What the AT&T Dividend Cut Really Means (and 3 Huge Dividends to Buy Instead)

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The once unthinkable has happened: AT&T (T), a Dividend Aristocrat that increased payouts for 30 years, said it will cut its payout nearly in half.

The move is especially infuriating because, as recently as April, we were hearing a lot about why the company would likely hike its payout in 2021, and management had stood by the dividend.

That’s now out the window—and the market’s not happy.

Dividend Cut Sends AT&T on a Wild Ride

It just goes to show you that even companies among the vaunted Dividend Aristocrats fall from grace from time to time. We all remember back in 2017, when another sacred cow, General Electric (GE), slashed its payout in half, as well.… Read more

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This “stocks-up, yields-down” market is clobbering income investors. With stock prices floating higher, yields are crumbling to dust: with the 1.3% payout on the typical S&P 500 stock—a 20-year low—you’d need to invest $2.2 million to get just $2,500 a month in dividends!

(And let’s not forget that the typical S&P 500 stock pays dividends quarterly, not monthly, so your lame income stream would also be pretty lumpy!)

The 10-year Treasury note—long an income go-to—isn’t much better. With a 1.6% yield, you’d still need $1.8 mil to get that same $2,500 a month.

An Oasis in the (Dividend) Desert

Of course, none of this is a surprise to anyone who’s been investing for income over the last decade or so—it’s a slightly worse version of the same old story.… Read more

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Patriotism is rarely a good guide when making investment decisions, but these days it just might be, as Americans now have a terrific reason to buy US stocks.

That would be a surge in vaccinations that’s put the US ahead of most of the world on the road to recovery, while at the same time, US stocks are lagging behind their global competitors. This is a disconnect contrarians like us can use to position ourselves for some nice gains and big dividends in the months ahead.

US Vaccinations Ramping Up

Source: Bloomberg

Right now, we’re seeing an average of about 2.5 million doses being distributed across the US per day, meaning we could hit the bottom edge of herd immunity in about 50 days.… Read more

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I don’t know about you, but I’m ready to say farewell to this whole Reddit/GameStop (GME) situation.

But before we bid adieu to this weird market moment, we need to take just one more run around the horn, because it’s left three big benefits in its wake that no one is talking about right now.

These three hidden catalysts all point to stronger market gains in the weeks and months ahead—gains we can “convert” to 7%+ dividends when we pick up one of my favorite investments, stock-focused closed-end funds (CEFs), right now. Let’s dive in.

Reddit Gamblers’ Wins Will Go Into the Economy (and Boost Other Stocks)

The most immediate positive for the market comes from the big gains early investors in GameStop and other companies at the center of this battle enjoyed.… Read more

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You and I both know there’s a problem with the sugar high the stock market’s been on. Does it mean we should dump some of our beloved dividend stocks and try to buy them back at lower prices?

We’ll talk income strategies and market timing in a minute. First, let’s talk about these concerning behaviors exhibited by America’s odd couple, Mr. and Mrs. Market.

First up, we know a correction is coming. When a group of folks on a Reddit message board can drive one stock—GameStop (GME)—up 1,700%+ in a month, you know the market has become a bit unhinged.… Read more

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Are you trying to grind out a livable retirement on dividends alone? It’s possible, and it doesn’t require millions and millions already in the bank. (Even today, with interest rates in the tank.)

However, we must step outside the mainstream to achieve this. After all, why mess around with a standard $15,600 a year in retirement income when we can “supersize” that annual yield haul up to $108,000?

The “standard” $15.6K is what we get listening to mainstream financial advisors and pundits, and buying the vanilla ETFs that they recommend. The latter $108K is what we can achieve with a little bit of original thinking.… Read more

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I know you’re struggling to find cheap stocks to buy these days (or at least stocks that aren’t cheap for a reason!). This pullback is a bit helpful, but not enough for us dividend investors—the average S&P 500 stock yields a pathetic 1.7% as I write this.

That’s nowhere near enough dividend income to retire on, unless you’re sitting on a portfolio $2.5 million or more!

But don’t worry, there are always bargain-priced dividends out there—we just have to go a step beyond what the mainstream crowd is buying. Today I’m going to show you one such investment; it’s my favorite one to buy for big dividends and upside.… Read more

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What are we dividend investors to make of this presidential election? Are we supposed to buy now or wait to see what happens in November?

Before we get into that—and discuss a 10.7% dividend that’s very appealing preE-Day—there’s one thing we must do: set aside our personal politics and stay laser-focused on the investing angle here.

With that said, there are two things I see as likely no matter who wins this thing:

  • A post-election rally: According to Deutsche Bank global chief strategist Binky Chadha, stocks typically rally 5% from Election Day until the end of the year when an election is close, regardless of the result.

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The S&P 500 index has been “relief rallying” like crazy, but to most income investors, this means nothing. The wider the basket of stocks, the rougher the year it has been. Let’s consider that (as I’m writing this):

  • Year to date, the “big cap focused” S&P 500 is down “just” 12%. However,
  • When we weight its 500 stocks equally, its return drops to 20% YTD. And,
  • When we expand the universe to look at small cap stocks, we see the Russell 2000 is down a brutal 24% thus far in 2020:

Don’t Let the S&P 500 Fool You

Plus, we now face another problem: an income drought!… Read more

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Today we’re going to discuss six “retirement maker” funds that pay dividends up to 10.8% annually. You will not find these types of yields in mainstream financial publications. Here’s why.

It’s important for you to fade Wall Street’s advertising machine and buy value, not hype – especially when it comes to dividend payers. Stick with excellent yet off-the-beaten-trail CEFs (closed-end funds) and ignore the marketing machines promoting their latest overrated ETFs (exchange traded funds).

Please, Whatever You Do, Don’t Buy Bond ETFs

Be careful how you buy your bonds. The most popular tickers have a few fatal flaws that’ll doom you to underperformance at best, or leave you hanging in the event of a market meltdown at worst!… Read more

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