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Passive income through dividends

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tomasz
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Passive income through dividends

Post by tomasz » June 17th, 2013, 12:08 am

I searched on the forums but could not find any info or discussions.

Has anyone here invested in stocks that pay out dividends and lived on some or all the funds generated from that? I know it takes a while to build up a big next egg but I just want to hear from anyone who has done it and what was their strategy and experience.




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fschmidt
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Post by fschmidt » June 17th, 2013, 1:13 am

This is extremely difficult because the world is in economic decline which means that the average real return on most investments will be negative. Many stocks that pay dividends may go bankrupt in an economic crisis. I believe that there is one class of stock which is particularly promising which I have been watching which I discussed here:

viewtopic.php?t=18487

I have been living on my investments for the last 10 years or so, mostly returns from stock market gains, but I don't think my strategies of the past will work in the future.

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Adama
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Post by Adama » June 17th, 2013, 2:54 am

I think you would need a few million dollars invested to actually have a dividend income large enough to live on.
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xiongmao
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Post by xiongmao » June 17th, 2013, 3:11 am

I've got quite a bit invested, my dividends paid my rent in China.

I bought mainly covered call funds and high yielding bond funds. I was getting around 7% on a few funds. I also bought stuff a while ago while the markets were low and stuff was yielding 13% or more.
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MrPeabody
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Post by MrPeabody » June 17th, 2013, 3:58 am

Everyone is in the same boat. The Fed has basically made money free so you can’t even make enough interest to cover inflation. If you go to dividends, you are putting your principal at risk – so the trade off is you are forced to take on risk in order to get greater returns. Now most people can’t afford to retire.

Contrarian Expatriate
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Post by Contrarian Expatriate » June 17th, 2013, 4:55 am

If you want passive income to live on, invest in foreign CDs that have high interest rates. Stock dividends are negligible in volume.

tomasz
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Post by tomasz » June 18th, 2013, 7:03 pm

Thanks for your responses everyone.

@Contrarian Expatriate
How does a canadian invest in foreign CD's and through what platform?

@xiongmao
I bet you need a pretty big nest egg to have enough passive income to live off, I am calculating around 100K, depending on your yield?

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