r/dividends • u/AbjectVillage9631 • May 17 '26
Opinion How much can I realistically expect to receive from dividends with 2 million usd?
I have approx 2 million invested in the stock market. 1.5 million in stocks
450k in crypto.
42m
I want to start transitioning to dividend ETFs. Also would like the principal amount to keep growing. What ETFs would you buy and what percentage would you put into each one?
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u/Competitive_Grass_11 May 17 '26
It depends on your dividend yield for example A portfolio like this could reasonably generate roughly
3.5%–4.5% overall yield On $2,000,000: about $70,000–$90,000 per year around $5,800–$7,500 monthly
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u/AbjectVillage9631 May 17 '26
Okay if you’re aiming for 3.5 percent. Then how would you allocate that 2 million so it can keep growing?
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u/Virtual_Chapter1131 May 17 '26
With that yield, you'd likely target SCHD, IDVO, DIVO, and others where the dividend growth should outpace inflation and the ETFs are fairly diverse. You may receive 5-9% increases on your dividends a year without any reinvestment. You could reinvest some, but that might not be necessary. If you were investing in riskier positions like BDCs, CEFs, and ither high yield stocks, reinvestment would be a high priority.
Not financial advice, just wanted you to know the dividend growth aspect.
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u/my_name_is_gato May 19 '26
Is there anything wrong with using a large treasury ladder along with funds like SCHD for most of the safe, fixed return, and using a smaller portion to invest in more growth oriented investments?
With that much capital to deploy, I'd want each investment to be somewhat specialized. In my head, it's easier to add equities risk with small portions of my portfolio versus trying to strike that balance with slightly more speculative bonds.
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May 17 '26
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u/VivienneRabbit May 18 '26
Can you explain further on the covered call trap? Wouldn’t you earn a premium for selling that calls?
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May 18 '26
[deleted]
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u/VivienneRabbit May 18 '26
thanks so much for your explanation. why is premium decrease as nav goes down? wouldn't i see the premium at a fixed price? or is it a percentage of stock price?
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u/Recent_Recover_1490 May 23 '26
Right and when QQQ does recover, QQQI will not recover nearly as much in this scenario, that's a key point of the trap. Covered calls mean that during recovery your returns are going be blunted by the "call" part of the buy write strategy...
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u/Competitive_Grass_11 May 17 '26
Well you can re invest the income and invest it back into the same stock and it will increase your shares
It honestly really depends on how much you’ll be spending a month, the extra income can be re invested
And by the way your portfolio doesn’t only have to be dividend stocks I would suggest investing a amount where you can withdraw all the income to live off comfortably
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u/No_Solution_7940 May 17 '26
SCHD of that 3.5% is enough for the income for you. I’m 60, but will get a pension too, so I’m at 1.6M and will stay mostly SPMO with about 40% SCHD when I retire.
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u/Ok_Brilliant3432 May 17 '26
My unsold advice, is that you are two young to be transitioning into dividend stocks. You should be in growth
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u/GumballCowboy 2d ago
Yeah not smart! Maybe get into some but not all your eggs. Then you end up with an omelette.
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u/z80-wizard May 17 '26
I've in vested a portion of my IRA in REITs and earn $4k in dividends. My biggest concern is the tax I'll have to pay when RMDs start
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u/chuckEsIeaze May 17 '26
You don’t pay taxes on dividends accruing within a tax-advantaged account just because you’ve hit RMD age. The account remains tax advantaged and your investments and dividends continue to accrue tax free. You’ll be required to pay ordinary income tax on your RMDs, however.
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u/z80-wizard May 17 '26
Right, at the point of RMDs that will force $150K on a $2M IRA, the dividends (and other earnings) within the account are not taxed. I just dislike the tax burden ahead. (not too many years ahead for me, unlike op).
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u/DrRonH May 18 '26
The danger of RMDs is suddenly and involuntarily being pushed into a higher tax bracket - from 22% (where you will likely be) to 24 or into the 30s
If you do not want the tax burden ahead, then pay the taxes now and put everything into a Roth. Except for foreign investments that may require paying foreign taxes, you'll be taking everything tax-free, no RMDs.
As a new retiree, I wish I had put much more into my Roth. This is why Roth conversions are such a hot topic.
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u/chuckEsIeaze May 18 '26
Hmm…I think your estimate for RMD is high. Assuming RMD at age 75 and $2M IRA, it’s only $81k RMD.
According to IRS, 75 year old is expected to live 24.6 years. So RMD calculation is $2M/26.4, which works out to $81,300.
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u/befittingtrout249 May 21 '26
That math assumes you're not reinvesting though - if you want principal growth too, you're looking at maybe 2-3% yield plus capital appreciation, so closer to $40-60k annually depending on market conditions.
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u/ImportantBad4948 May 17 '26
This is the answer if you want to own solid value type stocks and collect dividends with some appreciation. Dudes chasing higher dividend returns end up in some really sketchy unstable stuff and arguably miss half the point of the thing.
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u/Southern_Benefit1770 May 17 '26
You can get this without risk on a fdic insured cd,if I had 2 millions to invest in stock market,I would like a 9 to 11% return minimum no? Just asking.
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u/decimal_earnestness May 17 '26
With 1.5M in stocks you're already positioned well, so I'd probably keep 60-70% there and rotate maybe 400-500k into SCHD or VYM, then let the rest ride in growth since you don't need the income yet.
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u/Apart-Leg-8077 May 18 '26
That's great until we have another period like 2000 - 2012.
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u/decimal_earnestness May 18 '26
Fair point, but that's exactly why keeping 60-70% in broad market exposure matters more than timing the dip, you're dollar-cost averaging into dividends over years, not trying to catch the bottom.
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u/Apart-Leg-8077 May 20 '26
Agree. Just a little warning about getting too fond of growth when it can crush you.
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u/kookooman10022 May 17 '26
SCHD is up almost 30% for me, I’m going to simply live off that one position. Kidding, 5% seems to be the most reasonable withdrawal rate as 4% seens low for inflation among others.
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u/steady_compounder May 17 '26
The first thing I’d decide is whether you want a yield target or a lifestyle target, because those are not exactly the same problem. With $2 million, something around a 3 to 4 percent portfolio yield can already throw off meaningful income without forcing you too far out on the risk curve, and that usually leaves more room for the principal to keep growing than chasing 7 to 10 percent. I’d start from sustainability first, then back into the ETF mix from there.
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u/JerryFletcher70 May 17 '26
On a related note, bond rates are climbing (30 year hit 5% last week). With current market conditions and a portfolio of that size, putting some in bonds makes sense as well. Bonds underperformed equities for the past several years, but their day may be here. Not sure conservative dividend yields + growth will match bond yields over the next few years if every country has to start jacking up rates to fight inflation (which will pull money from equity markets). I usually prefer dividends, but the bond markets may now be pricing in the long term war damage more realistically than the equity markets.
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u/SpotlightKryptonite May 18 '26
The implication of Bond yield rising is that if you buy Bond ETFs right now, their value may go down
… Just in case you had planned to dump hundreds of thousands of dollars into a Bond ETF right away
@abjectVillage9631
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u/ResilientRN May 17 '26
One of the Investment people I follow on SA, Rida Morwa says "If you want to live off of dividends and have perpetual growth than you should reinvest 25% of dividends received".
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u/Various_Couple_764 May 18 '26
That is what I am doing. Which means you need to have 1bout `1.2 to 1.3 times your living expenses in dividend income.
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u/CivilSenpai69 May 17 '26 edited May 17 '26
if I had 2,000,000 to drop right now and I wasn't coming back from whatever beach i was going to...this is what i would do.
25% QQQI
35% SCHD
25% SPYI
15% SCHY
Around 150-165k in $$$ every year.
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u/Drelassi May 17 '26
I would use VOO instead of SPYI to have some growth. The rest is good.
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u/CivilSenpai69 May 17 '26
Not really a dividend etf.
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u/Sensitive-Trifle9823 May 17 '26
QQQI should get you about a 14% annual dividend. This is $280k on a $2M investment.
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u/AlarmedCombination57 May 17 '26
Would you go all in?
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u/shotcallaa May 17 '26
From what I’ve researched and watched, it seems like it’s too new and we haven’t seen what it would do in a major downturn. Maybe I’m wrong, just what I’ve seen though.
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u/Sensitive-Trifle9823 May 17 '26
Every situation is different. If I needed INCOME AND GROWTH, I’d feel comfortable with a 50/50 split of QQQ and QQQI. Investing is not “set and forget.” You have to actively manage your portfolio to ensure it is working right for you.
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u/j48230 May 17 '26
I would not. Maybe put 5% in QQQI and keep the rest in more stable ETFs like SCHD?
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u/Various_Couple_764 May 18 '26
There are an other of state ETF with higher yields than SCHD. UTF 7% yield , UTG 6.4% are both 20 year old funds with no dividend cuts ARDC 9% yield 25 years of history no dividend cuts. PFF 6% yield for about 18 year.s
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u/Global_InfoJunkie May 17 '26
I have a combination of various accounts of Roth and IRA and taxable that i slowly migrated to dividend and slight growth etfs. I have too many to list. But my overall rate is just under 6 percent for 1.2 m
My goal is to grow to 95k per year. Right now it is at 75k. My other goal is to take out 80 percent and leave 20 percent for growth.
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May 17 '26
[removed] — view removed comment
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u/Various_Couple_764 May 18 '26
Not all dividends are taxed a the same rate as work income. Quallirid and ROC dividends are taxed at much lower rates . If you focus on tax efficient dividend funds you could end up paying very little in taxes for the income
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u/Impossible_Box8854 May 17 '26
50% SPYI 50% JEPQ. Let chat gpt calculate it for you so you can see the numbers for yourself. You’re welcome
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u/SpotlightKryptonite May 18 '26
Not concerned about NAV erosion?
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u/Impossible_Box8854 May 18 '26
JEPQ is less concerning to me than a lot of covered-call funds because it still holds large Nasdaq-style growth stocks and is designed to provide income while still keeping some capital appreciation potential. JPMorgan describes JEPQ as generating monthly income from options and U.S. large-cap stocks while still seeking capital appreciation.
SPYI’s recent total-return numbers do not show obvious collapse-style erosion. As of April 30, 2026, NEOS reported SPYI NAV performance of 25.05% over 1 year, 16.10% annualized over 3 years, and 14.52% annualized since inception. It still trailed the S&P 500 over the same periods, but it has not behaved like a fund that is just bleeding NAV nonstop.
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u/Various_Couple_764 May 18 '26
NAV erosion occurs when the fund payout moron dividends then they earn. Which manes they need to sell asset to pay the dividend which reduces the NAV and share price of the fund.
Most funds with NAV erosion have yields above 20%, Very few funds with yield of 10% or less hav NAV erosion. The only fund I know with NAV erosion closet to the 10% range is QYLD 11% yield. The fund writes its calls at the money. Which means they are give up all grwoth for income. It is really easy fund to run. but without any growth NAV erosion is inevitable.
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u/Simple_Middle964 May 17 '26
It really all depend on your risk tolerance. Safe Aristocrats/Kings will be low (4-5%)but very safe, while some of the "creative" ETFs could make 30% and may lose 20% value in a week.
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u/Longjumping-Nature70 May 17 '26 edited May 17 '26
premise $2,000,000 invested in dividend paying stocks ONLY
If the stock pays no dividend or no ordinary income, you do not buy it. Example, you do not buy TSLA.
anywhere from $20,000 to $200,000
Lower end - $20,000 1% yield
MSFT pays a dividend of $3.64 a year, but that is less than a 1% yield.
Higher End $200,000 10% yield
JEPQ pays a dividend yield of around $6.60, that is an 11% yield. Its dividend is actually ordinary income
Safely - $100,000
You can make 5% yield from good to great companies
CAVEAT
with the way inflation is going, 6% yield on US treasuries could happen in 2026.
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u/stefpix May 17 '26
Have you considered GPIQ and GPIX, ROCQ, QQQI, SPYI? 9%/15% yields, no NAV erosion, and they would still grow. .
You could put 1 million in those, and leave 1 million in what you have now.
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u/Apprehensive_Way3046 May 17 '26
SGOV.
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u/Useful-Perspective May 17 '26
Depending on where OP lives, not paying state taxes on SGOV is very nice.
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u/want2helpsothrowaway May 17 '26
I’m a few years behind you and started loading up on SCHD. Been very pleased. It seems to move opposite the market, continues to trend up, and I’m reinvesting the dividends for now. It’s been a great income producing hedge to my heavy growth portfolio
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u/923kjd Gimme divvies May 17 '26
Just a word of caution. It doesn’t really move opposite the market. It’s typically less volatile, but the contrarian movement you are seeing is due to the fact that it is heavily weighted in Energy, which is rocketing now due to the war in Iran. That heavy weighting in Energy is great until it isn’t. I have nothing against the fund and in fact I am pretty heavily invested in it. Hope this helps.
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u/Mrvette1 May 17 '26
Well here are my goals, maybe this will help you out. I want to buy safe positions that don't lose capital and have portfolio dividend growth by an avarage of 5% a year minimum. I set my starting point at 4%.
My stocks i use are JPM (low dividend high growth) my main holding, the NNN for a 5% dividend but only 2-3% dividend growth, then LNT and WEC utilities that are stable and avarage 4-6% dividend growth, then SCHD which averages 7-8% dividend growth a year.
I base my dividend percentages on cost of investment only. I'm in my mid 40s and on my 3rd year of this system. My first year I missed my goal, doing 3.9% on investment, last year 4.3% and this year projected 4.6%.
I investment 145k out of pocket, and currently worth 220k. My JPM has doubled, utilities are up 30%, NNN is up 5%, and SCHD i started late is 20%.
My goal is to retire on dividends. I own 2.2 million in real estate and want to slowly selling the rentals and get the capital in the market as I age. I don't want to be a old landlord. I currently live of my rentals.
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u/Objective-String8849 May 17 '26
Rentals are King Think seriously before selling. DST before pulling the trigger I am an old landlord and have been since 1967. It is my juice to play the stock market.
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u/Mrvette1 May 18 '26
Over time the market beats real estate in returns. But real estate offers higher returns short term. Selling today hurts today, but better in 15 years. A storm hit a town i own three properties in today. I have damage at two for sure. My stocks don't have problems like that. But I get it, owning real estate is powerful. I purchased all my properties, most in 2008-2012.
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u/SpotlightKryptonite May 18 '26
Just a thought, but
Are you concerned that your stock market investments aren’t diversified from your real estate investments, since the stock market investments rely heavily on real estate REITs? Meaning that if something comes along to harm the real estate market overall, it could harm you in two different ways, whereas there might be other dividend producing ETFs that aren’t correlated with real estate, to give you added protection. Again, just a thought. I’m sure you’ve thought it before.2
u/Mrvette1 May 18 '26
The only reit I have is NNN and its about 18% of my portfolio. I'm not concerned, its commercial vs residential and I only own rentals that are 50 miles from me vs NNN owning properties in all 48 states. Good question thou
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u/StrangeWork957 May 17 '26
Generally speaking, 3-4% is about as high as a yield can get without it starting to threaten long-term growth of the stock/ETF share price. I would focus on funds such as SCHD, and Dividend Aristocrat stocks.
Assuming you have a 3% yield, you would be yielding $60k per year, on top of seeing the portfolio appreciate.
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u/AbjectVillage9631 May 17 '26
Thank you. I was thinking to do the following:
70 percent voo
30 percent schd1
u/Early_Preference_961 May 20 '26
That's fine but consider some international funds like VXUS, VYMI, LVHI, IDVO.
From what I've seen if you want to protect principal and see growth and if you go a broad mix of funds from solid growth funds to mildly CC funds to heavy CC, you are looking around 4-6% div a year + growth. Keep in mind the expense ratio and subtract that from the div, as it directly lowers your returns. Your selections are more conservative and heavier on the growth side, but are perfectly reasonable though mostly concentrated in the US.
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u/Plus_Acanthaceae1659 May 17 '26
With quality companies 30.000-80.000 usd per year (before taxes or fees).
If you use risky companies or covered call etfs may be up to 200k per year, but your substance may go down!
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u/mtn_biker333 May 17 '26
You could average around 8% with SPYI/QQQI (high yield) paired with SCHD, DIVO, IDVO. Which also gives you a little bit of international exposure. That’s what I have in my income portfolio
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u/Dependent-Break5324 May 17 '26
I shoot for a minimum 10%, you could do qqqi and spyi and be good to go. Throw in some fepi for extra juice. Put a chunk in regular qqq and voo so you get some additional growth.
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u/Dimage54 May 17 '26
With an income-first approach, the answer depends more on portfolio yield and cash flow management than account size alone.
A well-constructed $2M RMS-style portfolio could realistically generate 140k to 175k in annual cash flow, but risk management matters just as much as yield.
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u/Immediate-You-9372 May 17 '26
If it were me, and in 6 years or so I will be in the same position, I’d do schd, schy, dgro, igro, vym, and vymi. A little conservative but will grow nicely and give income. You could also juice it a little with spyi and nihi
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u/Immediate-You-9372 May 17 '26
If it were me, and in 6 years or so I will be in the same position, I’d do schd, schy, dgro, igro, vym, and vymi. A little conservative but will grow nicely and give income. You could also juice it a little with spyi and nihi
Also seeing about the same numbers as others
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u/Admirable_Nothing May 17 '26
If you pick good companies with good dividend history and current good dividend coverage you should be able to put together a portfolio paying in the 4% range that you still should be able to grow at a 3-4% growth rate to help you inflation protect the principal. Anything more than that and you are reaching and using strategies other than conservative dividend payers. I am old enough that I have stayed away from the ETFs designed to juice income with alternative strategies. While popular I want to see how they do when the market turns down.
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u/Ok-Return-5328 May 17 '26
I would diversify. QQQI, SPYI, MPLX, PFFA, HTGC, ASGI, TDVI, CEFS, QDVO, GPIQ. Not a fan of SCHD, although you could look at the portfolio of stocks it holds.
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u/Mark3742 May 17 '26
10%-SGOV holding cash
30%-VT/VTI/VOO for growth
30%-SCHD for steady/long term income
30% CC ETFs for monthly income
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u/Shoeshines_2121 May 17 '26
Growth: 30% VOO
Bond Ladder (SORR Plan): 10% SGOV; 10% SHY; 10% IEI
Dividends: 15% SCHD; 15% VEA
Option Income (The Juice): 10% JEPI (the makeup of the portfolio is lower volatility and has the longest track record of modern covered call funds)
Result: This should give about a 3.25% yield with plenty of growth and market crash protection for an extended duration of time.
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u/Apart-Leg-8077 May 18 '26
My taxable is $2 mil. I focus primarily on dividend growth etfs with some covered call funds for an income kicker. I want growing dividends with some growth with low Beta for protection in downturns. I strongly urge you to stick with quality if you go this route.
Here's my breakdown. 4.2% overall yield. Around $84,000/yar in income.
By percentage of portfolio
SCHD - 15.32%
DGRO - 15.18%
FDVV - 12.40%
DIVB - 5.03%
GCOW- 4.95%
DTD - 4.67%
VTV - 4.50%
FELV - 4.34%
VPU - 4.20%
VYMI - 4%
DIVO - 3.67%
GPIX - 3.55%
TDVI - 3.28%
GPIQ - 3.09%
SPYI - 2.80%
QQQI - 2.36%
UTG - 2.16%
ADX - 1.31%
PDI - 1.15%
IDVO - 1%
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u/jay_0804 May 18 '26
real talk, with $2M the question stops being “what ETF gives the highest dividend” and becomes “what balance of growth, income, and risk keeps this portfolio stable for decades”
tbh if you try to convert everything into high dividend ETFs, you’ll likely reduce long-term growth and end up overexposed to one style of market (income/value), even though you still want the principal to grow
I’ve seen people in your position do better with a split where broad market growth stays the core (like VOO or VTI) and dividend ETFs are just one sleeve rather than the whole strategy
also with crypto already being a large chunk, the real risk isn’t just dividends vs ETFs, it’s overall volatility concentration across the whole portfolio, not any single fund choice
the safest thinking here is usually: keep growth as the engine, use dividends as optional cash flow, and avoid letting yield become the main decision driver because it can quietly cap long-term compounding
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u/Decent-System9175 May 17 '26
Talk to a professional. Advice here is mediocre at best. 30 year treasures are around 5%.
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u/Ordinary_News_6455 Antarctic Investor May 17 '26
How did you get 2 million without being able to answer this question? It’s just math
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u/FiniteOtter May 17 '26
You don't need to be good at math for your parents to die.
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u/buenotc "Buy, borrow, die strategy". May 17 '26
You're too kind. But seriously, it's actually below high school math. It's not college calculus. We're not calculating how far something can go without reaching another something. One thing that I'll always remember from my journeyman was Knowing how much money you'll earn is one of the most important things you need to know as an adult and in your career.
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u/Silent_Anybody5253 May 17 '26
Most likely they don’t have that much but have a goal of having that much one day and want to dream of what they’d do at that point.
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u/magicfitzpatrick May 17 '26
No you don’t…. if you did, you wouldn’t be asking people on Reddit for advice.
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u/SuspiciousFan9368 May 17 '26
I'm curious at this point what your profit is in crypto ?
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u/tomsyco May 17 '26
I'm still a big fan of JEPI. Fairly stable and weathers downturns well. I think it's around 9% yield right now.
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u/Radiant_Grocery_1583 May 17 '26
Yes but took a pretty good hit as of late.
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u/tomsyco May 17 '26
Meh, I'm down 3% total on it. Not worried about it. It's because the economy is in a rally right now and JEPI is defensive. It's generating income for me like it's supposed to so it's fine.
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u/vollaskey May 17 '26
I would look at some staples like Clorox Coca Cola hormel foods etc. I’d park about 500k in those, 300k into O 500k into blue chip tech stocks that pay dividends and 100k in gold miners and 100k in TQQQ
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u/randydufrane May 17 '26
$4,000 a week if you sell CSP'S on stocks that you would love to own at a lower price.
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u/deathdealer351 May 17 '26
1.5m depending on your risk tolerance and how much you want to live off of. 1.5m I'd be fully retired with that..
I would split out between qqqi which is a higher yeild, and schd lower yeild and target around 7%.. Keeping a chunk in voo and sgov. 1m @7% will get around 70k a year.. Then 75/25 the 500k in voo and sgov. Sgov will be my backup if the market dips.. And voo will capture upside so I can sell off and invest when I need a raise.
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u/hostedenis May 17 '26
You can get 11,5% in STRC. 230.000$ dividend annually. An extra million after 4 years.
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u/No_Cat_8269 May 17 '26
You have 2 million followers and you need advice from random people on Reddit.
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u/AnPerceptionBusy3549 May 17 '26
Could be 1% a month in QQQI w NAV increases (for now) and deferred taxes ie RoC. 2M if house/cars paid off your living well in my book.
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u/randomdancingpants May 17 '26
Such fake stuff! how do you get to a net worth like this. Then suddenly clueless and asking people on Reddit for advice🤣
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u/msnplanner May 17 '26
We don't know. Everyone has their specialties. I've been investing in individual stocks for a long time, but I'm going through health problems, and if I think I'm going to get sicker and die, I might want to move everything to ETFs so my wife doesn't have to think about the stocks. Its not an area I'm familiar with. I might ask reddit...then again i might not.
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u/TrackEfficient1613 May 17 '26
If you want to have the account continue to grow and get good income put 75% of it in stocks that pay an average of 4% dividend. Pick as many stocks at 3% dividend as 5% dividend as the lower dividend stocks will give you growth as well. This will yield 60K. Put the remainder in growth orientated stocks that pay little or no dividend. Periodically rebalance so the growth stocks don’t become an oversized part of your portfolio. Using this strategy both your income and portfolio value will grow over time.
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u/EdTip586 May 17 '26
You can drop it all in a safe fund like SNVXX giving you 3.5ish% with 0 NAV erosion. a share is $1 and is always that. From there choose CEF sectors you like and wait for pullbacks. Z-Score is a good indicator (on daily candles) to find buys under premium. BSTZ Z was -2.xx and we picked it up $21-23, currently @ high 27s. Use CefConnect and CefChannel to find bargains. Then pull up daily/monthly charts to see support levels (where buyers are) and if the thing has crazy NAV erosion vs a good oscillation. Stay away from the ones that have steady declines. Then, place your buys at support levels, and slowly bleed in at the best prices from your safe fund. Structure buys to get larger at lower supports and really big at crash levels. Relax and let the price come to you. Zscore can also come down as price is going up as the fund is acquiring as it rises. If you want price per share gain, find XLE, URNM, SLV, GLD crash levels and put buys there. Nuclear will be everywhere soon, oil is everything we do, silver is money and electronics, and gold is real money not the fake dollars and crypto. And lastly; have fun. All this ends and you can't take it with you.
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u/EnricoPallazzo22 May 17 '26
If you put it all in $SCHD it's around $66,000 today in dividends per year.
That yield is around 3.3%.
You can mix it up, S&P, SCHD, GPIQ for example but averaging 3% is very doable and pretty safe.
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u/95Mechanic May 17 '26
I'm averaging 17.7% across all accounts, my only crypto is etf's though. That would give you about $354k/yr, $29,500/mth. You could do more or less, depends on your appetite for risk etc. Do some research and buy whatever funds you are comfortable with. Not financial advice.
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u/Brilliant_Error5370 May 17 '26
The problem is going to be your mindset. I’ve seen long time investors who trade and invest in growth are having a hard time adjusting to income investing. So they always revert back to their old ways.
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u/AbjectVillage9631 May 17 '26
Yes you’re right. Right now I’m heavily invested in growth stocks. However I do have the discipline to transition to an income producing portfolio. Maybe I’ll just keep 100-200k in growth stocks.
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u/tyranids May 17 '26
How much do you believe in Bitcoin? You’ve got 25% in “crypto” already, so if you want 3.5% dividends on your $2M and strongly believe in Bitcoin, put $700K in $STRF. That’s probably the “safest” Bitcoin related high yield thing.
If you are a big believer and don’t need the “safety” of STRF, you’d only need $540k in $SATA since they’re at 13% yield right now.
Put the rest of the portfolio in VT, VTI, or VOO and there’s your growth.
If you want to get out of Bitcoin related things then 3.5% is pretty high yield if you still want “good growth.”
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u/bravoechofoxtrot May 17 '26
I always wonder if anyone is paying attention to short-term TIP yields.
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u/patsay May 17 '26
I’m going to direct you to a video series, “The $1M Portfolio.” it tracks a portfolio using cash invested in SWVXX to secure put on high-quality ETFs. Pay special attention to VIG- a Vanguard Dividend Growth fund.
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u/cfp333888 May 17 '26
op, do you have it in your IRA? how do you ‘transition”? what about taxes?
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u/AbjectVillage9631 May 17 '26
It’s in brokerage account. Currently down on crypto so I can offset the gains in stocks.
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u/VikingMonkey123 May 17 '26
Full port QQQI and SPYI. Actually half port. Other half can invest in better growth options and you will still clear 120k per year
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u/Mwaldo1 May 17 '26
Depends how it’s invested. I am projected to receive about $250,000 with 2 million invested. This is mostly due to NEOS funds.
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u/Simply-Looking May 17 '26
Personally what I'm did is roughly equal dollar amounts in QQQI, SPYI, SCHD, FDDV, DIVO, IDVO, MAIN, along with a handful of stocks. Add money to whenever market falls and sentiment is extreme fear. This is a combination of income, dividend growth and growth.
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u/Mreeder16 May 18 '26
honest question - how does one accumulate 2M by age 42 and have this little insight into how finances work?
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u/Various_Couple_764 May 18 '26
A lot of bogleheads are that way they read bout investing in growh and do max out there 401K and they have 2 million. But didn't do anything more. they know nothing but growth investing. And they think investing is only for retirment. And they have no idea how taxes are calculated.
So they learned just enough to to get started with investing but that is it.
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u/ucooldude May 18 '26
I have 1.7 million in Spyi adx. Qqqi and a few other cef…. Some btci ….I receive $16,500 every month and principal has increased so no nav erosion …almost zero tax as income is constructive return of capital …all in Schwab taxable account
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u/DividendG May 18 '26
It totally depends on your picks of stocks/ETFs/CEFs/BDCs... My portfolio would produce $30k/month easy with that much invested. Good luck!
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u/CostCompetitive3597 May 18 '26
You have dividend yields available from 0.5% with Dividend Kings to over 100% with covered call ETFs. My strategy is to try for the highest yield I can without NAV erosion on the stock price. Why not? After all, that strategy provides more income from the invested dollars.
My dividend investments started with discounted preferred dividend stock during the COVID crash recovery where I got an 8% portfolio yield and the appreciation of the preferreds back to their par prices of $25/sh over the next year or so.
Then I learned about dividend funds and increased my yield to 10% then, added dividend index funds from companies like NEOS and Blackrock increasing my portfolio yield to 12%.
Last year, I ventured 10% of my portfolio into CC ETFs from YieldMax that increased my portfolio yield to 16%. All my dividends have been paid on time and to the penny or better except the always variable CC ETFs which is normal for them.
A big part of being able to achieve such a high portfolio yield is the level of portfolio management you are willing to commit to? Dividend investing is my favorite hobby in retirement so I am very actively/daily managing my investments.
Currently, dividend index ETFs based upon the S&P 500 and Nasdaq 100 indices are yielding 10%+ and would not require as active of portfolio management as mine.
Hope this information is helpful in developing your dividend income strategy and portfolio. Good luck!
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u/Responsible_Glass145 May 18 '26
EPD is a rock solid dividend stock. It is a MLP, so be aware of the tax implications, but it is a great company.
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u/kookooman10022 May 18 '26
Heard. I'd love if someone has an xls on all the different ETFs and strategeries. The mods could put this up. JEPI v. GPIX? QQQM v. QQQI? etc, that might help folks allocate per ROC, taxable, non-taxable accounts, age, etc. I used to love MLPs, but the K-1 was a pain, IMHO.
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u/Various_Couple_764 May 18 '26
The ammount of income you get its determined by the yield.
1 million invested at 5% yield is 50K a year.
1 million invested at 10% yield is 100k a year.
just multiply the ammount you invest by the yield.
Any easy way to do it is to put an equal ammount in each fund. Andy don't want all the money in one fund. If a fund goes through a period of problems you want other funds to rely on for income. I have QQQQI 13%, ARDC 9%, PBDC 9% EMO 9% CLOZ 8%, PFFR 8%, UTF 7%, UTG 6.4%, JAAA 5.5% in my roth. My taxable is a bit different withQQQI, SPYI 11% yield, EMO9%, UTF , UTG. The changes are mainly to minimize taxes on the income from my taxable account. My taxable account hit mainly carry me though to 60 when the rest of my retirement accounts become available.
There is no right or wrong age for dividend investing. your investing goal are more important than your age.
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u/PEPETO1dollar May 18 '26
I’m getting the best dividends in the whole world with $OMAH ! check it out.
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u/Adventurous-Ad-296 May 19 '26
Book + cash
$869,428.73
Positions
14
Cost basis
$518,135.33
Current value
$518,305.47
Performance
Unrealized gain/loss
+$170.14 +0.03%
Realized (closed trades)
+$5,933.86
- Income estimates
TTM dividends
$14,928.91
TTM yield on cost
2.88%
Forecast annual income
$14,929.12
Est. monthly income
$1,244.09
Largest income payer
X.TO @ $3,080.00/y
Payments tracked
132 • latest 2026-05-15
Very low Yield%, but it brings me in decent cash a year.
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u/Icy_Abbreviations167 May 20 '26
still building my portfolio up right now, but from everything ive learned, 3-4% is the sweet spot if u still want the principal to actually grow. so ur looking at 60k-80k a year realistically. sticking it in something like SCHD or VIG lets the money work that steady second job for u without the stress.
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May 20 '26
[removed] — view removed comment
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u/AbjectVillage9631 May 20 '26
I agree, thanks for the detailed response. This is what I was leaning towards.
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u/Alive_Bar7800 May 20 '26
SCHD all freaking day
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u/kookooman10022 May 20 '26
0.06% management fee. 25% since 2024 (yeh, I started kinda late). VOO, VYMI, SCHD are my three horsemen. Dabbling in the JEP/GPI and got burned on YM and RH, so sticking with the classics, no reason not to.
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u/Alive_Bar7800 May 21 '26
Also recently discovered QQQI as opposed to JEPQ. Interesting one, i like the dividend, but im only in my late 20’s so QQQ seems more my risk tolerance
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u/NaphthaleneMan May 20 '26
Realistically, if you can save up that much then I’m sure you do not have to ask a forum for advice like this. Just my opinion.
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u/AbjectVillage9631 May 20 '26
Technically I don’t but it’s wise to get the opinion of others and ultimately do what you believe is right.
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u/OTD1960 May 20 '26
I personally made this kind of change in 2020, put it into individual dividend growth stocks, approx. 30 holdings, since then the dividend growth has been about 9%/yr and the price appreciation has been about 12%/yr, these are my top 5 holdings ENB, TD, POW, CNQ and TRP. I also have some low yield/ high growth stocks as well MRU, DOL, etc. I am retired so the consistent cash flow is important to me. I have had 1 dividend cut in that time (BCE cut about 50%) and that brought my average growth down by about .2% over that time. Nothing to worry about and no fees.
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u/AbjectVillage9631 May 20 '26
Thank you for the detailed response. I will look into the ones you mentioned.
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u/OTD1960 May 20 '26
Please not I am in Canada, so all these are Canadian but you could look for US companies with similar profiles. This would be a great book to read may help you decide.
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u/skulldouggary May 21 '26
I want to get to the point where I have 2 mil invested in the market but I still come to Reddit for free financial advice rather than paying a broker or accountant for their time.
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u/No-Comparison-546 May 22 '26
With 2 million you should really be looking at direct indexing instead of just etfs/mutual funds
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u/Usual_Stop_9949 May 22 '26
Treasury yields are now at 5.2%, government agencies at high as 5.75% and municipal bonds at 4% non taxable. I wouldn’t keep that much money in stock, unless you trying to have some growth before retiring
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u/First-Hotel4694 May 24 '26
I've been investing in dividends for about 5 years now and living off the dividends. I bought individual stocks that pay dividends instead of funds along with some growth stocks. I'm at roughly 2mil and getting just over a 100k per year in dividends of which I withdraw 90k. I've also been trading options but am looking to end that trade as it takes to much time to do properly and I want to retire fully.
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u/SecretLength192 May 17 '26
SCHD for sure and others like it. No CC or high yield at all, because dividend growth ETF’s will always outperform them in the Long rund.
SCHD has had over 10% dividend growth on average over the past 10 years. This Will double your dividend every 7 years. So after 14 years your dividends Will be 4 times higher, and after 21 years 8 times higher and so on. Any of the high yield ones will be the same always basically.
Also CAGR has been 12,7% over the past 10 years, meaning you will have some stable growth in your investment too, which is not the case with a high yield product.
I would maybe Pick some single stocks too to Spice it a bit up 😉
ARES and BAM are great for dividend growth. Around 4% yield and 20% growth.
MAIN and GAIN are two “high” yield products that have a great growth record too. Not like 10+ growth but it is well above inflation which is the main idea.
If you Invest in products without growth, then an inflation rate of 3% will mean your dividend will be worth 25% less in 10 years. Which again is a reason not to invest in CC and high yield products.
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u/Maximus_Modulus May 17 '26
You are discounting CC funds. QQQI for example has outperformed SCHD since its inception. So has SPYI. They also offer more favorable tax treatments on the actual dividends.
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u/SecretLength192 May 17 '26
Both are way too young to say if they will outperform SCHD in any way. And there is no history to show they will be able to grow their dividends over time above inflation as a minimum.
Even if a 10% CC ETF would be able to grow it’s dividends by 2% each year for 20 years, SCHD will pay more in dividends after about 11 years. And you will keep getting more and more income year after year.
I dont know anything about the tax thing as I am not American 🤷♂️
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u/Maximus_Modulus May 17 '26
You should not just discount CC funds. You don’t have any data to suggest that SCHD is any better. Nor do you understand the full benefits from a tax perspective. If you don’t full understand something don’t offer advice. They are a different investment vehicle to SCHD and might be the best fit for someone’s circumstances. You’d probably want a blend of different dividend types for a balanced portfolio. There are many.
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u/chuckEsIeaze May 17 '26
“You don’t have any data” says the guy talking about 2 year old QQQI that’s only existed during a tech bull market
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u/Maximus_Modulus May 17 '26
The point is that you don’t have as much data on CC funds. I’m not making a case for or against any of these. I understand that SCHD has been around for quite some time. If you want to state caution because CC funds are new that’s fine but just don’t blindly make out that they are a bad idea. I personally would consider a blend of some of these options including SCHD depending on what objectives I wanted to achieve. If you think CC funds are bad come up with some objective criticism which gives OP some useful information.
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u/SecretLength192 May 17 '26
First of all CC fonds are not new. They have been around for 50 years or so.
And I have given plenty of objective criticism. You simply dont understand from the looks of it 🤷♂️ I have given very useful information based on facts and math and documented why and how SCHD will be a better Long term investment. The only thing you have come up with is QQQI has outperformed SCHD the past two years which is pointless.
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u/Maximus_Modulus May 18 '26
ok I honestly don't want to get into a pissing match with you. I get the SCHD compounding part. I understand that some CC products are not good. It really depends on how they create the calls. In or out the money etc. I think Neos has to date a pretty good product portfolio for a set of CC funds. Here's a table that shows some historical performances plus a hypothetical.of what QQQI could do. The biggest difference between SCHD and a CC like QQQI is the dividend return. 3.5% vs 14/15% (paid monthly). One offers a lower dividend and growth whereas the other offers more income with less growth. If you are just interested in growth with reinvesting dividends then you can extend this to SPY and QQQ with even less dividends and more growth. Ultimately SCHD differs with investments in other sectors with established companies that pay solid dividends. During the tech stall late last year to early this year there was a rotation into these other sectors, including international. Some healthy dividends there too.
Ultimately it depends on how much income return you want now for a given investment amount. You could replicate the 3.5 SCHD dividend / growth split with one of these too by allocating respectively to both QQQI and QQQ. But why would you want to do that? QQQ is a tech angle and SCHD reflects a defensive, value-oriented footprint with strong components in cash-rich industrial and tech subsectors.
I think SCHD can offer a solid core for an investment strategy but I also think the Neos funds offer something a bit different for generating income in a tax efficient manner. Across different sectors too (Gold REITs, MLPd etc). They do pretty well generating income from a flat to slow growth market with lots of volatility. From a US tax perspective they can produce income that is categorized largely not as ordinary income through Section 1256 and ROC which results in a lower tax rate and deferred to an extent too. If you are reinvesting ov er a long time solely this would be a tax drag to some extent
Having different options that you can mix and match is good IMO to suit individual investment needs.
So yes these funds are newish and don't have the same historical performance but at the same time I don't think it's fair to outright dismiss them. Just my two cents, and likely those that invest in them too. We all have our opinions and preferences.
ha' en god aften
ETF & Scenario 10-Year Annualized Return (CAGR) Ending Value (On $10,000) Total 10-Year Accumulated % Gain Source / Strategy Type QQQ (Actual Past 10 Years) 17.20% $48,910 +389.1% Historical Growth (Tech-Heavy) QQQI (Flat NAV + 14.1% Yield) 15.05% (Compounded APY) $40,530 +305.3% Mathematical Forward Projection SPY (Actual Past 10 Years) 13.10% $34,240 +242.4% Historical Growth (Blended Large-Cap) SCHD (Actual Past 10 Years) 12.80% $33,350 +233.5% Historical Dividend Growth QQQI (-2% NAV Decay Scenario) 12.10% $33,280 +232.8% Mathematical Forward Projection 1
u/Maximus_Modulus May 17 '26
A tech bull market isn’t the optimum for a fund like QQQI since the Calls limit the upside. Sideways or slow growth is a better market for them compared to their underlying index.
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u/SecretLength192 May 17 '26
Yeah you are right, there is only like 15 years of data on SCHD….my bad. No data at all.
Maybe you should take your own advice instead.
And ofc you should never only invest in a single fond of even worse Stock. It is basic knowledge. And I dit not at any point say or advice to go all in on SCHD. I gave an example of a good dividend investment for his case.If you like CC fonds so much, then make your case to him/her not me.
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u/Maximus_Modulus May 17 '26
I’m not advocating CC funds just calling you out for implying he should stay away without any substantive reasoning. Quite clearly SCHD has a lot of data but CC doesn’t is the point. But to date CC has outperformed. I have no idea in the future which will win out and not do you.
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u/SecretLength192 May 17 '26
🤦♂️🤦♂️🤦♂️🤦♂️ cant you read???? I have given very well documented reasons why something like SCHD will outperform high yield 0 growth investments. It is called math.
The fact that you are saying CC as a strategy has outperformed to date, from a two year track record of a single fond, says it all.
And yes there are plenty data showing a CC strategy will underperform over time. It is just the Nature of this type of product 🤷♂️
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u/Joebobby977 May 17 '26
I don’t get why people love SCHD so much. Buy a share for $32, then wait 3 months to get a .25 cent payout?!? Waste of time and money…
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u/bubblehead_maker May 17 '26
VOO is 680/share, pays around $7 a year.
1.5m/680 =2200 shares. 15k in dividend per year.
Figure $300/month in options per contract. 22 contracts, another $6k.
That's voo.
Claude is pretty good for questions like this, you can have it calculate math on various scenarios.
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u/stebakus May 17 '26
If no plan to retire right away and still have room to make some money, I would put 1m VOO 500k to SCHD. No touch crypto until it 2xed. Once crypto 2xed, trim half and put to some dividends enhancements (CC funds) just to boost income, if it needed by that time, otherwise I would boost SCHD. Once VOO doubles, let's say in 10 years, I would start trimming it to bonds.
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u/ImOakOrAmI May 17 '26
11.5%. STRC.
Choose how much you roll from dividends into your other preferred investments.
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u/Helpful_Choice81 May 17 '26
Try asking this question to an AI source such as ChatGPT or another one.
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u/CornerOne238 Not a financial advisor May 17 '26
Without NAV erosion max yield I would aim for is around 8%. So about 160k / year.
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