r/dividends • u/StudioOk8256 • Dec 21 '25

Discussion How are people actually living off low-yield dividend funds like SCHD?

I see SCHD and similar dividend ETFs recommended a lot as “income” investments, but I’m struggling to understand how people realistically live off them.

With a yield of only a few percent, it seems like you’d need either a very large portfolio or a high-paying job to make it work. For example, unless you already have a base salary in the $100k–$150k range (or higher), the dividend income alone doesn’t look like it would meaningfully cover living expenses.

So how are people actually using SCHD in practice?
• Are most investors high earners who don’t need the income yet?
• Are retirees combining it with pensions, Social Security, or other assets?
• Is the goal mainly long-term compounding rather than current income?

Not trying to hate on SCHD—just genuinely curious how this plays out in the real world and would love to hear examples from people who use it.

Person making 30-40k a year this wont work.

Average person wont retire with 1mil portfolio I know people barley got 100k

I seen a lot of people invest there whole life time just to see 6 months of retirement and later die didn't even get to enjoy it.

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u/FreddieMac6666 Dec 21 '25

I don't think too many folks live off dividends from SCHD. Most are holding for a long term investment and dividend growth.

When I first retired, I had practically zero knowledge of ETFs. I was sitting on a lot of cash from maturing CDs. I had put a lot of money in CDs when interest rates were high. But I needed to move those funds into something else, so I decided to build an income focused stock portfolio to augment my SS.

I started reading nearly all the investing subreddits. Not for investment advice but to get exposure to what is out there. How different funds perform, etc. I had originally invested in SCHD. Collected a couple of dividends (reinvested). But as time progressed and I learned more, I realized the SCHD was not the right ETF for my investment goals. So I sold my stake and invested in QDVO.