in a middle-of the road ETF like SCHD, and 1/4 in covered call ETFs, like QQQI and SPYI. << That last one is where the instant gratification is. Further, you all are wrong to say ETFs don't appreciate. I'm looking at my Schwab now and I have some covered call funds - SPYI, for example - that has a 38% appreciation in less than 2 years, PLUS the 10%+ yield. The worst performer I've had (which I sold a few years ago) was JEPI. I have ETV, which gives me a solid 7% yield with only 12% appreciation in 2 years, but I keep it because it is tax-advantageous, somthing the OP doesn't need to worry about. I also have GPIQ and NIHI, among others. I'm trying to post a screenshot of a partial view of my portfolio on here but I can't seem to do so. All in all, I don't believe that over the long term the OP needs a big covered call portfolio. But to kick start their psyche, yes, it's a good move.
But then what about portfolio diversity ? NEOS and SPYI for me too
ETFs are guaranteed = look at NEOS QQQI SPYI MLPI they play cash monthly around 12% annual plus. Modest expected appreciation. That’s 15% in my ROTH as I’m 85
Back during the pandemic, I got all in with the euphoria (i.e. ARK Funds) and got left holding the bag. Today, I'm trying to be patient and waiting for a significant drop before redeploying more for long term (SPCX, CBRS, even MSFT). Instead of building positions on single company stocks, been just dabbling in on dividend income funds such as SPYI, QQQI, PFFA, and MLPI that will have less volatility once the dip happens while still building income for this potential dip.
different tools for different uses. SPYI underperforms SPY in a bull market and has higher fees, but during a flat market like we are entering it will do well, even a bear market it will drop (slightly) less than SPY. Also for those of us with this in our regular account and looking for a monthly income stream, most of its dividend is ROC which means no tax (huge advantage). In a raging bull market, yeah you better off just put it in SPY. But I believe we are past that now, and will be flat in the next 6-12 months before the inevitable ai bubble crash, which will be spectacular. Watch the 10 year treasury yield and open ai infrastructure spend, the money will dry up, then everything comes crashing down.
If you have been investing for 25 years your are like 50 years old. Which means your subconious financial goals are changing form growth to capital preservation and income. I would look at investing in these funds JAAA 5.5% yield CLOZ 8%, UTF 7%, UTG 6.4% and ARDC 9%, FAGIX 6% UTF and UTG survived 2008 with no dividned cuts While JAAA and CLOZ and didn't exist the investments they invest in continued to pay out income when the market crashed. FAGIX if a 40 year old bond fund that has always payed a dividend. ARDC is only 15 years old but it has a very stable dividend. i have these funds in my roth and have QQQI 13% yield, SPYI 11%, PBDC 9%, EMO 9%, Right now my roth has 500K invested and generates about 5K a month which is all reinvested. IIt will be few years beforeI can access this income.
You could get overexposed to gold. But the bigger problem is you you're putting money into an asset that may never pay off for you. Gold has tendency to stagnate for long periods of time. And then for a short period of time shoot up and then quickly drops. Many miss these peaks and either sell at a much lower price or don't end up selling it. I could instead invest in IGLD. IGLD sells covered alls based on gold price. this fund Basically converts gold price volatility into steady income. Overall it will generate 10% yield of 10%This would be 1K a year for 10K investment. Note the yield is currently higher right now because here was a large special dividend recently. Eventually the yield will drop to its historical normal level. Ther are many funds you could invest in for income which generally is better invesmtnte than a shiny metal. Such as QQQI 13% yield SPYI 11%, EMO 9%, UTF 7%.
Overall the plan looks sound. But I would consider putting the money invest the 240K in SPYI 12% yield. That would generate about 25K a year of income per year which would be tax free fro 9 years. After 9 years you will owe taxes on the dividend income but it will be taxed at the long term capital gains tax rate which is significantly lower than the tax on her work income tax rate. This money could be used fund a Roth IRA in addition to her 401k. and it could be used to maintain a 6 month emergency fund and compensate for the loss of income due to the 401K set to maximum. The maximum deposit ammount for a 401K s bout 23K a year. So worst case the dividend income could cover the loss of income due to the 401k. But the 401K also lower her taxable income so the tax savings may be enough to compensate the lost income due to the 401k. And any excess income could also be invested in growth or more dividend funds such as EMO 9% yield, UTF 7%, UTG 6.4%. These funds have a lower yields but the maintain the lower tax rate and have longer history of paying dividend. Using this taxable brokerage account to generate more income could eventually allow her to retire in her 50s. Also 25K of passive income payed in monthly installments is a much more flexible emergency fund. a cash emergency fund will eventually run out of money when you need it most. But the passive income from dividend is continues and won't stop.
There is no advantage of owning MSTR over SPYI. MSTR is dogshit wrapped in catshit company going into a deathspiral rather sooner than later. Paying 12% of interest on debt while the going rates are much lower is telling for any investor with some experience.
And most importantly IMO is what the goal of the portfolio is: is it capital preservation? Is it for hedging equities? Is it maximizing yield? Is it hedging liabilities? Like if you’re just preserving capital or maxing yield, it’s “easy” to just stick the capital into a fund with that motif. But say you have future liabilities you’d want to duration match a custom portfolio. Sidenote: in a way it seems like bonds are antiquated in a way from an investment standpoint in the way OP seems to think about return, in comparison to something like JEPI or SPYI. That return income and equity exposure.
SPYI, QYLD, etc. are also hot flaming garbage
Save the headache. Buy SPYI when it dips and collect/reinvest the monthly dividend and enjoy life. I'm trying to set alerts and get away from staring at charts.
I plan to convert everything to SPYI and live on the 12% distribution paid monthly.
I have an inherited IRA that I split between SPYI and QQQI. I get around $4,000/mo before taxes. Growth has exceeded the dividends so far so there’s been no NAV erosion. Since this was basically found money, I wanted to test this as an income stream strategy for retirement. I don’t have any complaints so far.
If nothing else get into something like JEPI, JEPQ, SPYI, QQQI and start accumulating dividends while you wait.
buy SPYI and QQQI and go sit on a beach with 10k per month in dividends. Peace out world.
My biggest worry is that one day QQQI (or JEPI or JEPQ or SPYI) will suddenly say: that's it, we're out of shares. So, no more dividends for you! 😃
You okay with less returns but more stable then go with SPYI.
As a student one is always in need of money until after getting a well paid job. SPYI is high interest SP stocks that offer high interest. There is some appreciation also when the sp market goes up. Except a couple dips it is relatively safe. It is meant for income that pays you monthly. The portfolio consists all famous top companies doing covered calls.
If you're over 50, do you want income from it? Do you wanna make sure to preserve capital? If you want income the CSPs and CCs are still a strategy to do that, but an easier route would be to put some in income focused ETFs. QQQI, SPYI, JEPI, JEPQ, SCHD are some of the popular ones. I am not a financial planner, so you'd want to consult one probably. Im just a guy a couple years away from retirement who has been looking into some of this stuff and running different scenarios/strategies through spreadsheets. There are tax implications on some of these things that I dont fully understand yet so talk to somebody that knows what they are talking about. Some of the returns on income ETFs are considered qualified dividends, some arent, some are considered return of capital. Etc. Way too much to get into here, but if anything Im saying is completely foreign to you they are things to go do some research. Or just get a financial planner. Which is probably the best advice
I'm not familiar with SPYI's distributions so no comment on that, but yes turn off the automatic reinvestment.
If you don’t rebuy more SPYI then a wash sale won’t be triggered. You can sell all the long term breakeven lots plus an equal number of gains and losses which cancel out.
Sell it all in the IRA for sure, then look at the tax lots of what you hold in the investment account and sell anything breakeven or losing that doesn't trigger a wash sale. Then put what you get in VOO or whatever you want. In the future look for any opportunities where it makes sense to sell some or all the remaining SPYI.
I’d sell SPYI in your IRA and buy VOO and some VXUS or another international fund. I’d avoid realizing gains in your taxable account, if possible. Just put new contributions towards the vanguard ETFs
You can just about do that now in 50% QQQI, 30% SPYI, 20% BTCI. As for how sustainable that is. 🤷
Probably QQQI and SPYI.
Picked up some SPYI and QQQI