Forget todayaEURtms pathetic Treasury rates. And forget the lousy payout on your typical S&P 500 name, too.
Put your nest egg in either and youaEURtmre locking in an income stream thataEURtms actually less than zero for years to come!
I know that sounds crazyaEUR"IaEURtmll get into precisely what I mean, and how it could jeopardize your golden yearsaEUR"shortly. Then IaEURtmll show you my two-step dividend strategy (and four specific stocks and funds you can buy now).
Put all four of these picks together and youaEURtmve got a perfect setup for these days of miserly yields, giving you gaudy 6.1%+ payouts today and an incredible 20%+ cash stream in short order!
How Powell Crushed Savers
First, if youaEURtmre disappointed in the dividend options out there today, you can blame one man: Jay Powell. (Actually, youaEURtmll have to get in line to dump your frustrations on the poor fellowaEURtms head!)
We all know that PowellaEURtms clumsy aEURoepivotaEUR from rate hikes to rate cuts at the start of 2019 sent stocks soaring (and dividend yields plungingaEUR"as you calculate yield by dividing a companyaEURtms annual dividend payout into is current share price). PowellaEURtms lurch also sent the yield on the 10-year Treasury note (in orange below) crashing.
PowellaEURtms Mr. Bean Act Leaves Yields Cold
And now weaEURtmre staring down the boogeyman of negative interest rates.
Think it canaEURtmt happen? ThereaEURtms already $16 trillion in debt sloshing around the world yielding less than zero.
Yields could have a minus sign in front of them in America next, especially if an economic pullback sends the Federal Reserve on a stimulative turn. Former Fed Chair Alan Greenspan recently said: aEURoeYouaEURtmre seeing [negative] rates pretty much throughout the world. ItaEURtms only a matter of time before theyaEURtmre in the United States.aEUR
Imagine buying a Treasury note now and, 10 years on, getting back less than you put in! ItaEURtms a recipe for retirement poverty. And itaEURtms made the aEURoedividend two-stepaEUR IaEURtmll show you now even more urgent.
LetaEURtms start with aEUR
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.