These 9% Dividends Are Usually “Millionaires Only.” No More.

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These 9% Dividends Are Usually “Millionaires Only.” No More.

It’s Tax Day—the perfect time to talk about one of our favorite income plays: municipal bonds.

Don’t listen to anyone who tells you “munis” are boring. They’re anything but: It’s easy to grab 5%+ yields from them. And because munis’ income is tax-free for most Americans, that 5% is worth more—in some cases a lot more—to us.

They’re stable, too. Consider how much better you’d have slept at night if you held munis during the 2022 nightmare, when they held up much better than stocks:

2022 Put Muni Bonds’ “Crash Resistance” on Display

Truth is, yearly declines of any sort are unusual for munis, which tend to deliver 5% to 6% annual total returns in the long run—and that’s before their tax benefits, which are, quite frankly, game-changing.… Read more

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These 9% Dividends Are Usually “Millionaires Only.” No More.

It’s Tax Day—the perfect time to talk about one of our favorite income plays: municipal bonds.

Don’t listen to anyone who tells you “munis” are boring. They’re anything but: It’s easy to grab 5%+ yields from them. And because munis’ income is tax-free for most Americans, that 5% is worth more—in some cases a lot more—to us.

They’re stable, too. Consider how much better you’d have slept at night if you held munis during the 2022 nightmare, when they held up much better than stocks:

2022 Put Muni Bonds’ “Crash Resistance” on Display

Truth is, yearly declines of any sort are unusual for munis, which tend to deliver 5% to 6% annual total returns in the long run—and that’s before their tax benefits, which are, quite frankly, game-changing.… Read more

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Why the Coming “Yield Crash” Will Send These 8%+ Payers Soaring

This market bounce is strangling the payouts on everybody’s favorite ETFs. But it’s also given us a sweet setup to grab another group of funds kicking out big payouts, to the tune of 8%+ yields.

Even better, many of these funds—wallflowers to “popular-kid” ETFs—were left off the invite list for the 2023 market party. That means they’re (still) cheap today.

I know an 8% payout has a lot of appeal to most folks, with Treasury yields now yielding around 4.3%. That’s not bad, but it doesn’t leave you much after you account for still-elevated inflation.

And if your cash is stuck in an ETF, you’re getting a lame payout, well, almost all the time, but especially if you buy now: the SPDR S&P 500 ETF Trust (SPY)—which, as the name says, holds the entire S&P 500 index—yields a sorry 1.3% as I write this.… Read more

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Let’s “Convert” Our Lame ETF Dividends Into Ironclad 8%+ Payouts

This market bounce is strangling the payouts on everybody’s favorite ETFs. But it’s also given us a sweet setup to grab another group of funds kicking out big dividends, to the tune of 9%+ yields.

Even better, many of these funds—wallflowers to “popular-kid” ETFs—were left off the invite list for the 2023 market party. That means they’re (still) cheap today.

I know a 9% payout has a lot of appeal to most folks, with Treasury yields now down to around 4%, not too far above inflation.

And if your cash is stuck in an ETF, you’re getting a lame payout, well, almost all the time, but especially if you buy now: the SPDR S&P 500 ETF Trust (SPY)—which, as the name says, holds the entire S&P 500 index—yields a sorry 1.4% as I write this.… Read more

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A 7.9% Dividend With No Taxes? This Ticker Does That (and More)

Today we’re going to use a simple strategy to (legally!) beat the tax man. The key is a (too) often-ignored group of funds whose dividends are beyond the reach of the IRS.

The low-risk assets behind this income stream really should be part of any income investor’s portfolio. And the three tickers we’ll discuss below, which yield up to 7.9%, are a great place to start. Thanks to their tax-free status, their “real” yields will likely be considerably more for us.

Enter “Boring But Beautiful” Municipal Bond Funds

Here’s the truth on taxes: If you’re an American and you receive any kind of income, you’re going to get taxed.… Read more

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3 Bargain Funds Yielding 7.5%+ (Perfect for 2023)

We’ve got plenty of high-quality dividends on the table as we roll into 2023. Some of the best? Closed-end funds (CEFs) yielding north of 7.5%. Three specific names and tickers are coming up for you below.

I mention quality because if 2022 has showed us anything, it’s that quality matters: crypto and profitless tech got clobbered this year, and that was no one-off. With interest rates rising, these gambles—I say “gambles” because buying these was always more like a trip to the slot machines than investing—are likely down for the count.

You can see this in the performance of the NASDAQ 100, which is down some 28% year to date, as well-run, high-cash-flow companies like Apple (AAPL) and Microsoft (MSFT) were dragged down by basket cases like Meta Platforms (META) and its money-bleeding investments in the metaverse.… Read more

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This Safe 4.5% Tax-Free Dividend Will Never Be Cheaper

We’ve got a pullback-driven (and tax-free!) dividend opportunity waiting for us now, and we can thank the Fed’s looming rate hikes for it. It’s a “safety first” closed-end fund (CEF) paying a 4.5% tax-free dividend and trading at a rare 8.4% discount to its “true” value.

This opportunity comes our way through municipal bonds, or “munis.” If you follow the market for these bonds, which are issued by state and local governments to fund infrastructure projects, you know that they’ve pulled back this year:

Munis Slip, Giving Us an “In”

A 2.9% drop, as we see here in the iShares National Muni Bond ETF (MUB), the benchmark ETF for the space, is small compared to the much bigger declines in stocks, but this is pretty rare: as an asset class, muni bonds are less volatile than other kinds of bonds, let alone stocks, which is why any short-term drop tends to be a buying opportunity.… Read more

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These Ignored 6.5% Dividends Will Be the Biggest Story of 2021

A wild year like 2020 is a great acid test for closed-end funds (CEFs)—and it can tell us a lot about which of these high-yield plays to pick (and avoid!) as we move deeper into 2021.

A Split Market

If 2020 did anything, it widened the gap between winning and losing sectors of the stock (and closed-end fund) market. It just goes to show how critical it is to pick funds in the right sectors, as well as those with savvy management that can shift with the times.

Technology, of course, boomed last year. At my CEF Insider service, we were well-positioned in tech with the BlackRock Science and Technology Fund (BST), which we added to our portfolio in August 2019.… Read more

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5% Dividends, $0 in Tax: Here’s How

There are, as I write this, 3 high-yielding funds giving investors over 5% in dividend income. Plus they pay out every month, tax-free.

All 3 sold off at the end of 2017. And I’m watching one group of investors who are waiting to buy back in when a “time limit” I’ll explain in a moment expires in the next few weeks.

That makes now a good time to buy. Because when this “deadline” comes and goes, I expect all 3 of these funds to rise.

Before I show you these funds, I want to give you the inside scoop on this unique situation.…
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How to Double Your Bond Returns

Don’t be cheap when you buy bonds this holiday season (or ever, for that matter). Bargain shoppers, sadly, tend to be the most at-risk of outliving their fixed income portfolios!

But it’s easy for you and me to double up “regular” bond returns simply by swapping out popularity for quality.

Let’s walk through some of the most popular fixed-income plays today – and replace each with something that yields more (with superior price upside to boot).

The obsession with fees is understandable. Most investors are conditioned by their experience with stock-based mutual funds and ETFs to search out the lowest fees, almost to a fault.…
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