If you're a regular reader of StreetAuthority, you know I love
getting -- and reinvesting --dividend paychecks.
Simplyput , my goal is to earn a paycheck every day of the month
by owning a basket of solidincome securities -- and then grow the
size of those paychecks by harnessing the power ofcompounding
So far, the results have been very rewarding. From an initial
$200,000investment , I'm earning nearly $16,000 in dividends ayear
(or more than $1,300 a month) using this strategy. And that doesn't
even include a penny from the healthycapital gains I've made from
most of my holdings.
But as I said, you may have already heard this before. My goal
today is to show you how to get the most out of yourincome
investments using a simple yet effective three-part strategy.
Icall it the
, and it's the cornerstone of my advisory,
The Daily Paycheck
. The great thing about the Dividend Trifecta is that it's fully
customizable to your own needs. You can use it to multiply
yourwealth over time, preservecapital -- even bring in a
secondincome tofund your retirement.
Here's how it works...
I have three separate portfolios within
The Daily Paycheck
, and each helps me achieve one part of the Dividend Trifecta
portfolio offers higher yields but is a bit riskier when it comes
tocapital preservation. The yields here start at about 7.5% and go
up from there. Some of thesestocks andfunds yield 10% or more.
Although these are riskier, I take special care to choose only
those securities thatoffer ample reward for the risk. Many of my
high-yield holdings are long-established closed-endfunds ,
specializing in everything from utilities andreal estate to
Fast Dividend Growers
portfolio has the lowest yield of the three portfolios. But what it
lacks inincome it makes up for in priceappreciation (the average
total return for thesestocks is 58%). Thesestocks are
increasingdividend payments by up to 15% ayear -- making them
perfect if you want a rising stream ofincome but also the potential
for heftycapital gains in the process.
portfolio is full of dependable dividend-paying securities. These
are some of the most reliabledividend payers on Earth. If you're a
conservative investor, then theseinvestments can deliver consistent
dividends -- no matter what happens in themarket .
When you own all three types of theseincome investments and
reinvest the dividends, you can see some pretty dramatic results.
I've received more than
$47,000 individend paychecks
so far in less than 42 months. But because I reinvested, my
portfolios are now worth over $290,000 -- nearly a 46% total return
My three portfolios work together, producing the characteristics
I'm looking for -- an overall approach that minimizes volatility
andcapital risk while maximizing my monthlyincome .
I've now spent more than three years using this strategy. I love
its simplicity. My dividends get reinvested every month without me
having to lift a finger. Overall, the portfolio has been roughly
40% less volatile than the overallmarket . To me, that represents
40% more sleep-filled nights.
The Investing Answer:
Your needs may be different than mine. The good news is that this
strategy is fully scalable to any size portfolio and can be easily
If, for instance, you have less tolerance forcapital losses in
the shortterm , youwill want to own a smaller percentage of
High-Yield Opportunities holdings in your personal portfolio. If
you have a very longinvestment horizon and have lowerincome needs,
you may want to hold a higher percentage of Fast Dividend Growers.
And if you have a need for stable currentincome right now, then you
are likely to find that SteadyIncome Generatorswill meet your
Before I started using this strategy, I was anxious about
creating a portfolio that couldsupport me once I retired. I'm no
longer anxious. My Dividend Trifecta strategy is generating more
and moreincome every month. And I know that when retirement comes,
I can just flick off thedividend reinvestment switch and start
living off theincome .
That's the kind of experience I want every
reader to have.
P.S. -- There is plenty more to share about my Dividend Trifecta
strategy, but I don't have the space to include it all here. That's
why I've put together a special presentation that outlines how I
find investments that allow me to earn $16,000 per year in extra
income. To view this presentation -- and get the names and ticker
symbols of a few high-yield picks to start your own "Daily
Paycheck" portfolio -- click here.
This story originally ran at StreetAuthority.com:
My 3-Part Strategy For Collecting $47,000 In Dividend Checks