How to Live Off Stocks - 6 Higher Return Strategies
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As a financial author and wealth coach I, Camille Gaines, will explain that Investment income from stocks comes from dividends as you may have seen in my other video. With the dividend yield under 2%, income investors are seeking ways to get higher income from stocks. In this video I’ll share strategies for getting higher passive stock income from dividend investing, while pointing out that I am not recommending any of them, and I am somewhat reluctant to record this since we are in yr 9 of a strong bull stock market as I record this. You’ll want to understand the cycles and risks involved in the stock market before investing. I only share what I have done or learned from investing from the past 3 decades, not financial advice.
1. REIT’s are bought and sold like stocks but are special types of funds.
REIT’s invest in real estate and allow the public to invest.
2. MLP’s are also bought and sold like stocks but are partnerships that invest in oil related of businesses.
Both REIT’s and MLP’s have higher yields than the stock market in general.
3. Stocks that are considered riskier also pay higher dividend yields. For example, AT&T yields over 5% now.
4. There are 2 main types of dividends, common and preferred. There are several differences but one major difference you’ll want to know is that Preferred dividends get paid before common dividends if the company has to stop paying dividends due to problems, even though they often pay more dividends than common stocks.
5. Call options – Sometimes investors, and a lot of fund managers, sell call options to increase the investment income from stocks. A few financial advisors sell call options for their clients, but it’s a lot of extra work since they have multiple clients and managing covered calls for many clients can be a lot of work. It’s not hard for individuals to manage covered calls in their own account since it is one account. CC’s can add 6 to up to 30% a year or more in income. In general, covered calls work best in bull stock markets.
6. Certain funds, financial advisors and wealth managers have strategies that are focused on income more than an increase in value. These funds may use leverage, or may invest in riskier stocks, MLP’s, REIT’s or a combination of these investment income strategies.
One thing to remember is that when we enter into a stock bar market, the value of most stocks drop. Sometimes stocks that pay dividends don’t drop as much, however. It’s always important to know your stock drop factor, as I explain in another video.
Unfortunately, you can’t get much passive income from stocks right now since interest rates are so low. This is what led us to create income streams from different sources so we could maintain our standard of living, and even retire early.
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This is financial education only and is not to be taken as personal financial advice since everyone’s situation is different. Learn personal finance and investing basics so you can embrace and lead your wealth with confidence!
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Camille Gaines
Financial Coach
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Yikes! Watch my Retirement Income from $1,000,000 Investment Account video here: • Retirement Income from $1,000,000
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I really appreciate you watching. Thank you:)
All the Best,
Camille Gaines
• How to Live Off Stocks - 6 Higher Return S...