Dividend Income From $100,000 (Not What You Think)

How much

dividend

income

will one hundred thousand dollars generate? One hundred thousand dollars is a great start to a retirement portfolio if you're younger, but how much money can you expect to receive from that much capital? Would it be enough to finance your car payment coverage? your mortgage payment or maybe even enough to cover the

income

needed for retirement, maybe it would be enough to give you peace of mind seeing regular income coming into your account regardless of whether you are working or not, depending on your style investment, you might be surprised. how much you would receive from a 100,000 account, see how much

dividend

income you could generate, and learn how you can maximize profits to reach your goals faster.

My name is Chris and I help teach people about money, personal finance, and investing. If you are interested in improving your financial future, be sure to subscribe to the channel and hit the like button. If this video is helpful, it goes without saying that the amount of income you will receive will depend on where your money is parked that you could invest. A general broad market index fund that will track the entire SP 500; You could buy individual dividend stocks to maximize income growth or you could buy a combination of both. Dividend yields will vary depending on the aggressiveness of your portfolio and should ultimately depend on how long until you retire you don't want them to invest. , they are only income investments long before your projected retirement date simply because the overall returns are lower with dividend paying stocks, this is because they are not fast growing companies but older blue chip, high income alternatives .

It's nice to have, but ultimately irrelevant for younger investors. If you invest all of your $100k in a fund that tracks the 500, you could expect an average amount of dividend income, meaning it won't be geared toward income or growth, but rather a combination. Since you are buying at the market, your overall income and returns, including capital appreciation, will be average. Currently, the S P 500 has a dividend yield of about 1.5 percent, meaning you would receive 1,500 per year or an average of 125 per month in dividend income payments. They are usually made quarterly, which would be equivalent to $375 every quarter or every three months, while the dividend yield is not particularly high.

Overall performance averages about 10 percent annually. Receiving this type of dividend income is ideal for the average investor because it provides a near perfect combination of income and growth - even if someone were to spend all of their dividend payments, they would still see considerable investment growth over time to achieve a higher growth rate but lower dividend income. One could choose to invest in a S P 500. Growth Fund A fund like this would hold the fastest growing companies that are within the S P 500. This is great for people who do not plan to retire for quite some time and are not dependent on their dividends, the yield will probably only be around point five percent because many of the holdings are technology companies that pay little or no dividends with a hundred thousand dollar investment representing only five hundred dollars a year, forty-one dollars a month or $125 a quarter in dividend income, although that's pretty paltry.

Capital appreciation will be higher than average as the companies are fast growing businesses like Apple, Microsoft, Tesla, Nvidia and Google. These companies have very small dividends, if any, because they prefer to grow the business rather than distribute income to shareholders, since dividend income is only one. a third of the s p 500 you would need three times the invested capital to receive the same amount of income, but since growth is high, you could reach that figure much more quickly if something you would like to achieve is higher dividend income and you don't. you do. If you don't mind a lower overall rate of return, you might consider purchasing a fund that is specifically designed to provide above-average dividend income.

A good example of this type of fund is SPDR's S P 500 High Dividend ETF. Own companies that have the highest dividend yields. Included in the SP 500, these funds almost always experience slow capital appreciation because the companies they own focus on generating consistent profits and income for shareholders rather than trying to scale. Keep in mind that even when dividend payments are considered, yields will likely be lower than higher. growth alternative, which is why this type of investment is generally only recommended for those who need retirement income immediately and don't have time to watch investments grow over time before receiving income.

Some investors choose to buy single dividend stocks that meet their criteria. Each one has his own. preferences in terms of a stock's characteristics, but dividend investors generally look for those with a track record of dividend growth. They also want future dividend growth, as well as a company with growing earnings and earnings to ensure its share price rises, as well as a yielding dividend stock. 10 percent but losing 20 percent of its stock price each year is a poor investment, but many novice investors are attracted to extremely high returns. Individual stocks are the riskiest option but also allow for greater upside as stock prices move independently, it is easy to spot a particular stock that is on sale for various reasons, on the other hand, some stocks are equally overvalued. , it is difficult to get a deal when buying funds because all stocks are priced together, the ability to buy an individual stock on sale is most attractive to investors.

Think of it like buying a fixer-upper that is way underpriced. of market value with huge advantages: it's easy to get that run-down house for sale while the pristine property on the other side of town commands a higher price. An example of a single dividend stock is Iron Mountain, its business is storing, protecting and managing information and assets. It is one of the highest-performing stocks in the SP 500 due to the fact that it is a mutual fund, which is typically the highest-performing type of stock. It pays a dividend of 7, which means you would receive seven thousand dollars a year or about five hundred and eighty dollars a month in dividend income, which is quite a considerable amount and hopefully the share price will continue to rise.

The returns to investors are good capital appreciation and their earnings don't grow as much in comparison. its peers, but the dividend income is the reason most would own it well, it is not recommended that you accumulate your entire portfolio into a single mountain of iron is a good example of

what

you could potentially buy and receive a good amount of income for doing absolutely nothing. Additionally, if you have a portfolio consisting of perhaps 10 quality stocks, the chances of one of them being for sale at any given time are high, so you can always get a lot of dividend income generated by a portfolio.

Of this size. That's exactly a lot of money, that's not to say that some people wouldn't be comfortable with this amount combined with another source of income, like a part-time job or perhaps social security income, considering that the average benefit of Social security is approximately fifteen hundred. dollars per month, another hundreds of dollars in spending money is attractive, perhaps a couple with a house paid off and low expenses could live happily on social security, plus some dividend income, if a retiree works part time 20 hours per week at 13 per hour i.e. around 1,000 per month and it would be nice to add dividend income, otherwise it might be enough to cover transport costs, a holiday fund or even a small mortgage payment, although these income is not particularly high.

The dividends reinvested over time can be enormous. Dividend investing has increased interest among younger investors, but they should consider their goals to determine the best strategy that will provide them with the most money when they decide to use it for income investing. investments something that follows the general market or growth investments that tend to outperform the market a broad market fund like the s p 500 could be the best of both worlds consider the amount of dividend income you could expect to receive from these different types of investments Then you will have an idea of ​​the investment strategy to implement and the amount of money necessary to achieve those income goals.