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Investing in dividend stocks is an effective way to secure a reliable income during retirement. A study from Ned Davis Research showed that stocks returned about 8.8% annually in aggregate between 1972 and 2012, compared to a return of only 1.6% for non-dividend stocks.
But which stocks are reliable enough to survive entirely on dividends? Let’s move on to the topic of ideas.
In December of last year, someone posted a poll on r/Dividends — an investor discussion board on Reddit with 666 members — asking if any retirees were living entirely off dividends. The post has received over 200 responses with many interesting stories of retirees living off income sharing.
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One investor said he was always “very comfortable” on stocks and social security. He earned more than $160,000 in shares annually and had a portfolio yield of 4.5%.
“We have an increasing amount of money and the amount of money that keeps growing because of faith and we give back 10 percent of our profits,” he said.
When asked what he did for a living, the investor said he and his wife earned “above-average” income.
“We also put three kids through college debt-free. I always pondered the advice I was given years ago: It doesn’t matter how you make your money; it’s what you do with it that counts.”
During the discussion, the advertiser revealed his top 20 contacts. Let’s examine some of these stocks.
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PHistory of mbina Pipeline Corporation
Pembina Pipeline Corporation (PBA) is a Canadian transportation and logistics company. Its distribution is about 4.9%, according to Benzinga Pro. The investor, who earned $160,000 a year in shares, said the PBA was among his biggest positions. The stock has gained about 18% this year.
Realty Income
Realty Income Corporation (O) is one of the most popular monthly dividend stocks. The REIT has raised its dividends for 30 straight years. However, the stock is down 4.5% so far this year. The possibility of tariffs from the president, Mr. Donald Trump, against China, is causing problems in the stores as most of the company’s tenants are traders who import goods from China.
Johnson & Johnson
Johnson & Johnson (JNJ) was among the largest investors. He made a beef during the interview:
“I think that JNJ is at an attractive entry price for new investors. I already have 1,100 shares, so I don’t want it to increase the amount of my money. JNJ’s money is now depressed because of the lawsuit. It is a mammoth company and it will come with this. No court will seriously affect their business outlook are long-term and are buying for yield.”
Over the past year, the stock has lost 5% of its value.
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Iron Mountain
Iron Mountain Incorporated (IRM) is a data storage REIT that provides physical storage solutions for documents and records. Its customers are large enterprises with data security and information management needs. The company makes money through long-term rental agreements. The company Benzinga Pro paid 2.42 %.
WP Carey
The investor to get $160,000 in annual dividend income said WP Carey Inc. (NYSE: WPC) was among his top positions. WP Carey Inc. is one of the largest rental network REITs, managing more than 1,200 properties in the US, Europe and other parts of the world. Retail stores, restaurants, car companies and grocery stores are among the REIT’s tenants.
Procter & Gamble
Procter & Gamble Co (NYSE: PG ) has raised 68 consecutive shares and has a yield of 2.3%, according to Benzinga Pro. The amount has increased by 20% in the last year.
BlackRock
Investment giant BlackRock Inc. (NYSE:BLK) was also part of the retired pilot’s portfolio. BlackRock’s dividend has seen 9.5% annual growth over the past five years. As of 2023, the company has increased its payout for 14 straight years.
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History of Entergy Corporation
Electric power generation and distribution company Entergy Corporation (ETR) was among the top holdings of the retired investor living off shares. Entergy shares are up 50% this year. It recently made news after Meta Platforms said it plans to spend $10 billion to build an AI data center in Louisiana. Meta will work with Entergy to secure the data center.
OGE Energy
Oklahoma-based utility company OGE Energy Corp. (OGE) was also part of the portfolio generating $160,000 in annual dividend income.
IBM
International Business Machines Corporation (IBM) has raised its earnings for 29 consecutive years. The stock has gained about 45% this year.
Starwood Property Trust Inc. (NYSE:STWD) is a Connecticut-based REIT focused on commercial mortgage loans and equity investments. Its distribution reaches 9.6%, according to Benzinga Pro.
Prologis
San Francisco-based REIT Prologis Inc. (NYSE:PLD) paid 3.3% per share last time and the annual dividend yield was 3.3%. Saudi Arabia’s sovereign wealth fund increased its stake in the company by 34.5% to 1.55 million shares in the third quarter.
Low interest rates mean that some investments will not yield what they did in previous months, but you don’t have to lose them. Some private real estate investment markets are offering retail investors the opportunity to capitalize on these high-yield opportunities.
The company Arrived Home’s Private Credit Fund’s paid 8.1 %.which provides access to a pool of short-term loans backed by housing. The best part? Unlike other private loan funds, this one has a minimum investment of only $100.
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The article Retired Investor Lives Off $160,000 In Dividends Shares Stock Portfolio – ‘We Live Safely On Shares’ originally appeared on Benzinga.com
