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Evaluation of £UTG (Unite Group Plc). Student REIT. Thoughts?
A good defensive holding- Reaves Utility Income- $UTG- 7% dividend
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For retirement retires need income and dividned income is a lot safer for retirment than selling shares for income (the 4% rule) When you sell shares sequence of return risk and inflation risk that can rapidly deplete a retirment portfolio which can cause one to run out of money before they die. But other than retirement the young can also benifte from dividend investing in taxable brokerage account. For many people once they pay there monthly bills by food and gas for the car and amy maintnenca needed they have almost nothing left. IF they invest a little bit every month in tax efficient funds Like SPYI 11% yield IAUI 11%, EMO 9%, UTF 7%, and UTG 6.4% and PFFF 6%they can over time build the passive dividned income to a point were they can start to pay bills and expenses with dividends instead of work inocme . And if they suddenly loose there job the dividend income could be invaluable in covering expenses until you find a new job. Also if you want to retire before age 50 you need to have Taxable brokerage account to cover to retirment to age 60. After age 60 you can use retirement accounts. Additionally IRA and Roth IRA you are limited to maximum yearly depoist if $7500 year.. IF you could magically increase that to 15K per year your saving will be at least 2 times higher when you retire. Dividends don't count as a deposit so you can earn as much dividends as you want in the IRA or Roth and still deposit $7500 a year. you can also use dividend income in a taxable account to insure you always have $7500 available to deposit into the accounts. In my opinion anyone with more than 100K sitting in High yield savings account should invest that in dividned funds. The interest from high yield savings account is only enough to keep up with inflation. With dividend funds you can easily earn 2 times the current inflation rate.
To get high yields and high liquidity means you need at minimum 2 funds. You also need to consider taxes because not all dividend funds are taxed a the same rate. And to have access to the money at any time it needs to be a taxable account. * At least one high dividend fund * A money market fund Basically you use the yield of the dividend fund to feed money into the money market fund. This means automatic dividend reinvestment is set to off. The dividends are gernerally not reinvested. But instead a portion is reinvested and the rest stays in the money market fund. So set a maximum limit on the cash level in the money market fund. 6 months of living expenses is a good level. If the money market fund exceeds 6 months of cash reinvest the excess into the dividned fund. A good dividend fund to shart out with is a quality covered call fund. Quality funds generally pay around 10% or a little higher or lower Say 8 to 13%. Some favorite are QQQI 13%, SPYI 11%, IAUI 11%, GPIX 8%, and GPIQ 10%. All of these fund generate about 90% ROC dividend that makes them very tax efficient. These funds are similar to growth index funds but the covered call strategy coverts the growth to income. The GP funds target more growth and lower dividned, While the NEOS funds (QQQI and SPYI) target more dividends and less but still positive growth. So the price of these funds will move up and down with the index they follow but have less growth and more dividend. IAUI (a NEOS fund is a bit different it follow the price of gold. You also want a maximum investment limit to the growth fund. You don't want to have all your money invested d in the same way You want to eventually have multiple funds generating income and feeding that into the money market acount. That way if you sector of the market has problems you still have income from other sectors of the market. This insures money will always flow in the money market account. So evernualy you will have multiple dividend funds and one high yield money market accounts. I started out the SPYI and QQQI in my fidelity acount. Now I also have UTF 7%, UTG 6.4% NAC 7%, PFFD 6% all feeding money into my money market account with 6 month cash reserve and montly dividend income feeding it. I also have a growth index fund in this account as a form of emergency saving with currently 4 times my living expenses. The dividned funds currently produce all of my living expenses in 1 year. This allowed me to retire in my 50s. But this type of account isn't just for the old. The young can and should start one as well as a standard retirement fund in Roth or 401K.
Real estate involves a lot of expenses, mortgage, taxes, repairs. There is a way to generate income from market investments that doesn't involve selling stock or the expenses of real estate. Most investors today focus on share price growth in there investment accounts. There are stock and Fund that pay Dividneds. Dividends are cash profit sharing cash payments directly in your brokerage account. Now many growth index funds pay a dividend of about 1%. A dividend investor targets higher yields Typically 1% to 10%. Instead of investing in individual stocks you invest in dividend ETF. I am retired and living off of dividend income of 5k a month. I am not selling stock for this income. Since you want the money now and not in retirement you need other use a taxable account. And since dividends generate taxable income we need to invest in things that are taxed at a lower rate. Some good funds to use are QQQI 13% yield, SPYI 11%, IAUI 11% EMO 9% UTF 7%, UTG 6.4%. 100K invested in fund with a yield of 10% will produce 10K a year of income. And all of these make monthly payments. The three funds with the highest yied will be taxed at close to 0% for 7 years for QQQI and sPYI and IAUI are zero for 9 years. The other two will generate tax every year but at a very low rate. Generally you want to avoid using one fund for all of your income. Simply because if one fund develops issues you will still have others generating income. Now I also hive dividned funds in my Roth because they they are taxed at the work income tax rate. Putting dividends in a roth is a great way to to avoid taxes in retirment. My roth has all of the above funds listd plus AARDC 9%, PBDC 9%, CLOZ 8%, PFFR 8%, and JAAA 5.5% and FAGIX 5%. The dividend funds in my roth are generating 5k a month right now.whichis all reinvested right now.
With a growth index fund most of the gowth in the first 15years comes from your money deposit into 401k or Roth. There is a limit to hw much ou deposit. and that deposit limit limits the size of the account. Growth index funds don't include BDCs or MLPs businesses. Even VTI which is advertises as the total US stock market doesn't have them. SO You can add PBDC 9% yield, and EMO 9%. And these com\[panies are required to pay ou most of there income as dividends. So the yield is higher than most stock that are not required to pay dividends. If you include these funds in your portfolio the reliable dividend from these companes will continue to come in and you can use the income to add to other funds in your portfolio. In addition debt opbligations such as credit fund, CLO fundsare not stocks but funds investing in these assets also pay very good yield So i also hav ARDC 9%, CLOZ 8%, and JAAA 5.5%. Utility and infrastructure funds are also stable dividend fund and I have UTF 7% yield and UTG 6.4%.
To retire early you don't want to use an account that has restriction the ammount you can deposit and no restriction on when you can withdraw money. Which means you probably want to use a taxable brokerage account. With no restrictions on deposits, withdraws and investment options you can do a lot in a taxable account * Now as to investments you could use growth index funds * Or your do dividend investing. * Or you can do a mix of growth and dividends. then set up an automatic transfer from you bank account to your invesment account with and use automatic reoccurring investments to pu the money in the funds you want. With all this occurring automatically all you have to worry about is work and making money. For a taxable brokerage I mostly focus on dividends. Using funds like SPYI 11% yield, EMO 9%, UTF 7%, UTG 6.4%, PFF 6. Reasonably tax efficient funds that eventually can can generate passive income. And once you get about 1 to 2K of income a month you can start using that money to cover routine bills and expenses. And when you cover bills with investment income work income could be spent on more productive things like investing more, vacations, hobbies. I was a growth investor for about25 years. then started investing for dividend in my taxable account and at 55 retired with 5K of income prior to starting dividend investing I was expecting to retire in at age 65.
Many growth investors have large cash buffers to survive 1 or 2 years or more to supply money during market down turns so they can avoid selling shares at a loss. Many dividend investors don't have large cash buffers. Instead they build adeversified portfolio of dividend payers that reliably pay dividneds through stock market crashes. Every year theS&P500 pays about 1.2% dividned yield. Index funds have payed though all market crashes yes the dividend may drop a little bit but not much. In most recessions the dividend drop is about2% while means 98% of the total dividend is still payed out in market crashes. Yes dividned cuts do occur but they are not common.. So some investors may not see one in ther life big enough o effect them. And with dividend ETF today ou can have a fund with 400 stocks paying a 6% yield and you might never notice the one stock int he portfolio that cut its dividned. UTG is a CEF that pays 6.4% in monthly installments. it has never had a divided cut in 20 years and it has gradually increase the dividend over time.
well with 500K you could invest that in a dividned fund with a yield of 8%. That would genrate 40K a year about the same as rental produces. QQQI has the highest safe yield I know of QQQI That would generate 65K a years. for 6 years that income would be tax free but after that the income would be taxed at teh long term capital gains rate which is still less than the regular income tax rate. Overall in your case is it about a wash . You could do slightly better but dividend or wrose. yield higher than 13% are available but the risk with those funds are very high Now with dividends you don't need home insurance and spend money on repairs, or property taxes. So you might save a lot on expenses for your rental income to make dividnedincome a better choice. But that woudldepnsd on very close examination of your accounts. Which is probably more information than you want tot share. IN any case some tax efficient fund you can use in a brokerage account for supplemental income are * QQQI 13% yields. * SPYI 11% * IAUI 11% * EMO 9% * UTF 7% * UTG 6.4% * PFF 6%. You best choice is probably keep you rentals and gradually invest in the above funds to build up additional income in addition to your rental properties. You could gradually increase the dividned income and use the money to just cover living expenses and regular montyhly bills. Also it is generally not to rely on just a couple of dividnend funds for income is at least 5 or more.
IN my root I am investing in my Roth in QQQI 13% yield, ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, pFFR 8%, UTF 7%, UTG 6.4% JAAA 5.5%. This would generate substatial income..
With investments you often can ignore them for weeks. With real eaistate get calls about maintenance issues. and you have to take care of taxes. And if you used alone to buy the property that lan reduces your earnings. Real estate is not an investmetnyou can ignore. Now you could with your 80k invest in QQQI and get $11,200 cash dividends per year and from my own experience with this fund you can ignore it and let the cash dividend build up or you can have it automatically reinvested. And you don't pay a lot of tax on the dividends you recieve. So this fund could be in taxable acount earning you money right now. And if you buy more shares with your own keney re reinvest the dividends you could in about 5 years have about 200K invest in the stock with an income of of about 2K a mont. i have investment in QQQI 13% yield, PBDC 9%, UTF 7%, UTG 6.4% and PFFD 6% and NAC 7%. overall I am getting about 5K a month of inomce form my taxable account. It allowed me to retire at 55 much earlier than expected.
If you invest in yield of 10% your money will double according to the rules of 72 /10 =7.2years. If we reduce the yield to 7% the money will double in about 10 year. You can use funds like EMO 9%, PBDCV 9%, ARDC 9%, CLOZ 8% PFFR 8%, UTF 7%, UTG 6.4% QQQI 13%, and SPYI 11%. 2 of these funds are over 20years old. 2 are about 15years. old and are CDF funds. ETF are relatively new. and the reminder are much younger but but the assets they invest in aaremuch more oldeirand pay a dividend consistently.
Sell FEPI it has serious NAV erosion issues. NAV erosion causes the star price to drop and prevent share price grwoth. As the star price drops you loose your initialinvestment. Also the dividned payout drops with the share price drop. Eventually you loosely of your initali nvesmtne and your dividned income but the NAV erosion keeps the calculated yield high. And CHPY is also at high risk for NAV erosion. The only reason why CHPY does currently have NAV version is due the AI crating a lot of chip demand. Once the AI bubble pops CHPY will have NAV erosion. on The other problem you have is you are overly reliant on covered calls funds. You could sell MLPI and instead invest in EMO with a yeild of 9%, you could also add PBDC 9%, ARDC 9%, CLOZ 8%, PFFR 8%, UTF 7%, UTG 6.4%, JAAA 5.5%, FAGIX 5%. substantial yields without covered calls. And since it is in a IRA no taxes on the income.
the 6 month emergency cash fund is just the start of what people should do when they get to 100K. Anything in excess of the 6 month emergency cash fund should be invested. In a taxable accout so that you would have more investments you could use for income if you loose your job or have to stop working due to medical issues. Additionally you want a return of about 6% to insure you money grows faster than inflation. there are three basic choices. 1. invest in grwoth index funds just like people do in retirement accounts. There is low tax impact in a taxable account. But you would have to sell stock when you need the money and you might end up selling at a loss. Also if you permenently cannot work your money would run out. 2. Investing bond funds these would produce cash monthly which can be used to cover expense indefinitely if you cannot work. This income could leas the rest of your life but the yield of bonds is in general every close to the inflation rate. Also you pay taxes on the bond income every year. 3. The remaining option is to to invest for dividends. Like bonds they produce cash income. Like bond dividend investing can produce cash for the rest of your life. But unlike bonds you can get yields of 1% to 10%. And surprisingly a dividend fund of 10% yield has no more risk than a growth index fund with average yearly yield of about 10% like S&P500 grwoth index funds. Many people use methods #1.However method #2 and #3 have the benefit that you in that you can gradually increase your income without changing jobs or working more hours. Potentially allowing you to retire beforeage 50 or even earlier. And if you don't need the income for an emergency you can use it to fund a Roth account or pay regular utility bills or even you home mortgage. For my self I chose #3 Some very safe dividned fund are JAAA 5.5% yield, UTG 6.4%, UF+TF 7%, and CLOZ 8%. Some less safe funds I also use are ARDC 9%, PBDC 9%, and EMO 9%. With yield like this you can generate substantial income. With teh funds I have listed 100K invested could genrate about 8K a year. Build that up to 200K you are up to 16K. A little more tha n 1K a month of income. i retired at 55 with 5K a month from from my investments in taxable brokerage account. I could have done this in my late 40s but didn't know much about dividends at time. Additionally not all dividneds are taxed the same so with careful fund selection you can potentially lower the tax on the income you get substantially. Sometimes close to zero.
I actually took the opposite approach and added 4K shares of AMLP. Back in 2020 when demand collapsed the price fell into the low $20s, but it’s recovered with the rebound in energy activity and is now around the $50 range. It also traded near $90 back in 2014, so I expect it to rise to those levels as demand increases. What I like about AMLP is that it holds pipeline and midstream infrastructure companies rather than pure oil producers, so they get paid largely based on volume moving through the system. On top of that it’s paying roughly a 7.5%+ quarterly yield and distributions have been increasing. So for me it’s not just a price but also an income position that pays me to wait while energy demand stays strong. I am heavy into BUI, UTG, ENB, UTF and they are killing it since 2020. If they drop, it would only allow me to grab more.
Interest rates are based on what the government bonds pay. However dividend funds you can get fixed rates of of 5% on up to about 10%. For example in my roth account I only invest for dividends from the these funds: QQQI 13% yield, EIC 11% , ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7% UTG 6.4%, JAAA 5.5%. FAGIX 5%. With dividend funds you can lock any rate you want. Not a fund can cut or reduce e the dividend due to bad economic conditions but these are rare. With UTF, UTG, FAGIX, ARDC these funds have been paying stable dividend for decades.
As people are their risk tolerance tends to decline nothing wrong with dividend investing at your age. Now government bonds ar the preferred route for many people because the government always pays. But the yield are always small and barely keep up with inflation. If you invest in dividend funds that don't invest in government bonds you ca get higher yields Now I live in the US and don't know anything about your taxes or investment options but for myself I like diviend dinvestings. And JAAA 5.5% yield, UTG 6.4%, UTF 7% and CLOZ 8% all pay more than the long term inflation rate and they are hghly reliable payer. UTG and UTF both have 20 years of no dividend cuts. FCLOZ and JAAA don''t have a long history but the asset they invest in CLOs is a very low risk Asset. So in any recession these should pay out dividend. I also have AADC9% yield about 15 years of history and the dividend is very stable, EMO 9% and PBDC 9%. They have more risk but still reasonably reliable dividend. and the best part is none of these funds are covered call funds. And non have nave erosion. As to covered call funds I have some but NEOs fund like QQQI and SPYI and GIX and GPIQ are all covered call funds with no nav erosion. Nav erosion is normal for any wlell runs dividned fund. NAV Erosion typically occurs in fund that are not well managed or are paying out a dividend higher than covered calls can reliably generate. The covered call fund I have mention have been intentionally setup to pay lower yield and many other covered call funds that have NAV erosion. but with Yield of 8 to 13% they still earn a lot more than the inflation rate. Now with the higher yield from funds like that you can generate more income from less invested. But like I said earlier I don't know what funds are available to your or or the tax laws you have to deal with.
Out of $RITM, going full-on defensive: $UTF, $UTG, $BUI, with $ARDC & $PFFA for some extra risk/return. As far as penny stocks go, $BBDO & $AVAL have my attention, both dividend-paying Latin American financial institutions. I’ve been watching for a while so I think I’ll average in over time. Also $AVUV is a small-cap ETF, that’s also just absolutely ripping today, that also pays a little dividend. It’s not a penny stock but it sure beats holding bags of who knows what you jumped into…🤙 I wish I had bought more AVUV but I will not free-base cocaine. I won’t do it!
when the market is down bond will still be generating cash you can use to invest or you can live of the cash generated When there is bull market nothing has higher returns than goth. This is has been true for 100 years. investments that generate cash (Bods or dividends) The problem with bonds is that they have such a low yield that they don't really keep up with inflation. But if buy corperate bonds you can get a yield tier than government bonds but there is a risk a bond can go into default. And dividends can be reduce or cut but you can get dividend fund that have yield of 5 to 10% The trick is to select funds that pay more than the inflation rate and don't have more risk than you can tolerate. I have JAAA 5.5%yield in my roth along with CLO 8%, UTF 7% UTG 6.4%, ARDC 9%, and EmO 9%. UTF and UTG have 20 year histories of paying dividends without dividned cuts.
Dividend investors invest in fund like JAAA 5.5% yield, UTG 604% yield, UTF 7% yield, CLOZ 8% yield, EMO 9%, PVDC 9%, ARDC 9%, and QQQI 13%. these yield are much higher than the government and banks are offering. The higher the yield the lower the share price growth. the higher the growth the lower the dividend But higher grwoth tend to come with a lot of share price volatility. high dividend funds often have less price volatility. Now for dividned investors they prefer to buy and hold a dividend fund for a long time. and just collect the dividends generated. Now you can reinvest the dividend back into the fund to gradually increase the dividend or you can simply use the dividned to cover living expenses. Tax are owed on the dividend when you relieve it just like interest from a bank. But not all dividend funds are taxed the same some have qualified dividend which are taxed at a lower rate ROC dividend are not taxed for years but then they are taxed at the qualified tax rate and some government bonds and municipal bond funds are also tax free. Sp ot os possible to to avoid significant ammount of dividned taxes. Now if you only want o the invest the money in a dividend fund for a year and then withdrawal all the money you have to sell shares of the fund on the open market and if the market crashes before you sell you might sell at a loss regardless of how much dividned you received. So for dividned investor you select solid fund and hold as long as they stay good. Some stay god for many decades. Others are simply bad investments. All the finds I have listed above are good solid investments. QQQI is the most tax efficient fund however some of the other are taxed at the same rate as work income. and other will be somewhere inbetween. I am retired and my dividend income from a taxable account over all of my living expenses about 5K a month. When my roth becomes available I will double my dividned income and all the Roth dividend income will be tax free.
HYSA and government bonds don't keep up with inflation once you factor in inflation your total return goes from3.5% to very close to zero or even negative 1%. My Roth currently has about 500K in it and it is invested in QQQI 13% dividend Yield, ARDC 9%, BPDC 9%, EMO 9% CLOZ 8%, UTF 7%, UTG 6.5% and JAAA 5.5% yield. with funds like these you can easily get 8% on your 500K which would generate 40K per year of income. Which is enough income to cover most monthly bills and expense people have per month. You do have to pay taxes on the income but if all you have 40K you would in the US owe about 1K in taxes. IF you use tax efficient fund you could get the tax down to zero.
The big problem with government bonds is tha they barely keep up with inflation. A bond yielding 3% is very safe but if inflation i running 4% per year your effective total return is on -1%. This means you need to look for yield higher than the rate of inflation. I generally I prefer to aim for a yield 6% which is about 2times the long term average inflation rate. You probably aren't going to find government bond with that yield.But you can get corperate bonds yielding 5 to 7% and some muniboxnd funds with yields this high. There are Collateral loan obligations funds JAAA 5.5% yield invest in AAA rated CLOs which in thee 30 years this asset has been availalable there have been no defaults. CLOZ 8% yield invest in BBB rated CLOs which have only a 1% default rate. UTF 7% and UTG 6.4% both invest in utilities and infrastructure. Both have a long histiory of reliable dividned payments. ARDC is credit funds 9% yield. again a long history of paying dividends and no significant yield cuts in its history. PBDC 9% yield and EMO 9% are invested in businesses that are required by law to pay out some of their profit as dividend yield. As a result the yields are higher than most stocks that don't have any legal requirement to pay a dividend. Investing in funds like this can get you a higher total return especially if you reinvest the dividends than government bonds with a yield well above inflation. Now nothing will do better than growth in a bull market but most of the funds I have listed that did exist in 2008 wen the market returned about -40% all payed the dividend And for those funds I have listed that didn't exist in 2008 most of the assets they invest in did very we'll and thy silll payed yield. And with funds like these you can get more income than you can get with bonds.
I've thought about this a bit, and I kind of have a different take than most comments here. I like the idea of investing in businesses that can raise their rates to track with inflation. The problem with many standard businesses is that in tandem with inflation there will likely also be reduced consumer spending. And obviously that will lead to lower sales and less income, even if prices are being raised, which means the stock (and entire market) may drop a bit. So my answer has been to go into utility infrastructure funds. Regardless of what happens in the economy, I figure everyone will continue using utilities, so that is a pretty safe sector. And those companies can (and do) raise their rates regularly. I like UTF and UTG, which have the added bonus of paying out healthy dividends.
>What about infrastructure software? Waste management? Insurance services that collect fees regardless of market direction? >I keep coming back to businesses that are essentially toll booths - they collect a cut of transactions that happen There are specifically companes that are required by law to pay out most other income as dividends. MLPs companies move oil and gas through pipelines and BDC that loan money to companies. As result of the laws that they must follow they pay higher yields than many other companies. For BDCs I have a ETF PBDC 9% yield and for MLPs I have EMO 9% yield. And there are companies that deal with infrastructure I have 2 such funds I like UTF 7% and UTG 6.4% yield. And we all have to deal with home loans business with buisness loans. These loans are often sold as loan obligations. so when the loan if payment is made most of the money goes to the people that own the loan obligations. I have two C collateral Loan obligation funds JAAA 5.5% and CLOZ 8%. I also have a general credit fund ARDC 9%. All of these funds are consistant dividend payers.
I’ve been living off dividends since retiring 2 years ago. Primarily I use CEF’s. BST and UTG are 2 of my favorites. I do have a small amount in a CC etf for a small income booster.
I said seldom not never. UTG is only something like a 1.2x fund, so barely even qualifies as "leveraged".
Why only hold a leveraged fund for only one year?. UTG uses a moderate level of leverage. Yet for its 20 year history has produced a stable dividend with with a bit of dividend growth. A great investment in any type of account.
IN the current market it is probably best to invest in some dividned funds or bond funds. The market could crash and the value of your investments would drop but the dividends keep coming in. Dividend ar the investment version of invterest. If you took your 150K of cash and invested it in taxable brokerage accountant deposited it in QQQI 13% yield you would get 1.5K per month. As people get older they get uncomfortable with the risk of growth index funds. So for you it is time to change your nesting stratagy for dividend income The only difference between QQQI and your vangard cash money market account is that you would have to sell QQQI to get your full 150K back you would need to sell QQQI. If the market is up you will likely get some captial gains. But if the market is down you have a captial lose. While QQQI has a nice high yield in a market crash there is a good chance the yield will drop and it may take years to recover. So many use bonds instead of dividned fund but those are paying about 3.5% righ now. However there are some very safe dividend [funds.you](http://funds.you) could use, JAAA 5.5% yield, UTG 6.4% yield, UTF 7% yield, and CLOZ 8%yield. These are about as safe as you can get 6.7% yield you have an equal amount of money in each fund. 800K invested in at 6.7% you generate 53,600 per year or about $4466 per month. Now with this portfolio if the market crashes the value of each fund will drop but you will continue to get your 6.7% yield and 4466 per month. So as long as you just collect the dividneds and never sell you will continue to get moneyUTF and TUG have been paying dividends since 2004. CLOZ and JAAA are new ETFs but they invest in one of the safest assets available except government bonds. I would suggest you read the Book The Income Factory and look art armchair income on youtube.
If you look away from money market accounts, HYSA, and government bond funds you can get dividend funds that have yields of 5 to 10%. Dividend are cash payment made directly into your brokerage acount. You don't see the dividend stock together the money. I a retired and living off of my dividend inomt of 5K a month. Funds I am using are QQQI 13% yeild, ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7%, UTG 6.4% JAAA 5.5%.
There is a r/ fire sub were people discuss investing for retiring before age 60. Age 60 is a required retirment data. it is just the date that the retimrent funds open and allow withdrawals without penalty. You don't need to use a retirment account. you can use a taxable brokerage acount with no restrictions on deposits and withdrawals. Yes you owe taxes when you receive dividends or sell stock. So investors need to understand taxes and learn how to estimate the tax impact. But beyond that you can retire using a taxable account. After I started my retirment fund and set up a saving account. I started investing in growth. The idea bing that if Islet my job I could sell it off for additioanal income. Turns out I worked 32 years at that company before I retired. So I had amassed substantial ammount in growth. I then learned about dividends So I sold off much of the growth and reinvested that money for dividneds, At 55 i retired with 5K of of dividend income. If I had known about dividned income I possibly could have possibly retired 10 years earlier if I had knowns about dividends earlier. I am still a few years away from 60 so I am moving my 401k into my roth and investing specifically for dividends. Using fund like QQQU 13% yeild, ARDC 9%, BPBDC 9%, EMO9%, CLOZ 8, UTG 7%, and UTF 6.4%, and JAAA 5.5%. currently I am getting 5K a month from dividends from the investments in the roth. which is being reinvested . I you take these same funds sandpit them in a taxable brokerage account and build that up you could get enough income to retire when you want. I would recoment you read the book the income Factory and look at armchair income on youtube.
Drop some into fidelity gold fund. Drop some into monthly paying dividends like MAIN or UTG.
For those wanting to retire early by selling stock for income the recomendation is to have 25 time your living expenses. for dividned you could get buy with about 2.5 times living expenses. The key is to aim for yields of about \^% to about 12%. I'm using funds like QQQI 13% yield , EIC 11%, ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7%, UTG 6.4%JAAA 5.5 % for dividend income For more fund ideal look at Armchair income on youtube. He is investing exclusively for dividend income in retirment.
Must be friday All the anti dividend /Passive income people have spammed this post. yes safe bonds and HYSA don't pay much in yields. But there are dividend funds that pay much higher yields. QQQI (A covered call fund) for example has a 13% yield. Not the highest yield available from cover d call funds but It doesn't have any of the problems the higher yield funds have. 4.5 invested in this fund will produce $585 a year not much. But is you deposit 500 a month for 10 years you will have 125K and the yearly dividend of 16k a year. A little over 1K a month. And you pay less taxes on the dividends so it is a tax efficient fund. The key to high dividend income is to consistently depositing money every month to build up a large portfolio. Not covered call funds are not the only choices In addition to QQQI I have ARDC 9% yield, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7%, UTG 6.4% and JAAA 5.5% I have these in my roth and they are currently pumping about 5K a month into my roth. I also have some in a taxable brokerage account so I can access the cash now.
At some point people need money from their investments. Now you can sell for income or invest for dividends. I am 55 and my current dividend income is 5K month and I retired and that covers my basic living expenses. By age 60 when I have access to my retirement account I should have 10K a month of dividned income. My dividend investments right now are QQQI 13% yield, ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7%, UTG 6.4%, JAAA 5.5%
I have batch 30% yield, QQQI 13%, SPYi 11%,EIC 11%, ARDC 9%, BPDC 9%, EMO 0%, CLOZ 8%, UTF 7%, UTG 6.4%, JAAA 5.5%
Inflation often comes in one short surge than drops. The long term average inflation rate in the US is 3.2%. So it will probably not be as bad as you think but the future is unpredictable. I suggest you look into a different retirment stratagy that doesn't involve drawing down your portfolio. Let's assume you need 100K to cover living expenses in retirment. you could set asside 1million in your portfolio into dividend funds and get about 100K in dividends. Dividends are profits of your investors distributed to you as cash without selling shares. There are people that have retired on 200K of dividend income per year. Also on risk no one plans for is an injury or medical issues that prevents you from working. Effectively forcing people to retire early. One thing you can do is to invest in dividend income in a taxable acccount. I retired early with 5K a month comming from dividend funds in my taxable account. I would suggest you read the book The Income Factory. And Armchair income on youtube is a good resource for fund ideas for an income factory. Some of my favorite dividend investment are QQQI 13% yield, ARDC 9%, PBDC 9%, EMO 9%CLOZ 8%, UTF 7%, UTG 6.4% and JAAA 5.5%. You can add government / cooperate bonds and municipal funds.
Generally the starter recommendation is to establish a retirment acount and deposit the maximum allowable (if possible) and establish about 6 months of living expenses theIRA don't invest the money you put into it. You have to choose the investments and how much of the money goes into each fund. After that many people just stop. My recomendation is that the emergency fund should be in a money market account in taxable brokerage and then I would start slowly building a dividend fund. Dividend fund distribute their earnings quarterly or month though cash dividend payment directly to your brokerage account. that money can then be invested or spent as you wish. I would slowly build up money in this fund and then when it exceeds $600 a month invest the dividend income in the Roth and continue to build the dividend fund in the taxable account. Any extra dividend income can then be used to pay uitility, gas, food bills while you continue to add money the dividend fund. The overall goal is to eventually have enough dividend income to cover your living expenses so your work income could be deverted to other uses. This would also insure you have income if you loose your job or cannot work for midical reasons. I now have enough dividned income to cover all of my living expenses. About 5K a month. QQQI is a good starter fund for a taxable brokerage account13% yield and it is tax efficient fund. It would also work well inside the roth with VOO keep 50% of your deposit in QQQI and 50% in VOO in the roth. You could also di the same in taxable brokerage. Eventually you could deversify to other dividned funds. My Roth it is just invested in dividend funds. I am currently using QQQI 13% yield, EIC 11%, ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7%, UTG 6.4%, JAAA 5.5%. And you could VOO to that if you want.
First off build your emergency fund and invest in your employers retirement plan or a roth if they don't have one. Growth index funds are find one theretirment account. If you want to be able to access the money then I suggest you open a taxable brokerage and invest in dividend funds. Dividend funds produce passive income. You don't have to sell shares to get the income. The passive income will be invaluable if you loose your job and unlike a cash emergency fund the passive income will not run out of money. you Couldstart out with a fund like QQQI 13% yield and it is tax efficient. For now simply have the dividends reinvested. But it is a good idea to have multiple funds which invest differently. If you have need fro the money you can turn off the dividend reinvestment and just collect the cash in a money market fund. With 50K invested in QQQI it will generate about $500 a month. As you gradually build the income you could start using the income to cover monthly bills and maybe eventually get enough income to cover all of your living expenses. Allowing you to invest more of your work income. I have been working on this for a while and I get 5K a month of income from dividends which is enough to cover all of my living expenses in a high cost of living area. I am currently using the following funds for income QQQI 13% yield, SpYI 11%, EIC 11%, ARDC 9%, PBDC 9%, EMO 9%, CLOZ 8%, UTF 7%, UTG 6.3%, JAAA 5.5%, I was able to retire at age 55. But if I started dividend investing earlier I would have retired much earlier. Now you could have a growth index fund like VOO in the account as well.
Long term investing has been (relatively) easy for the last 100 years or so. Buying the S&P 500 and resisting to urge to sell when things feel uncertain was arguably the only advice an investor needed to succeed. The firs growth index fund became available around 1980. retirment funds also became available at about the same time. But both don't really become widely available until about 90's. Prior to 1980 the common investing stratagy was to invest for dividned stocks and and picking growth stocks. And what you are seeing today is not really different than what people were seeing in the late 90's if you subtract everything trump does. Investing and holding the S&P500 but good investors don't stoop there or stop at the 6 month emergency fund. Some people now are starting to add more bond and dividend funds. in Bear markets growth can be hard to find. But dividends keep common and pond keep paying. and don't limit yourself to fund paying a divined of 5%There are good dividend funds that pay %% to about 10%. I like QQQI 13% yield, SPYI 11%, ARDC 9%, PBDC 9%, EMO 9%, PFFA 9%, CLOZ 8%, UTF 7%, UTG 6.3%, JAAA 5.5. Another thing people do is after their retirement funds and 6 month emergency fund are setup people start investing for dividends in a Taxable account. Why we all have mostly bills to pay including home mortgages and rent. Everyone is hemorrhaging money monthly. So some people start investing for dividends in a taxable to with a goal of covering common monthly bills. It takes time but eventually you could get enough income to cover much or all or your monthly expenses.
Do you play poker? Because what you're experiencing is the same thing experienced at the table, and distinguishing somebody who can healthily play poker to somebody who really cannot. I call it flop bias. Let's say you are in a game, you are dealt Queen of Spades, 7 of Hearts. You are early to act, but not first to bet (UTG+1). The person under the gun raises by quite a big amount. At this point, you know you probably shouldn't play your hand and fold. The table bets and folds and the flop comes out Queen, Queen, 7. You would've made an incredible Full House, and almost certainly would've won this hand. Do you feel like an idiot for folding? Well, you shouldn't. You might the right decision at the right time, for you. The unexpected outcome of the flop is an irregularity that is impossible to gauge. More often than not, that under the gun big raise is dominating your hand, and by staying in and calling you are just wasting money. So let's bring that back to your situation. You saw QBTS and thought this looks like a good deal. You bought some and held a while. Then, QBTS price raised by 700%. A huge amount! Do you secure your profits now or hope it goes even higher? And if it did go higher, how MUCH higher? Is the risk of losing all your profit worth it for a bump to 8? 9? Not really... So you sell. You secure your profit and you fold your hand. Then the flop comes a year later with that stock at 30. You feel regret for not holding. But should you? No. Because, and this is the fundamental important factor in this entire example: You made the right decision at the right time. Could you have been reckless and held hoping for more profit? Sure. But is that a healthy and sustainable way of playing? Not really. I hope this helps. PS I made almost the same exact play you did; but I made the right decision at the time.
Some people don't tolerate market crashes well panic and sell at a loss.Typically this is common in those that are older and have no experience with investing. You know your risk tolerance but do you know your moms? Typically these people do bettrterwith dividend stocks or funds. In the US I like QQQI 13% yield, SPYI 11%, ARDC 9%, BPDC 9%, EMO 9%, and CLOZ 8%, UTF 7%, UTG 6.3%, JAAA 5.5%. The lowest yield funds are the safest and even the higher yielding funs a very good. She won't see big big gains but she will see consistant quarterly or monthly payments.
Off the top of my head: UTG, PCN, HTD
First step would be to increase if possible the amount deposited per month in your IRA. IF that is not possible you can open a Roth IRA at any brokerage That would allow you to save another $7000 for retirement. With both IRA and Roth their restrictions on whithdrawaling the money before age 60. IF you want access to the money at any time without restriction you need to open up a taxable brokerage account. Many with growth investments in their retirment accounts will continue with the same growth investments in a taxable account. But others prefer to invest for income in the taxable account. a good money market funds is equivalent to a bank High yield savings ac counts. I encourage you to keep 6 months of cash in brokerage money market account. But any additional money should go into a high yield dividend funds CLOZ is one very safe fund to use with a 8% yield Don't automatically reinvest the dividends. When the cash dividned is payed it will then show up as cash in you money market account. You can then use the money to pay bills or other expenses or reinvest the money in a Roth account or invest the money in CLOZ. Never sell shares of CLOZ. If you sell shares of CLOZ the dividends will stop coming. Now you can invest in other dividend ETF than CLOZ. QQQI has a yield of 13% and you pay less tax on the dividend income. QQQI has more risk than CLOZbutit has the very desirable yield. Now yields above QQQI are available but many of those funds don't last long and you gradually loose your original deposit. I am currently getting 5K a month from my taxable brokerage acc count using QQQI, SPI, EIC, ARDC, PBDC, EMO, CLOZ, UTF, UTG, JAAA. overall this has a yield of about 10%. Now to get 5K a month form such an account you need to gradually over time depoist 500K into the dividend portfolio. The rewards of having this much passive income are worth it.
Almost all investors have a cash account. And most of the time it is in bank or taxable brokerage account. Partially for emergencies and pratially to help handle the big unexpected bill. But that said the cash account is the first step in the a taxable account. A emergency cash fund won't last long is you loose your job in recession. It could take form than a year to find a new job. FPassive income is better because the money will not run out. A fund like CLOZ 8% will pay a dividend (passive income. It will take time to build up the money in CLOZ to get meaningful passive income from it. If you don't need the passive income simply reinvest the funds. Or use the money to fund your Roth account or pay monthly bills. But it things go bad turn off any automatic dividend reinvestments. The dividends will then show up as a cash depoist into your money market account. I realize this in my 50s and took some excess growth I had in a taxable account and built up pasive income of 5K a month and retired. I am currently suing the passive until my retirment account become available. Some People use SGOV instead of CLOZ. Others may use riskier funds like PBDC 9% yeid, EMO 9%, ARDC 9% UTF 7% or UTG 6.3%. Other other will use covered call bunds like BTCI, QQQI, and SPYI.
S&P is popular due to its high growth. In economic downturn growth will mostly vanish. But growth stocks are not the only investments out there there are a lot very good dividend funds available. These don't have much if any growth but they pay you cash monthly or quarterly. Some good Examples are ARDC 9% yield, PBDC 9%, EMO 9%, PFFA 8%, CLOZ 8%, UTF 7%, UTG 6.3%, and JAAA 5.5%. You simply buy and hold the fund. The cash dividend is deposited into your account the market will go up and down but dividends keep paying. regardless of what the shar price is going. I currently get 5K a month from dividends.
It’s more of how much are your expenses. House is paid off, car bought with cash. My monthly nut is only 2k. Now just waiting for access to IRA’s with no penalty withdrawals. Mostly invested in CEF’s like BST, UTG, BIT, JQC, GOF and a little bit of ULTY.
The problem with the stock market prices of shares can move up and downunprdicatably. So if you need the money in 9 months you won't know how much money you will have in 9 months. You could have 180K or less or 220K or more in 9 months. But let's assume that you don't spend the at money on a new house to see what could be done. I you invested 200K in QQQI an income fund with a lileld of 13%. 200K in this fund will produce 2K a month of extra income. And do to it ROC tax classification on most of its dividends you would pay no tax on that income for about 6 years. Income that could cover much or all of your rent. Now it is possible to get higher yields but those are less stable so for this I wouldn't recomend anything higher than QQQI. Now there are other funds with yields between 10% and 5% yields but most don' have the tax classification of QQQI. So the extra income will be taxeded as regular incom. Which would be the same as 2000 a month raise in you pay. Some examples of lower yielding funds are ARDC 9%, EMO 9%, PBDC9%, PFFA 8%, CLOZ 8%, UTF 7%, UTG 6%.
I would gradually sell it off and reinvest it. yOU could reinvest some in JAAA 6% yield,9%.CLOZ 8% yield these are veritable reliable dividend payers, Keep each at 50K invested. Then add 50K in UTF 7% UTG 6%, PFFA 8%, PBDC9%, EMO 9%, ARDC. These funds produce income you could use to pay utility bills rent, mortgage. roth deposits or simply be reinvested in these funds. If you sick or injured injured or become unemployed for an extended period of time you can use the income to cover expenses until you can return to work. Or you could invest in growth index funds. If you have a big unexpected expense you can sell the growth shares you could get enough money to cover the expense.
I would put it in QQQI the high yield from this fund will generate about 1K of income a month. You can use this income to help cover living expense or used to make deposits into your Roth IRA. Or you could add more money to QQQI to get even more income. I did this and added more funds like SPYI, EIC, ARDC, EMO, PBDC, PFFA, CLOZ, UTG, JAAA. Today I have 5K a month of income from these investments.
Your at a point were you need torethink how you invest. You can keep in vin sting in growth index fund (all the fund you listed ar growth index funds. I would suggest investing you money in the taxable account into dividned ETF. Dividends are cash profit sharing payments to you. For example you could put money in your taxable brokerage account into CLOZ with a 8% dividend yield. 100K invested in that fund will generate all the money you need for your roth deposits. Or you could use the money to pay bills and other expense. You can get yield from 1% to 10% with about as much risk as your growth index funds. CLOZ actually has less risk than growth index funds, I have fund these dividend funds in my taxable account EIC 11%, PFLT 12%, ARDC 9%, EMO 9%. PBDC 9%, PFFA 8%, CLOZ 8%, UTF 7%, UTG 6.3%, JAAA 6%
I did that and I am now retired at 55 and living off of my dividneds. Currently at 5K a month of income. Enough to cover my living expenses. I would like 100K in retirment and I estimated my tax for regular dividends with no other income and found my tax owould be 15K or 85K of income after taxes. It will be a few years before I get there. So it is possible to do it with just high tax regular dividends. Qualified dividends have a lower tax. But they are other low tax operations municiable bonds and ROC dividends. ROC means return of capital ( a tax classification) and freaks an out a lot people but A good fund can have ROC dividends by doing tax loss harvesting while earning a profit from your investments. This creates the ROC classification without returning any of your investment. The advantage Of ROC dividends is that you pay no taxes on the dividend. But when the cost basis of your shares reaches zero (which takes years you pay long term captial gains taxes which is the same as qualified dividend. Neos has some ver good covered call funds (see their website for a full list. But two of my favorit are SPYI 11% yield and QQQI 13% yield. You won't find qualified stock or ETF with this yield. And with these yields you can build up passive income faster than you can with qualified dividends of Note some other funds I hare (most are regular dividends) are : EIC 11% yield,, PFLT 11%,EMO 9%, PBDC 9%, ARDC 9%CLO 8%, UTF 7%, UTG 6.3, and JAAA 6%.
The highest utility from investments comes from cash dividends. you can spend the cash on enacting you need or reinvest it. Growth is nice but it isn't real until you sell it and cover the income to cash. My roth is invested in BTCI 25%, QQQI 13% yield, PFLT 12%, ARDC9%, EMO 9, PBDC, PFFA 8%, ClOZ 8%, UTG 6.3%, JAAA 6%. These investment in my roth generate about 30K a year in the roth. Which I reinvest. IF you use a taxable account the money could be used to cover living expense ore reinvested.
Personally, I would dollar cost average. The market value is high right now. We could get big correction. If so, when you see a big downturn, put more in then. On the other hand, there are dividend producing products, like AMLP and UTG that are fairly valued. There are some individual stocks that seem fairly valued. Personally, I’ve been putting money into Micron. If you’re not interested in stock picking and are going ETF’s, right now I would dollar cost average. Good luck.
You have reached the point were more money in a saving account is no longer beificial to you. And if you have your retirement accounts are maxed out, you need to start using a stable brokerage account. Now you can open that and put money in growth funds (which are general tax efficient) But then to get money out of your account you have to sell share to get the money out and that generally means timing the market. An alternative aproach is to invest in a good covered call dividend fund that is tax efficient. For example QQQI has a yield of 13% is tax efficient and doesn't have the NAV erosion issues many warn against. You can collect eh dividneds as cash instead of reinvesting it. And use that cash to fund repair projects and other bills and chains you need money for. Now it will take time but if your account gets to 100K I would put holf 50K in QQQI which would generate about 6K of cash a year. leave the rest in your savings. now for future deposit you could put them in your savings or into QQQI. And if you don't need the dividend reinvest them. QQQI pays out monthly. Now if you don't want to use a covered call fund there are a wide variety of funds available to use. JAAAA 6%yield, UTG 6.3%, zuTF 7%, ClOZ 8%, and PFFA 8% are lower yielding funds but they always pay the divined even if the market is down. Other good funds with higher yields are PBDC 9%, EMO 9%. PFLT 12%. Now with most of these you don't get any tax advantage as you do with QQQI. I built up my dividned income to 5K a month which allowed me to retire at 55. earlier than planned. 5K is enough to cover all of my living expenses There is no limit as to how much dividend income you can get. When you get to about 3 K a month of income from dividned you could loose your job and live off of teh dividends indefinitely.
Most of your investment are growth funds. meaning 99% of your earnings comes from share price increase. There are fund that invest in companies with little to no growth but they produce a profit sharing cash payment to you about once per month or quarterly. So when the market crashed these stocks still (of at least most of them) still pay a dividned. You can get dividends from 1% yield to 100%. but for what the best rang is about 1% to 8%. Some of the safest don't even invest in companes. Bond (corporate and government), and Collateral loan obligations are some of the best. Some of these that I will probably be adding to my portfolio are JAAA 6% yield, UTG 6.3%, UTF 7%, CLOZ 8%, PFFA 8%, Inane bear market dividend producing assets do better than growth assets. In a bull market growth does better than dividends. Since about 1/2 the time the market in a bull or bear condition it only makes sense to have a protfolio that is a mix of dividend and growth.
Crash resistant fund are generally dividned funds that in vest in very stable assets. These funds will go up and down in share price with the market but even in a sever crash like in 2008 they likely will continue to pay a dividend. Some of the best ones I know of are JAAA 6%, UTG 6.3%, UTF 7% CLOZ 8%, PFFA 8%,
Moving assets to income producing securities should be done before you get to retirement to secure reduce your risk. BND is a good choice but there are many good choices. Funds like JAAA 6% yield, JBBB 7.8%, CLOZ 8%, UTF 7%, and UTG% 6.3%. All have higher yield than BND and other government bond funds and historically are very safe investments. less safe but still not terribly risky are PFFA 8% yield, PBDC 9%. But you also need to factor in your expected income needs. you need to have a good estimate of your income needs in retirement and then gradually work on configuring your portfolio to generate more than that income. IF your account generates more than you need and you reinvest the excess income you will never run out of money.
Enviable position but tough call. Maybe sell 3/4 of each, pay the long term gains, and invest in income. UTG has been treating me well at around 5.5% with nice recent gains. I’m not sure how you feel about income investing, jets nice seeing those dividends. Musical bond funds are nice, no federal taxes. Nuveen has some good ones. Congratulations by the way.
Nah buy UTG. Nice monthly divy plus all utility focus.
Very difficult, I totally agree. One option is a municipal bond fund. I had one recently that paid 4% but there are no federal taxes. Another option is investing for income with ETF’s. I own AMLP, an etf with gas pipelines paying around 8% and UTG-etf based on utilities paying around 6%. I would consider seeing an advisor. I use Morgan Stanley, I’ve been happy. So, you could do income based investments with a small amount in a board market index fund. You can then use the revenue to invest back into the broad market fund. It’s just one idea. It’s nice to get dividend payments.
you might want to invest in funds like eCLOZ 8% yield, JAAA6% yieldThese are CLO funds basically it is a loan obligation that collateral backing the loan. So if the company with the loan goes into default the collateral is liquidated and you get your money back. UTG 6.3% yieldand UTF 7%yield. both are utility funds but there is very little overlap in there investments. The utilities are regulated and are not going bankrupt and shutting down suddenly. All very safe dividend investments. This limits your exposure to the higher valuations of growth funds for now. * This would generate 13K a year and you could invest all that income into growth index funds. Since you are buying in slowly you are basically dollar cost averaging your purchase. in 12 years you would have 200K in growth and 200K in dividend funds. * You can set up automatic monthly purchases of the growth using the dividend income you could also take half of the earnings and put that into roth and reinvest what is [left.in](http://left.in) growth funds. * You could also ignoregrowth funds and reinvest all the dividend back into funds that generated them. I about 12 years you will have 400,000K with about 26K a year of income. * If you loose your hob at any time and need income you can stop rienvesting the dividends and start recieving the cash during the next dividend payment. Which would be a bout a month. Note I am assuming you add no more money to the 200K. So the only money going in is the dividend income. of cource could add a new higher yielding funds for more income.
Not that answer applies to a passively manage index fund. They just follow a published index like the S&P500. So if a company goes bankrupt they are off the list and a new company is added. However not all funds are based on an index. And some are activelystock managed. Some fund managers just pick the companies or other assets He believes are good investments. If one goes bad they replace it with another one they like. Now these fund managers can change the mix of assets at any time.based on the funds stated objectives. Now the fund managers Have to spend time researching and analyzing assets and monitoring their portfolio which means there is more work passive or UTF. They invest in utility stock and any any corperate bonds they sell. Now the stated objective of these funds is to generate income for investors So share price appreciation is much lower than most index funds. But the dividend is about 6 times higher than a typical pasive index fund. And the assets they hod are very different. UTG pays a dividend yield of 6.3% while UTF 7%. OR take a look at BIZD or PBDC. Both hold a group of companes called Business Development Companies that by law are required to pay out about 90% of their earnings as dividends. BIZD is based on a BDC index and has an expense ratio of 0.4% and a dividend yield of about 11%. PBDC chooses the BDC's it invests in ands an expense ratio of o.75% and a yield of 9%. With noPBDC has a slightly higher total return. Note for BIZD and PBDC an obscure SEC rule requires they to list expenses they never pay so their listed expense Ratio is about 13%. But if you read the prospectus the real expenses are much lower and I listed the values from the prospectus.
Many low beta stocks or funds are Dividend stocks. So you could get: * Low beta * Low volatility. * and income At the same time without adding bonds cash in money market funds. you can get consistent dividend yields of 6 to 10% Which is better yield than banks money market or government bonds. And you can use the dividend to either increase your dividend over time by reinvesting it bank into the fund or stock. Or you could invest the dividend into more growth index funds. UTF 7% yield and UTG 6.3% yield are both good utility funds. Regulated stable companes. JAAA 6% yield and CLOZ 8%. These in collateral loan obligations JAAA invests In AAA rated loans and CLOZ invests in BBB rated loans. These loans are back by hard assets so it the company can't make its loan payment the assets can be sold to pay the investors. EIC 11% yield is a similar fund but it invests in CCC rated CLOs. Dividends are payed out generally quarterly or monthly. and it is not uncommon for dividend funds to pay out there dividend even if the stock price falls in a market crash.
Bonds loose out to inflation because their yield is very close to the inflation rate. The long term average inflation rate is 3.2%. So you should be looking for yields of about 6 or higher. You could invest in CLO (collateral loan obligations with JAAA 6% yield from AAA rated loans. or BLOZ 8% BBB rated loans. There are two really good utility funds UTF 7% and UTG 6.3%. You could set dividend reinvestment to off. That way the cash then goes to a money market account earning about 3 to 4% You could spend or reinvest the money in the money market fund. I am retired and I use this aproach for my income. My income right now evceeds my living expenses. So 80 it spent and 20% is reinvested to insure my portfolio grows over time. Annuities are over hyped by marketing and often cost a lot fro the income they provide. And often the annuity locks you into that one investment for a long time. %
You can move the account to a brokerage without insuring taxes. I use fidelity. All you have to do is contact them provide them with he account number for the american express account number and fill outcome forms and they will mov the acount to fidelity. >I guess I realize I lost money by not putting it in stocks and by inflation. I just don't know what to do. IT is important to realize your fear of risk is is not based on your experience with your investments but your fear of not knowing what will happen. In most cases the fear is a lot larger than actual risk. In my IRA I have a bond fundFAGIX that ear a steady 5% yield but I also have JAAA 6%yield, CLOZ 8%, UTG6.3%, UTF 7%, PFFA 8%. All of these investments produce cash payments into your account regardless of what the share price will do.The share pirice may go down but the cash will still be deposited quarterly. Generally people like you do better with these investments. Now you can add up to 7000 a year into an individual IRA. I strongly suggest you do this every month. Over time as you get more failure with these funds your fear will drop. Some higher yields can be achieved with slightly more risk with funds like PBDC 9% yield, SPYI 11%. And you could put some money in VT. All of these do hold stocks. Start out small first and gradually increase the ammount. in them.
there are always people saying don't invest for X reason or invest for Y reason. Ignore all that and focus on understanding the investment your advisor is recommending read the prospectus for any funds an in general learn how to evaluate your investments. Your advisor can probably guid you or recommend classes or books to read to help you learn. Right now this is all new to you so I would ignore the news and focus on learning about dividend and growth investing and and evaluating 12K a month you are going to owe taxes on that. So keep that in mind and make sure you have have a tax advisor. But that said what i would do is invest the money in low risk dividend stocks. Such as JAAA 6%, UTG 6.3%, UTF 7%, CLOZ 8%, PFFA 8%. Eventually the money your are getting now will run out. When it does you want something to fall back on. All these funds generate cash dividends.
I would DCA in. The market is expensive according to the people who would know. I’ve been buying more income. Problem is that you have to pay capital gains on them. One way is a covered call etf. QQQI uses this technique to achieve a 13% annual yield with monthly payouts. It limits downside risk due to continued payouts according to what I’ve read. AMLP is an etf that pays 8%. It’s natural gas pipeline companies, much needed. UTG is based on utilities, 6.5% yield. AMLP and UTG both own “real assets”. They should also limit downside risk. Just some thoughts. It’s hard to know exactly what to do.
Appreciate the tip — UTG does look solid for income, though as a CEF it’s a bit different from ETFs like VOO/SCHD (leverage + premium/discount to NAV). I’d see it more as an income satellite, while keeping VOO as the core.
Why not utilities when nearing retirement and after rather than young? I'm about to move some intl over to some utility funds like UTG.
You could invest the money in JAAA 6% yield and JBBB 8% yield and PFFA 8% UTF 7% and UTG 6%.Thes all invest in different assets and provide a much better yield. These are dividend funds that pay out quarterly or monthly. Some higher yielding options are PBDC 9%, ARDC 10%,EIC 11%, and SPYI 11% the lower yielding funds are safest while the higher yielding funds have slightly higher risk. YOU will have to use a taxable brokerage acount for these funds. Set dividend investment to off. Cash will show up in the account and from there you can move that to your bank account. The higher yield of these funds will probably double your income. Any money you don't spend reinvest it for more income. Your taxes will go up due to the higher income. So you probably will have to make some adjustments to your tax withholding. I strongly suggest you read the book The Income Factory. and look at Armchair income on youtube.
I’m an equity investor though recently I’ve been putting into equities with real assets. US natural gas pipeline company ETF named AMLP. It pays an 8% yield. Considering the increased U.S. energy needs for AI, I think it’s a winner. UTG is an ETF of utilities, pays just over 6%. That’s 7% combined obviously. You put 250K at 7%, that’s 17,500 a year. That’s almost 1500 a month. No insurance, repairs, yard work or other hassles. That’s just me though. I’m not sure what housing is like in Norway.
I am really interested in your post, but also a little confused on the details. If you wouldn't mind adding some clarification. >QQQI 13% Yield, ARDC 12%, SPAYI 11%, EIC 11%, PBDC 9%, UTF 7%, SCYB 7%, UTG 6.3%, PFFD 6% FAGIX 5%. * The above is only 50% of your portfolio, and the other 50% is in growth ETF not part of the list above? * Most important question: The 5K in monthly income you receive is based on what dollar amount invested in the above portfolio? * Those numbers add up to 87%. Where is the other 13%?
The solution to this cash reserve problem is not to use cash or growth index funds as a reserve for a market down turn. Instead consider investing your cash and taxa able brokerage holdings into dividend funds. For example if we take your 150K of cash and reinvested that for dividned. Now with 150K we cannot get enough cash to provide 9K a month. but with BTCI 25% yield you could get 3K a month of income Now normally I would recemond QQQI with its 13% yield due to my risk tolerance. BTCI is the maximum yield I would be comfortable with. But with your cash and taxable brokerage invested in BTCI you would bet very close to 9K a month. If you just use the cash in BTCI and reinvested all the money back into BTCI you will have 300K in BTCI and would have an income of 6K a month. If you don't need the money reinvest it in other funds to reduce single fund risk. or you could use the money to pay off a home loan or any debt you have. Reducing your living expenses. The key things to remember about dividneds is that the money is from the companies profits. And ever in 2008 and the dot. crash most companes were still profitable and still payed their dividends. I retired at 55 and I invested in QQQI 13% Yield, ARDC 12%, SPAYI 11%, EIC 11%, PBDC 9%, UTF 7%, SCYB 7%, UTG 6.3%, PFFD 6% FAGIX 5%. A mix high yield and lowe less risky yields And I still have 50% of my portfolio in growth index funds. My living expenses are about 4K and I currently get 5k from dividends so 80% of my income covers my living expenses with the remaining 20% being reinvested for more income. Now if there is a correction in the market most of my dividend income will continue. But if not I can sells some growth for additional income. A good book to read is the income factory. And armchair income on you tube invests the same way but does good reviews of funds that can be used for income.
I would recomend diversifying into high quality dividend funds That way when the market falls the dividends will help contract some of the decline. I am using dividend funds like QQQI 13% yield, ARDC 12%, SPYI 11% EIC 11%, PBDC 9%, UTF 7%, UTG 6.3%, PFFD 6%.
right now you have two choices, open a a roth or a taxable account. I don't know if you have access to a 401K. I am assuming right now you don't. with 800 a month you and the roth depoist limit of 7000 you will have enough to open a roth and taxable account. Max out your roth every year. Most just invest in growth index funds Like S&P500 index funds. but with he deposit limit in 20 yours you would longly have about 500K available for retirment and it would not generate any meaningful income. In my opinion The best Roth investment is a high yield dividend fund like BTCI 25% yield. In 20 years you will have about 3.9 million in the acount producing 900K of dividned income a year. Yes there are some risks with a yield at 25% but it is the highest reasonable safe yield I know of. Realistically in 10 years i would start diversifying your investments in the roth. I am currently investing in QQQI 13% yield, ARDC 12%, SPYI 11%, EIC 11%, PBDC 9%, UTF 7%, SCYB 7%, UTG 6.3%, PFFD 6%. All would would make good additions to your roth when you start diversifying away from BTCI. And all are good choices for a taxable account. Once you reach the 7000 limit in the roth open a taxable account and start investing for dividends. The purpose of the taxable account is to give you a backup source of income. having a lot of dividend income is great backup in case your are unemployed or cannot work for medical reasons. I am following an investment stratagy similar to the book The Income Factory. Armchair income on youtube also follows this stratagy. Both list the funds they use or have used and that that is 100 in total. Armchair income also does detailed reviews of his investment choices. Which give you a good look at why he picks the funds he insists in.
your could sell it off slowly and reinvest the funds for dividends. Dependinding on the yield the reinvestment you could get yearly cash income generation of 50k up to about 100K of income from your investments. Cash generated in the 401K will have to stay in the 401K until you reach age 60. But you can reinvest this cash to grow your earnings. IF the stock is in a taxable acount you could replace a immergeny fund with a passive income fund. I would read the book the income factory. It is about investing for dividend income. and list 68m funds the author has used plus several example portfolios. There ia also Armchair income on youtube. he list 38 funds has has in his dividend portfolio. and does detailed reviews of some of them and other funds that may be of interest. He also interviews fund managers and did interview the author of The Income Factory. That should give you enough ideas to on how to invest the money. I am currently using QQQI 13%, ARDC 12%, SPYI 11%, EIC 10%, PBDC 9%, UTF 7%, SCYB 7%, UTG 6.3%, PFFD 6%. 5
buy when the market is down 20% to 30% at that point it may not go much lower. The market has only lost 40% in a year 3 times in the last 100years. IF possible invest in dividend funds Dividend funds generally perform better in a recession than growth funds. She good dividend funds are QQQI, SPYI, PBDC, UTG, UTF, PFF.
Utility- and Energy/MLP-related funds should do well, like UTF, UTG, ASGI, TYG, KYN, et al.
There is a lot of risk in yieldmax funds. That doesn't mean they will fail tomorrow or next year. We simply don't know how long they can keep paying these very high yields. There are a growing number of people that put in only the ammount they are willing to loose and then use the dividend income to buy less risky stocks. That is what i am thinking doing and and I suggest to do the same. Lower risk investements I use are PFFD 6% Yield, UTF,7%, UTG 7%, Scab 7%, PBDC 9%, EIC 10%, SPYI 11%, ARDC 12%, and QQQI 13%.
Most economist are expecting higher inflation due to the tariffs and with growing world economic instability I would now focus more in on passive income investments. Such as these dividend ETFs: QQQI 13% yield, ARDC 12%, SPYI 11%, EIC 10%, PBDC 9%, UTG / UTF / SCYB all with7% yield, A.nd PFF 6%. These funds in a roth or 401K will compensate for the potential lower earning of index fund so your retriemtn account will do better than one without dividends. In a taxable account then income would help protect your from unemployment.
He's asking about the business of powering those data centers, not the business of owning data center properties. I invest in that space through utilities and infrastructure funds like UTF, UTG, and BUI.
Target date funds gradually sift their investments from mostly growth to income over time. So when you retire you have enough income to cover living expenses with enough growth so that you can maintain that income over time. Ideally you want more income than you need in retirement with enough growth to insure you never run out of money. Target date funds as a result of their investment stratagy are actively managed. Most growth index funds are passively managed. Meaning more people are needed to select the income investments and trim investments that don't work out. More people means more expenses. 0.75 is actually normal for actively managed funds. while 0.3 or less is about normal for passively managed growth index funds. But if you want you could do it yours with say 50% growth index funds with the remainder invested for income from dividend funds. Many focus on bonds but the yield is often too low for that to work well. Bonds barely keep up with inflation. But excluding government bonds you can get much higher yields. 9%, UTF 7%, UTG 7%, SCYB 7%, PFFD 6%. And I do have FAGIX a bond dung that earns 5%. But the bulk of my earnings comes from yields greater than 6% With an average yield slower to 9%. My current income is about 5K a month.
time to get aggressive with the income funds on DRIP and hope its enough to turn off that DRIP in about 15 years SPYI, QQQI, JEPQ are staples of income investing. you could go CEF's with RQI and UTG or they could go full REGARD and hit up the YM Funds on DRIP for a quick snowball, i suggest AMZY, CONY and ULTY
You are doing well and have made progress. At this point I would attack the central problem you have Income. I would start investing in dividend funds like QQQI 13% yield, ARDC 12% EIC, 10% PBDC 9%,UTG 7% these funds share the ir profit with investors. so quarterly or monthly you get a cash payment to you You could over time build up passive income to slowly to handle your monthly bills. Eventually you could retire and simply live off of the income.
This is why I switched from growth index fund to dividend ETF and CEF fund. I am currently invited in QQQi 113% yield, ARDC 12%, SPYI 11%, EIC, 10%, PBDC 9%, SCYB 7% UTF 7%, UTG7%, PFFD 6%. Overall these funds produce 5K a month of income. Most goes to living expenses including healthcare I retired at 55). But 1K a month is reinvested which will help minimize inflation. When the dividends come in they go straight into a money market. fund. So I always have cash on hand. But I plan on keep a sizable amount in growth index for emergency needs, Unexpected large bills, and if needed I can harvest some growth and use that to increase my income as an inflation adjustment. The funds can also be used to replace any fund if it starts having issues.
A couple of years of savings is out of reach for most people. However historically during long bear markets dividend perform much better than growth funds. If you invest in utility funds like UTG and UTF both with a dividend of 7% they will do better when S&P500 index funds have zero or negative returns.
Personally I find I like cash dividends for income. I have minimal ammount. in government bonds because the yields are so low. Right now some my favorite investments are QQQI 13%, ARDC 12%, SPYI 11%, EIC 10%, PBDC 9% RLTY 8%, UTF 7%, UTG 7%, SCYB 7%. PFFD 6%. I am getting about 5K of income a month from these sources.
With CD the maximum yield you are likely going to find is about 6%. However with a und like QQQI you can get a yield of 13%. And there are lot of choices in the 6 to 9% ranks for dividend ETF or CEF funds. And it is also possible to find yields win the 20% range or higher. I am investing in QQQI 13%, ARDC 12%, SPYI 11%, EIC 10%, PBDC 9%, RLTY 8%, UTF / UTG / scab 7%, and PFFD 6%. And unlike CD they don't expire. meaning once you have built the portfolio the dividneds will continue to come in indefinitely. I currently get 5K a month of dividend income and I am retired.
I would not useChat AI for invesment advise. i would rather read the book The Income Factory. And youtube ArmChair income is an excellent resource. I am investing in these fund with the following yields; QQQI13% yield, ARDC 12% , SpYI 11%, EIC 10%, PBDC 9%, RLTY 8%, SCYB 7%, UTF 7%, UTG 7%, PFFD6% That work out to an average yeild of about 9%.
Just an example of what you could do with 300K. invest it in QQQI 13% yeild and put the dividneds into a money market fund. I April when you do your taxes the you will have to pay a tax on the dividneds. So use a portion of the cash to pay the tax, and then use money left over to pay off your home loan and any other debt you have. After the first year you will have an idea as to how much the dividend should be kept as cash for taxes and how much your can use immediently to pay off debt. Overall QQQI will generate about $39,000 a year pf Income before taxes. And as a further benefit QQQI takes steps to reduce the taxes you pay on the dividend. But keep in mind you will have to pay taxes on inherited money so in the end you might has about 200K instead of Also while the potential with QQQI it is just one fund and history has show you are better off using multiple funds, That way in the rare event that one goes bad the rest of your money will still be in god funds. So I have spread my money out over fund like PFFD 6% yield, UTF / UTG / scab 7%, RLTY 8%, PBDC 9%, EIC 10%, SPYI 11%, ARDC 12% and QQQI 13%. For my portfolio it generates enough to cover more than my monthly living expenses.
Most investors seek investments that earn around 10% to maximize ether growth of there protfolio Gold right now can be sold at a decent price but most of the time it isn't worth a lot and it doesn't pay a dividend. In may case I invest in dividend fund which earn me about 5K a month of income. 80% covers all of my living expenses. The rest is reinvested to grow my income Hopefully enough to keep up with inflation.I am invested in QQQI 13% yield, ARDC 12%, SPYI 11%, EIC 10%, PBDC 9%, RLTY 8% SCYB / UTF, UTG 7%, PFFD 6%
I would not expect your taxes to be zero but I don't know anything about taxes in puerto Rico. After you cover any taxes you will need to invest it. I would look at dividend investing. Over the last few years I started using growth I had to build a dividned portfolio. I retired earlier than expected and now I have 5K a month of dividend income. I have money invested in these funds PFFD 6% yield, UTG / UTF / SCYB 7%yield, PBDC 9%, EIC 10%, SPYI 11%, ARDC 12%, QQQI 13%.
I would open a taxable brokerage account. and move your mo money into it. put the money into into a money market fund. Then slowly move money into QQQI which has a dividned yield of 13%. Do not automatically reinvests the dividneds. The dividend payments should go directly into your money market fund.Eventually you will have a cash account that is bing fead by the dividends from QQQI. You could over time graually add other dividned funds. I have PFFD 6% yield, UTG / UTF / SCYB 7%, PBDC 9% EIC 10%, SPYI 11%, ARDC 12%. Any extra cash gets reinvested. Eventually you could build up the account to get enough income to cover all of your living expenses, utility bills, bills, food, clothing, car cost, insurance. and housing.
with your uneven limited income for now I would put put money in QQQI. this is a income fund with a dividend of 13%. IF you build up the money in QQQI to 100K that one fund will generate 10K a year of income that goes directly into your rothand you still can contribute 7000 per year of your taxable income. Once QQQI is at 100K you roth is basically self funded. So it will continue to grow even if you don't have money to depoist into the account. Once you have 100k in the fund you can divert the dividend from QQQI and use it to buy VTI VXUS in the end you want 50% of your portfolio in index funds like V%I VXUS. with the other 50% in dividend funds. That way the dividend funds can supply you with income while the index funds can be used for unexpected emergency cash needs, or periodically harvest the growth in the invest funds and use the money to adjust your dividned income. For the dividend portion of my retirment I am using funds like PFF 6%,UTG 7%, SCYB 7%, PBDC9%, EIC 10% ARDC 12%, SPYI 11% and QQQI. you basically want enough dividend income to cover all of your living expenses with some extra cash left over every month. And reinvest any extra money.
SPYI, JEPQ and UTG to juice your income and Qualified dividend stocks for stability and dividend growth NFA
You need to invest for pasive income. For example. you could open a taxable brokerage account and inis a dividned fund. QQQI is nice one. it has 13% yield and takes steps to reduce the taxes you pay.. IF you put the roth depoist limit in this account yearly ns ewincwar raw siciswnsa,. IN 10 years you will have $100,000 in the fund and the yearly earnings willl be 13,000 or about 1K month. IN about 20 years you will have 600K with a yearly income 75K a year6 K a month of in come. This is a simple example of what is possible. But you don't generally want just one fund generating income. IF one goes bad you could loose a lot of money and time. If you spread your money equally over 10 funds then the impact of one bad investment is only 10% of your income. It is not unusual for people to have 20 funds in a portfolio. I didn't realize this until I was in my 50s. But I have did built up investments in index funds and other growth stocks in a taxable account over the years. So I started converting that to dividned investments. suing ufund like PFFD 6% yield, UTF / UTG, SCYB 7%, PBDC 9% EIC 10%, SPYI 11%, ARDC 12%, QQQI 13% I now have 5K of income a month. 4K Covers my living expenses including health insurance while 1K a month is reinvested for inflation protection. It still will be several years before I can use my well funded retirment accounts. And I still have more assets still available in my taxable account to fix any issues with what I have and increase my income. I wish I had done this at your age! Now this extra income does does come with additional tax. So I make quarterly estimated tax payments to the IRS. But that issues comes with the benefit that I have retired early and don't have to work. Some good resource es to guid you on this is the book "The Income fFactory. And ARmChair income on your tube. Both invest this way and the book list 68 funds the author has used, and Armchair income list 38 funds. Armshair income also does detailed review of some of the funds he uses. Don't ever withdrawal money from your regiment funds and pay the penalty. It is notworkth it. But you can pause investing new money into them and use that money to build your passive inc ome. Now many people will say dividends are very risky or not worth it. But most of these comments are from people that have never invested for dividends. My dividend portfolio has had no issues other than the taxe. I am also reworking my Roth for dividend income that will not be taxed when I can use it. And moving money from my 401K into the Roth.
I am not relying on government bonds or HYSA for pasive income. Instead I am relying on dividends from funds like PFFS 6%, UTG / SCYB all with a yields of 7%, pbdc 9%, EIC 11%SPYI 11%, ARDC 12%/ QQQI 13%. All with yields higher than government bonds or HYSA. So I need a lot less money to get the passive income I need to cover all of my living expense in retirement.
ARCC has beeen paying a yield of 9% for about 20 years. They have never missed a dividend payment.and the share price is consistent. UTG is just as old and pays 7% and agin has never missed a payment. This is just an example to show that yield higher yields are possible at minimal additional risk.
I invest in dividend stocks and have been buying PFFD 6% yield, UTG 6.7%, UTF 7%, SCYB 7%, PBDC 9%. SPYI 11%, ARDC 12%, QQQI 13%
I think you’d be better off investing in utility/infrastructure funds like UTF and UTG than trying to choose single stocks yourself.