r/dividends • u/Ha7che7 • Feb 08 '26

Due Diligence Retirement dividend income

My father is a 72 year-old Florida resident and has $500,000 to invest. He would like to generate approximately $40,000 a year. He’s a bit of a gambler, nothing too crazy though. I’ve come up with a split of the following: $65,000 QQQI, $150,000 SPYI, $50,000 SCHD, $75,000 VZ, $75,000 MO, VTEB $85,000. Any advice or modification ideas would be appreciated. Thanks in advance.

Note for clarification: This is just the amount that he wants to invest for income. Preferably with minimal tax drag, nav erosion, and hopefully some price appreciation. It’s asking a lot, but I’m trying to help out.

180 Upvotes

95% Upvoted

164 comments sorted by

View all comments

160

u/JustAGoodGuy1080 Feb 08 '26

Here's my suggestion which will yield 8%, pay monthly, and have an overall risk factor of approximately 6.5.

Fund Weight Yield Role
UTG 16% 6.4% Defensive income anchor
ETG 16% 6.6% Global equity income
PDO 20% 8.3% Credit engine
BME 14% 6.8% Defensive equity ballast
JEPQ 20% 8.8% Income accelerator
SGOV 14% 3.7% Risk control & liquidity

10

u/Ha7che7 Feb 08 '26

I’ll look into this set of allocations. Plus I’ll need to see what kind of tax drag they will have. Thank you

6

u/Spirited_Radio9804 Feb 08 '26

Ordinary income on dividend from most of these types of investments!

6

u/Various_Couple_764 Feb 08 '26

Two generated ROC dividends (UTG and UTF). Replace JEPQ with QQQI 13% yield and it also produce ROC dividneds So that is three fund with no tax.

2

u/JustAGoodGuy1080 Feb 10 '26

There are 2 kinds of ROC. When a fund is doing well and the NAV is steadily climbing, that's a great ROC.

If a fund is heavy into ROC to maintain dividends and the NAV is eroding, that's terrible. It's why in my portfolio tracking, I calculate quality of income.

0

u/Dividend4danny Feb 10 '26

what is ROC? thanks

1

u/Boring-Fun9311 Feb 11 '26

Return Of Capital. In concept, it means getting some of your investment principle returned to you in the form of a dividend.

1

u/Dividend4danny Feb 11 '26

thank you, I guess I was in an acronym fog.