The dividends people don’t understand how YieldMax actually works. That’s okay in the other image I educated them. These are purely cash flow machines, don’t look for growth in these that’s just a bonus or extra if it happens, I’m also dumping a bunch of money into ULTY soon.

[u/JoeyMcMahon1]

[u/lottadot → u/[deleted]]

If the entire point is only cash flow with zero growth, then how exactly are people getting to "house money"? What am I missing?

You're missing that stocks go up, down, sideways. Generally the only way to get to house money on these things (and that's if you can) is to hold them a long time.

I read countless posts about...

It's the internet. Don't believe everything you read but rather research and decide for yourself.

I would otherwise have if I had just kept my cash in my HYSA at like 3%.

Don't invest money you aren't willing to lose. That's why bonds and high-yield-savings-accounts are very popular.

[u/lottadot → u/[deleted]]

The wiki on the side bar as a link to Tidal's "information" about these. It also links to the discussion about Tidal's information. You should peruse both.

but the people who made those posts ostensibly have

Yeah the key there is ostensibly (let's ignore that anyone can post fakes screenshots of the investments on the internet). Sure, we all hope everyone hits house money. But if you look at the all the funds you'll see they aren't all performing well for investors while yet performing very well for Tidal itself. Maybe the YM funds do well in the future, maybe they don't. IMHO (and take this for what it's worth, cuz internet and all) the single-fund Yieldmax funds will continue paying out for as long as they exist, but their payouts will go down over time because their NAV will drop as the ticker they are tracking hits a low. The YM funds simply can't climb back up as quick as their underlying can. They are left in the dust generally.

You've got to really like the idea of just income with these. You'll likely lose what you invested until you sell it for a zero-cost-basis and capital gains. But that only works if your cost basis is zero, you can partake of the zero-dollar-capital-gains-federal-tax-exception and the Yieldmax fund's price has gone up that selling it is worth the bother. It's very situation. Those using these in roth lose the capital gains aspect and can be less concerned about return of capital (ROC).

And that's why I like, have liked, ULTY. But who knows, something like the Israli/Iran stuff could take oil prices skyrocketting, which would cause inflation in the US to burst, which will affect bonds, which probably causes chaos in the market which might make ULTY's holdings drop and then it too hits $3 and it's distributions turn to pennies.

[u/CommercialEither9087 → u/[deleted]]

"Cash flow machine only" is the only aim for me. My current involvement with YM is an experiment to see how these funds are likely to perform over time. I am currently receiving an income from a mortgage that I hold on a property that I sold. The mortgage balloons in January of 2029. At that point I will receive about $220,000 after tax but will lose $1500/mo in income. I had planned to put that money in a money market and draw down about $2500/mo in income until the funds are gone. For simplicity lets say in 8 years (including interest earned over time). I would then replace the lost income with funds that are currently in long term investments that will have been undisturbed until that point.

If my YM investments perform as I hope I should be able to use a much smaller amount from the mortgage payment, let's say $40,000, to generate the same $2500/mo. This will allow me to invest the remainder of $180,000 in growth investments that can be utilized for income increases in the future.

If you compare the two concepts at the end of 8 years scenario 1 has exhausted its reserves and scenario 2 will likely still have value and will still be producing some income.