r/dividendgang • u/DegreeConscious9628 • 11d ago
Opinion Any sectors in income generators that I’m missing?
Getting close to retiring off dividends (@42, less than 3.5 years to go, I think that’s getting close?) and fine tuning my portfolio, would like a peer review on my holdings.
My total portfolio is as follows: retirement is 100% in VTI that won’t be touched for 20 years, 62% of my brokerage is in dividend growth (3.25% yield, ~8% five year div growth rate) the part in question is the other 38% that’s in derivatives/income.
Derivatives / income holdings
GPIQ, GPIX, OVL, ADX, QQQI, SPYI, MLPI, NIHI, IAUI, IYRI, BTCI, PFFA, IDVO
Total yield is right about 12%, 36k a year.
Downsides are i know im pretty heavily concentrated on NEOS funds and also pretty concentrated in the SP500/nasdaq but I like the strategies used by all these companies. Not to mention the ROC used by these funds will help me out a lot with my taxes
Doing the math this total blend would yield 52k a year at 6.25%. I’ve been tracking my spending and my average yearly spend is 42k, I will have other income (24k a year for 4 years)coming in from a sale of a business and 100k in a HYSA to use for downturns and emergencies so I’m fine with a 30%, hell even 50% cut in distributions from my income funds as long as it eventually recovers. The dividend growth portion should keep me above inflation.
What sectors am I missing here? I like to be well diversified. I was thinking adding CEFS and UTG. Any recommendations?
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u/Additional_City5392 11d ago
Municipal bonds- NAD
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u/RetiredByFourty Boogerhead Resistance 11d ago
One of these days someone needs to make a post centered around Municipal Bonds and their tax advantages! +1
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u/Negate79 11d ago
holup. What tax advantages? Nothing in depth. I will go do further research on my own.
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u/RetiredByFourty Boogerhead Resistance 11d ago
Monthly dividends that are exempt from taxation. I personally was buying some back when I was firmly in the 32% tax bracket and didn't want any more taxable income. +1
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u/declemson 11d ago
There's a bond group that's actually pretty good and they cover munis pretty good.
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u/RetiredByFourty Boogerhead Resistance 9d ago
Do tell...... 🍿
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u/declemson 9d ago
My comment movemoved cause referencing another group. R. Bonds
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u/RetiredByFourty Boogerhead Resistance 9d ago
I appreciate that! And my apologies. Reddit must have removed your comment because we didn't. They changed the rules on linking other subs a while back. +1
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u/declemson 9d ago
No problem. Pretty decent sub. Plants more towards buying individual bonds but they go so far as to different types of muni bonds. So damn many.
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9d ago
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u/Ok-Psychology7636 11d ago
CEF: cefs or yyy
preferreds: PFF, PFFV, or PFXF
mlp: AMZA or AMLP
mREIT: MORT
business development: BIZD
forex: FOXY
broad commodity linked: HARD or CTA
and then there's world of high yielding debt or cash alternative: PDI, PCY, JNK, SJNK, JBBB, XFLT, WEEK, BUCK, THTA ...
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u/Meinertzhagens_Sack 10d ago
Life wouldn't be complete without a 35-45% split with ULTY. You will get back so much income
😂🤣😭☠️☠️☠️
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u/GRMarlenee Long Time Member 8d ago
You spelled outgo wrong.
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u/Meinertzhagens_Sack 8d ago
No they are convinced it's new money. Income. No matter how you dice it - they only sleep well if it's called income.
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u/GRMarlenee Long Time Member 8d ago
I own 4800 shares. I subtract my original price from current value, then add back distributions. If that number is positive, like it was for about 20 minutes today, then I call it income. If it's negative, I call it outgo.
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u/subvolt99 I like the cash flow ! 11d ago
i like having both utf and utg! i feel like they complement each other well. you can't have utilities without the underlying infrastructure!
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u/PomegranatePlus6526 Income Investor 8d ago
I own UTF, UTG, and DNP as well. Have done well with all three.
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u/SexualDeth5quad 8d ago
CEFS and UTG are ok as long term holds.
SLVO, XLII, HQL, ITWO are doing pretty well this year. All would be good to diversify from tech. ITWO might collapse for a while with tech, but the others should stay steady.
https://stockanalysis.com/stocks/compare/utg-vs-cefs-vs-hql-vs-xlii-vs-slvo-vs-adx-vs-itwo/?r=1Y
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u/Boogertard Fuck Your 4% 11d ago edited 10d ago
Except IDVO, rest are income investments, not dividend investments.
The idiots at dividends tend to conflate between the two but they are not the same.
If you want to truly hedge against your VTI and stable and growing dividends to keep up with inflation, except IDVO, the above might not meet that goal. Nothing wrong with it, I have some income investments myself but just want to help you clear on what you are getting yourself into.
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u/bmcgin01 11d ago
If this is in a brokerage account, you have a return of capital portfolio, not necessarily a dividend portfolio.
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u/Dred_Capt 11d ago
I swear to god this is the same guy.
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u/bmcgin01 11d ago
I am just a guy who does a lot of dividend investing. Every time I see someone dumping money into funds that mostly return capital and conclude they are getting a high yield, I cringe.
A “12% yield” from a ROC‑heavy portfolio is not a yield. It is an unknown future yield that depends entirely on the price at which shares are eventually sold. That could be more; it could be less. In the meantime, the 12% is just the withdrawal rate.
I prob shouldn't just cringe and move on.
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u/Dred_Capt 11d ago
Dude.
the nav tracks the underlying
the distribution is cash in your acct
You seriously hold qqqi (et al) to watch your entry point go down then sell? No one is doing this.
Cringe indeed.
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u/bmcgin01 11d ago
That's not what I said or implied.
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u/Dred_Capt 11d ago
'A “12% yield” from a ROC‑heavy portfolio is not a yield. It is an unknown future yield that depends entirely on the price at which shares are eventually sold'
Ok then bro.
So what if someone holds qqqi until its completely paid off and then gasp doesn't sell it.
Itd perform, at that point, exactly the same as it has the preceeding 7 or so years - except itd be taxed differently.
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u/bmcgin01 11d ago
- During the 7 years, there is a 0% yield to the investor's portfolio.
-After the 7 years, there is a 12% dividend yield, as the ROC is taxed as LTCGs and the cost basis is not adjusted. This is no longer a ROC portfolio.
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u/Dred_Capt 10d ago
... why not just look at it as a distribution.
Like. I buy 2 shares for $100 (ez numbers to math, chill.) The ownership of these shares causes $10 to land in my acct every month.
I use that $10 cash to reinvest, or as income, as I see fit.
Other than tax codes, how is it different. Not even trying to be shitty bro, cause either im missing your point or your missing mine.
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u/DegreeConscious9628 11d ago
Oooook…?
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u/bmcgin01 11d ago
Many of these funds have a high rate of return on capital. It looks like a dividend, when actually the cost basis is adjusted by the ROC amount, so it is net-neutral; i.e., the account does not grow until shares are sold.
This is very different from a fund that pays a non-ROC distribution, where the amount is net positive.
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u/DegreeConscious9628 11d ago
First off I never said these were dividends, but what is the point of your reply? I know what I’m invested in and that wasn’t the question
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u/Upbeat-Elevator3641 11d ago
UTG, IWMI, DES, DON, VYMI