Many investors think they must choose between income and growth.

Why not have both?

Many stocks offer varying degrees of growth and income, and in a few rare cases – such as the three stocks yielding between 7% and 9% that I’m going to share with you today – they offer high levels of both.

When we talk about “growth,” we can mean any number of metrics. It can be as simple as sales, but that’s far from the only metric that matters.

The growth I want to look at today is on the bottom line. A company can grow sales all day by spending inordinate amounts of money on marketing and R&D.… Read more

The biggest complaints about the Dividend Aristocrats tend to come from new money. That’s because many of them, while generously raising their payouts year after year, offer skinflint yields that average 2.35% – almost right on par with the 10-year T-note.

You can find a little more relief from a similar club: The High Yield Dividend Aristocrats. This is a group of roughly 110 S&P Composite 1500 stocks that has paid and increased dividends for at least 20 consecutive years. It’s slightly less exclusive than the S&P 500 Aristocrats, and doesn’t actually yield much differently on average, but the larger selection includes several higher-yield growers that I want to highlight today.… Read more

It’s one of the biggest worries I hear from investors who hold bonds: what’s going to happen to my portfolio when the Federal Reserve raises interest rates?

My short answer is always the same: don’t worry—it’s not as big of a deal as you think.

That’s true for many bond funds out there—but there are some that are still ticking time bombs because they’re poorly managed. The worst offenders are the ones that aren’t managed at all—the “dumb” funds that blindly track the index and keep a ton of bonds from near-bankrupt companies alongside much better issues.

Funds like the iShares iBoxx High Yield Corporate Bond ETF (JNK) and the SPDR Bloomberg Barclays High Yield Bond ETF (HYG) are the worst offenders here.… Read more

In late 2007, Citigroup (C) insiders – who should have known better – comforted themselves with a security blanket that, in hindsight, was better fit for a Goodwill donation.

“The dividend’s as safe as the next board meeting,” they told themselves as the yield on their shares climbed well above 10%. On a trailing basis, that is.

Next board meeting, their payout was chopped – and their shares dropped more than 90%.

Stock yields of 10%, 11%, 12% or more are usually too good to be true. Citigroup reminded us why ten years ago, and telecom disaster Frontier Communications (FTR) reinforces the point today.… Read more

If you make just one New Year’s resolution this year, make it this: buy monthly dividend stocks. Today I’m going to give you 3 that should be at the top of your list.

The benefits of monthly payouts go way beyond the convenience of getting paid every month, just as our bills show up (although that’s a great bonus that can save you a lot of time watching your cash flow in retirement).

There are a couple other overlooked benefits monthly payers give you:

• They’re a sign of dividend safety: Smart C-suite types know that a dividend is a promise to investors, and they wouldn’t commit to sending one out every month if they weren’t serious about keeping—or raising—the payout.

I’ve been getting a lot of emails from readers worried about how closed-end funds (CEFs)—especially bond-oriented closed-end funds—will perform next year, when the Federal Reserve raises interest rates.

And that’s definitely a when and not an if—there is too much good economic data to suggest the Fed will back off its rate-hike plans, which both it and most US legislators desperately want to happen.

(A couple weeks ago, I gave you my outlook for the US economy in 2018 and named 5 non-bond CEFs to buy before the New Year arrives. Click here to read that article.)… Read more

Congressional Republicans are closer than ever to passing wide changes to America’s tax code. From 10,000 feet, they largely feature:

• Varying levels of tax cuts for individuals,
• A massive tax cut for businesses, and they
• Weaken (or negate) the estate tax.

There’s debate regarding how much individuals will actually benefit, but there’s little debate that certain public companies will gain. Both the Senate and the House are looking to cut the corporate tax rate from 35% to 20%. Plus, companies will be allowed to pay a low, one-time repatriation tax on profits already sheltered overseas.

The idea is that U.S. corporations will use this windfall to hire more people, and many likely will … but that’s not the only place that money is going.… Read more

The tax reform debate in Washington is roiling the municipal bond market—and that’s setting up a screaming buying opportunity for contrarians on the hunt for income.

I’ll tell you why, and show you exactly how to cash in, in a moment.

First, if you’ve been watching “munis” for any length of time, I probably don’t have to tell you that muni-bond investors detest uncertainty.

That’s because they’re risk-averse folks who just want a high, tax-free yield on their money.

After all, that’s what municipal bonds are for; they offer higher yields than US Treasuries; they’re untaxed for most Americans, unlike federal bonds and stock dividends; and their prices don’t fluctuate much.… Read more

As income investors react to the new tax plan, it’s a good bet that some are overreacting to certain aspects of it. They always do.

There’s confusion between high yielding fixed income, and pure junk. There’s also a flood of tax-advantaged paper about to hit the market, creating bargains for smart buyers.

The result? Yields up to 10%, with some price upside to boot!

Bargain #1: “Smart” High-Yield Bond Funds for 7.5%+

If you hold high-yield (often called junk) bonds, you may have noticed they’ve sold off as the Republicans’ tax talk became serious. They’ve taken down other assets, too – some for good reason, some not.… Read more

I’ve spoken to a lot of investors who are still scared of real estate after the housing bubble burst in 2008. These folks have a lot of cash on the sidelines, and they’re desperate for income, but they’re too scared to jump into real estate.

Usually when investors express these fears, I show them this chart:

Real Estate Beat Stocks in the Real Estate Crash

This is a chart of the SPDR S&P 500 ETF (SPY) and the SPDR Dow Jones REIT ETF (RWR). The latter only holds real estate investment trusts (REITs), which are companies that rent out real estate and pass most of the rental income to shareholders as dividends.… Read more