3 “Perfect” Retirement Buys for 8.6% Dividends and Fast 86% Gains

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If this were any “normal” time, we’d be able to buy safe bonds and collect enough income on our nest egg to fund our retirements. Unfortunately, this is the “new normal” where the Fed is not the friend of us current and hopeful retirees!

Jay Powell is afraid for his job, which means he’s going to cut rates and keep them low for a long time. This means we must look beyond traditional bonds for meaningful income.

What about blue chip dividend-paying stocks? Well, an 11-year stock market rally has ruined that idea. Anyone putting new money in a pricey dividend aristocrat is “buying and hoping” that the stock continues to levitate while the firm dishes its dividend.… Read more

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How much do you need to save to retire comfortably? Not as much if you think if you buy the right monthly dividend payers.

How you invest your retirement portfolio is more important than how much you have. Especially today, with “dumb” retirement money collecting just 1% in safe bonds.

That 1% won’t even get it done if you save the $1.7 million most Americans believe they need. (And don’t worry, they are wrong anyway. You don’t need nearly that much money to retire on dividends alone.)

Financial experts are incorrect, too. Here is more advice based on, well, not knowing which dividends to buy in retirement:

  • The AARP says you’ll need $1.18 million to generate $40,000 a year.

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If this were any “normal” time, we’d be able to buy safe bonds and collect enough income on our nest egg to fund our retirements. Unfortunately, this is the “new normal” where the Fed is not the friend of us current and hopeful retirees!

Jay Powell is afraid for his job, which means he’s going to cut rates and keep them low for a long time. This means we must look beyond traditional bonds for meaningful income.

What about blue chip dividend-paying stocks? Well, an 11-year stock market rally has ruined that idea. Anyone putting new money in a pricey dividend aristocrat is “buying and hoping” that the stock continues to levitate while the firm dishes its dividend.… Read more

Read More

As you near (and enter) retirement you probably favor bonds, which provide income with less drama than stocks. However, less drama means less potential upside. With retirees living longer than ever before, it’s important to not go too conservative too early in life. And fortunately today, even 65 or 70 may be too early!

One suggested solution for our long life expectancy “problem” is to stay with stocks longer. But stocks can go down as well as up and a big pullback can inflict permanent damage on a portfolio.

So, we want to capture the dividends that stocks pay and the upside potential that they provide by minimizing our downside risk.… Read more

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No safe bond pays 10% itself, of course. But it is possible to generate double-digit yields from a portfolio of secure bonds.

The secret is similar to successful dividend investing. Why buy a stock and be content pocketing “only its dividend” when you can have the payout with price upside to boot?

Most income investors are even less thoughtful when they purchase bonds. They fixate on the coupon rate (which these days they are inevitably disappointed with.) They watch their bonds weigh down their entire portfolio, muttering to themselves “at least they are safe.”

Well, sure. But they can be both safe and profitable.…
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The desperate hunt for yield is getting way out of hand—and it’s setting up a terrific buying opportunity for you and me.

How out of hand?

Consider that some investors are so income starved they’re piling into sovereign bonds from Iraq—a country that’s still a war zone!

The latest issuance of five-year bonds by the Iraqi government was slated for $1 billion. But investors spied the 7% yield on offer here and crashed the doors, racking up nearly $7 billion in orders.

It’s sad, and totally unnecessary.

A Secure Portfolio With a Life-Changing 8% Yield

The worst thing is, in their scramble for income, the herd is charging right past yields that are even bigger—and far safer—here in the U.S.A., like the ones you get in my new “8% No-Withdrawal Retirement Portfolio.”

If you’ve been reading my column over the past two Mondays, you know I’ve been giving you a hands-on tour of this portfolio, which I’ve crafted to hand you $40,000 of income on a $500,000 nest egg.…
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Is there a bond bubble? There’s certainly more froth than not, with investors recklessly reaching for the riskiest of yields.

But there’s one last 10% dividend on the board worthy of our consideration. It’s available thanks to investors’ misunderstanding (and laziness) – we’ll discuss details in a minute.

But first, let’s review three key rules that will help us navigate this budding bond bubble.

Rule #1: Maximize Your Upside

Our favorite second-level thinker Howard Marks noted in an op-ed for Barron’s that Netflix (NFLX) bond buyers – who recently scooped up €1.3 billion of Eurobonds paying just 3.625% – might have exposed themselves to significant downside without much upside.…
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