For 10 years, I’ve published such a portfolio in Kiplinger’s Investing for Income (kiplinger.com/go/aboutkii). The idea is to assemble 12 stocks or funds with alternating distribution dates so that you never wait long for cash. This strategy can be a complement to a bond ladder, another time-tested tool for putting cash flow on autopilot.
Because share prices are soaring, the current yields on some former dividend favorites have dipped well below 2%. However, many other dividend aces still yield at or above 3%, headed by AT&T’s 6.9%. So, with the full S&P 500 index priced to yield just 1.4% (down from 2.4% a year ago), let me recast the Dividend-a-Month portfolio into a high-yield edition whose 12 elements average 3% or better on new money. Capital is spread over numerous sectors—a critical diversification advantage over an undisciplined chase for maximum yield. And you have growth opportunities.
This story is from the June 2021 edition of Kiplinger's Personal Finance.
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This story is from the June 2021 edition of Kiplinger's Personal Finance.
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