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Dividend investing is becoming increasingly popular as investors look for stability and consistent income. Reliable dividend stocks reward investors, even in tough times. According to data from BlackRock, stocks of companies that regularly increase their dividends outperformed non-growthers between 1978 and 2023.
But which dividend stocks can help you achieve a decent income level without any risks? Let’s look at a success story for some ideas.
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About two months ago, a dividend investor shared on r/Dividend (a community of over 580,000 members on Reddit) that he had reached a milestone of $1,000 per week in dividend income after 15 years of investing.
The investor said his portfolio, which generates $1,000 a week, was worth $927,892. This makes it a portfolio with a solid return of 5.6%. When asked how he amassed this wealth to invest, the Redditor said he has been running a small business (IT consulting) since 2015, and “every penny” he earned was invested in stocks, bonds, CDs, and HYSA .
“I get about $250,000 a year off from my company (before taxes),” he added.
It is also important to emphasize that the investor said he is single and has no mortgage or debt.
Someone asked the investor how much he contributed to his investment each month. Here’s the answer.
“About $5,000 a month, give or take – I’ve been able to do that for about five years now.”
The Redditor also explained the main motivation behind his investment journey:
“I remember my mother once saying that my father never had the chance to enjoy his retirement (he passed away) – that stuck with me. So if I can leave early and live a comfortable life, sign me up then on,” he said.
While not everyone can contribute $5,000 a month to investing, we can all gain inspiration and stock ideas from his success story and portfolio. Here are some of the stocks and ETFs in this high-yield dividend portfolio, which the investor has shared publicly.
Coca-cola
Coca-Cola Co (NYSE:KO) is perhaps one of the safest dividend stocks on the market, with more than six decades of consecutive dividend increases and a solid business. In late August, Morgan Stanley raised its price target on Coca-Cola Co (NYSE:KO) from $70 to $78, calling it a top pick. Morgan Stanley believes the company is well positioned to deliver strong organic revenue compared to industry peers.
Wendy’s
It’s not common to see Wendy’s Co (NASDAQ:WEN) in Redditors’ portfolios that generate long-term dividend income. However, the Redditor who earned about $1,000 a week in dividends said the fast food chain’s shares were among his notable holdings. WEN yields approximately 5.7%.
PepsiCo
PepsiCo Inc. (NASDAQ:PEP) has a dividend yield of approximately 3.2% and more than 50 consecutive years of dividend increases. Like Coca-Cola, it is considered a defensive stock that investors love in all market cycles. The Redditor who earned $1,000 weekly in dividends named PEP as one of his notable stock holdings.
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Nuveen Preferred & Income Opportunities Fund
Nuveen Preferred & Income Opportunities Fund (NYSE:JPC) invests primarily in stocks and other income-generating investments, including bonds. The fund’s top holdings include Barclays, JPMorgan, Wells Fargo and Truist. JPC pays monthly dividends and delivers a yield of more than 7%.
JPMorgan Equity Premium Income ETF
JPMorgan Equity Premium Income ETF (NYSE:JEPI) has become a no-brainer investment among Redditors looking to invest in dividend ETFs for the long term. JEPI makes money by investing in some of the most notable large-cap U.S. stocks and selling call options. JEPI is ideal for those looking for exposure to defensive stocks. JEPI usually underperforms during bull markets, but protects investors from huge losses during bear markets as most of the portfolio consists of large, defensive stocks such as Trane Technologies PLC (NYSE:TT), Southern Co (NYSE:SO), Progressive Corp ( NYSE:PGR), among many others.
The fund pays out monthly dividends and yields approximately 7%.
JPMorgan Nasdaq Equity Premium Income ETF
The Redditor, who earned $1,000 per week in dividends, ranked the JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ:JEPQ) among the best ETFs in his portfolio. JEPQ invests in Nasdaq companies and generates additional income through the sale of call options. As of October 2, the ETF returned about 9%.
Nuveen Floating Rate Income Fund
Nuveen Floating Rate Income Fund (NYSE:JFR) is a floating rate income fund that generates income by investing in floating rate loans. The fund yields approximately 11%. However, variable rate funds tend to be attractive when interest rates rise.
Schwab US Dividend Equity ETF
The Redditor, who earned about $1,000 a week in dividends, said he owned just 118 shares of Schwab US Dividend Equity ETF (NYSE:SCHD). The ETF tracks the Dow Jones US Dividend 100 Index and gives you exposure to some of the best dividend stocks trading in the US, including Home Depot, Coca-Cola, Verizon, Lockheed Martin, Pepsi and AbbVie, among others.
Wondering if your investments could earn you a $5,000,000 nest egg? Talk to a financial advisor today. SmartAsset’s free tool matches you with up to three vetted financial advisors serving your region, and you can interview your advisors for free to decide which one is right for you.
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This article 49-Year-Old Earns $1,000 a Week in Dividends with a Stock Portfolio of $927,892: Top 8 Stocks and ETFs originally appeared on Benzinga.com
