Income Investing Results

[COcheesehead]

You get a reinvestment discount of 5% if the market NAV is at a premium.

 

[Flyfish1]

I did not know that - thank you.

 

[Flieger]

Well, not a bad start to June. Wk 1:

Flieger

 

[HappilyRetired]

I have been retired 10 years. In 2024 we started living on our dividends and interest, also SS. Up until then, we had reinvested all dividends. We own BDC, REITS, Growth stocks, stellar boring stocks and CEFs.

Like many here, I don't pay much attention to the VALUE of our portfolio's fluctuation, as the dividends and interest just keep coming, no matter what the stock market does. Rarely do we have an investment which decreases its dividend. We try to buy the best, in each sector:

BDC: MAIN, ARCC, CSWC, FDUS, GBDC, HTGC, CCAP, TRIN
CEF: PDI, PDO, PDX
Stocks: BTI, MO, VZ, T, UNH, PEP, KO, BP, XOM, MSFT, NVDA, CRWD, AAPL, C, ORI, OKE, ENB (the list goes on, we own over 60 stocks, kind of like creating our own Mutual Fund)
Mutual Funds: VFIAX, VDIGX
ETF: SCHD

Have been investing for over 50+ years, buy for LONG hold, and do not engage in options or day trading.

 

[Flieger]

BDC: MAIN, ARCC, CSWC, FDUS, GBDC, HTGC, CCAP, TRIN
CEF: PDI, PDO, PDX
Stocks: BTI, MO, VZ, T, UNH, PEP, KO, BP, XOM, MSFT, NVDA, CRWD, AAPL, C, ORI, OKE, ENB (the list goes on, we own over 60 stocks, kind of like creating our own Mutual Fund)
Mutual Funds: VFIAX, VDIGX
ETF: SCHD

Nice list of holdings!

Flieger

 

[COcheesehead]

With yesterday’s market action, the total portfolio is back at its all time high last achieved in early March….for about a day. LOL. We’ll see how long it sticks this time.

 

[Flieger]

If I remove my "income W/D's" I am very close to my start of year balance, while doing reinvestments for increased Div's to account for inflation. I'll take that during this turbulent market period and during my pre-SS time.

2H25 will be a little tougher to do this as with my DW's retirement from a JOB this month, we will have to start marketplace insurance and increase my W/D's a bit.

Flieger

 

[Steelpony]

I think there's been a long-time debate on HOW to build and access the income required.

There are those who use the "total return" approach which includes organic growth and reinvested dividends/interest, selling shares as necessary to keep body and soul together, and then there's folks like me who prefer to not sell shares (even though you really are) and rely on funds/stocks that provide dividends and set them aside for consumption. We all get to about the same place but as noted it is often more a matter of methodology than anything else.

This is a really long thread and reading through I just stumbled on this.

I think a better way of handling “labels” like these are do you liquidate assets only by some rule each year a TR investor or are you solely living on income from a variety of sources yearly? Most are probably a combo of the two unless you’re really off or frugal.

 

[pb4uski]

^^^ Might be either, like if you just rebalance annually to a target of x% stocks, y% fixed income and z% cash. So for example if your z% in cash is two years of spending withdrawals, then when you replenish the cash you would sell stocks if stocks have done well and sell bonds if bonds have done well.

 

[COcheesehead]

$12,494 in dividends captured this week, payable on or near July 1st. $12,121 in tax free bond ladder interest payable on Monday.
I sit at an all time portfolio high by the hair of my chinny chin chin.

 

[Flieger]

I sit at an all time portfolio high by the hair of my chinny chin chin.

That's incredible considering Friday's hit! Awesome!

I'm back to -3.5% YTD, that does include my YTD distributions...

Flieger

 

[COcheesehead]

That's incredible considering Friday's hit! Awesome!

I'm back to -3.5% YTD, that does include my YTD distributions...

View attachment 56324

Flieger

In whole dollars I lost about $20,000 yesterday, but I am still up over my ATH by about $14,000 so pretty slim

 

[Steelpony]

Well investing isn’t really my hobby but it is a pastime.

I consider myself an income investor interested in cash flow only. Values vary each day so they’re are not as dependable to me as a retiree. This relegates any cap gains as secondary income for us if ever needed.

I checked my stats going back to 2018 as best I could. As a retiree our portfolio is 1 part VTI, 1 part 16 CEF’s, 1 part 3 conventional bond funds and 10% cash. So 20 holdings with VTI growing as a set aside if ever needed for any end of life issues.

YTD it’s up in value after monthly withdrawals 1.9%. Going back to 2018 value growth has increased 6.8% a year after withdrawals driven up by investing excess cash to current needs and compounding.

 

[COcheesehead]

Just did my semi annual proforma 1040 at Dinkytown.
Our income for 2025 has increased by about 18% from the start of the year.
As of now our taxes will be cut by $9000 from last year and we are due a refund at this point. So I can add a little more taxable income without consequence.

 

[Fotodog]

I have a bond ladder consisting of mostly corporates going out about 7 years. As bonds mature or are called I have been buying new positions at the end of the ladder. What I’m finding now is that there are often better options if I skip a year. For example, 2034 has better choices than 2033. For those of you who use bond ladders, do you skip some rungs in your ladder if that means better rates?

 

[TickTock]

For those of you who use bond ladders, do you skip some rungs in your ladder if that means better rates?

I haven't yet (as I've not seen what I consider significant yield differences between adjacent rungs), but I'd probably do so if the opportunity arose.

 

[RF]

Whew, that was quite the read. Our portfolios (two 401k accounts - mine and my wife’s, brokerage, and two small Roths) are only partly set up for income at this point. As of now (really next year, when we need to draw) we can fund 40-50% of the gap via I, D, and CGD from the brokerage. The rest will be drawn from the money we have in the “Income Fund” in our 401k accounts, and should be basically just the annual gains. We’re slowly (due to large capital gains) moving brokerage stuff to more income generators. That said, the 401k income fund is really just cash, so I am considering using more of that. Will also help reduce what would be large RMDs later on.

Not ideal, but it should get the job done.

 

[Waynew]

June is on track to beat all previous June payments. dividend growth is working just fine. This does not include dividends in our grandchildren's UTMA accounts. I also have significant income from covered call and cash covered put options. June 2024 dividend income was $21,867.22 and June 2023 was $21,763.20.

 

[Tacitus]

@Waynew

Impressive. Curious. Why no inclusions of debt cefs with their large distributions as discussed on the cef thread or am I missing something? E.g. PDI, PHK, PAXS, PFN, KIO. WDI and the others?

 

[Waynew]

@Tacitus
I'm not opposed to CEFs, but I have two focal points: Dividend growth and total returns.
Perhaps this comparison might shed some light...

 

[Tacitus]

@Waynew

That is what I thought. Understood. Your focus not just on income but total returns/performance. Hard to disagree with that. Thank you for confirming.

PS-Additionally, though you did not also offer, for assets held in taxable accounts, income from equity dividends taxed much more favorably I believe than the debt cefs. So probably even more of a differential in performance than you illustrated.

 

[Waynew]

@Waynew

That is what I thought. Understood. Your focus not just on income but total returns/performance. Hard to disagree with that. Thank you for confirming.

PS-Additionally, though you did not also offer, for assets held in taxable accounts, income from equity dividends taxed much more favorably I believe than the debt cefs. So probably even more of a differential in performance than you illustrated.

The vast majority of our dividends are in my IRA and ROTH IRA. My wife's ROTH and traditional IRA are smaller, but those four accounts are the lion's share of our assets. Brokerage accounts total less than $100K There are a total of eight accounts in our total portfolio, excluding a very small set of investments in Robinhood. That account is just to teach teenagers the huge differences in capabilities between Robinhood and other platforms.

 

[Flieger]

Wayne is where I hope to be after starting SS and don't need to take as much risk. He has a
'stash' that allows great income with much less risk and more focus on growth.

Flieger

 

[Flieger]

I copied dickoncapecod and started another Thread titled Income Investing Results - July since this has over 500 posts. Let's move over there.

Flieger

 

[HappilyRetired]

Just did my semi annual proforma 1040 at Dinkytown.
Our income for 2025 has increased by about 18% from the start of the year.
As of now our taxes will be cut by $9000 from last year and we are due a refund at this point. So I can add a little more taxable income without consequence.

COcheesehead: I am trying to move as much as I can from our T-IRAs into our ROTHs each year. Of course it is a taxable event. But how awesome is the ROTH!!!......no tax on dividends, capital gains, nothing , nada, zip, zilch...no tax...Currently we receive about $37k just in dividends from our ROTHs.. Totally non-taxable. This is so wonderful. But my RMD starts in 2 years so the window is closing...Today we get to deduct another $12k (joint return) on income....this helps as we aren't over the $150k limit in income because we have the ROTH to pay us so handsomely...it's all about tax strategy.......Have a Happy 4th!