Need $240k to get $1k/month income.

[RetiredHappy]

Or you can take half the amount buy a SPIA, term annuities, some mix of the 2 if you don't care about the principal.

 

[COcheesehead]

Funds don’t want to buy something that will default. The higher income comes mostly as the result of leverage.

 

[Koolau]

Funds don’t want to buy something that will default. The higher income comes mostly as the result of leverage.

I've never felt comfortable investing in funds with leverage. I investigated Edward Jones for about 5 minutes some 20 years ago. The guy at Fast Eddie wanted me in closed end funds.

I didn't sign up with him. So glad that I did not (for more reasons than just closed-in funds).

 

[COcheesehead]

I've never felt comfortable investing in funds with leverage. I investigated Edward Jones for about 5 minutes some 20 years ago. The guy at Fast Eddie wanted me in closed end funds.

I didn't sign up with him. So glad that I did not (for more reasons than just closed-in funds).

If you ever bought a house using a mortgage, you are using leverage.
Like any investment they have to fit your risk profile. There’s nothing scary about closed end funds if you understand them and the right ones can really boost your income. My portfolio is living proof. I am up over six figures YTD in a somewhat crummy market.

 

[Koolau]

If you ever bought a house using a mortgage, you are using leverage.
Like any investment they have to fit your risk profile. There’s nothing scary about closed end funds if you understand them and the right ones can really boost your income. My portfolio is living proof. I am up over six figures YTD in a somewhat crummy market.

I'm sure you're right. I did buy a house (or 3) with a mortgage but I felt I had a good understanding of the leverage involved. I have only the slightest of understanding of closed end funds and decided they were not for me. For one thing, your chances of exaggerating a loss seemed much greater with a closed end fund than with a mortgage.

 

[COcheesehead]

I'm sure you're right. I did buy a house (or 3) with a mortgage but I felt I had a good understanding of the leverage involved. I have only the slightest of understanding of closed end funds and decided they were not for me. For one thing, your chances of exaggerating a loss seemed much greater with a closed end fund than with a mortgage.

The leverage is the same. You are borrowing to buy more of an asset than your cash would allow you to purchase otherwise. The difference is your house pays you in appreciation (and lodging) or at least should. A bond CEF pays you monthly income. In both cases if earnings cover the leverage expense, you’re fine.

 

[perrytime]

I think preferred stock from Morgan Stanely is very safe, the E shares pay over 7%, qualified dividends. Would make that part of the holdings,