Inflation hasn’t been a problem for a long time. In fact, central banks around the world have been fighting deflation, as low growth, pessimistic expectations and slumping oil prices kept prices in check since the 2008/09 crash.

That’s changing, and more people—from economists to everyday consumers—see inflation heating up. That makes now a great time to buy into an asset class few investors pay attention to. I’ll explain why, and name two of my favorites, in a moment.

First, back to inflation: according to the New York Federal Reserve, consumers now expect prices to swell by 2.8%—the highest reading since the middle of 2015.… Read more

Not every high yield asset is in danger as rates rise. While some stocks paying 3% may feel the Fed’s pressure, there’s a higher subset paying 8% that should do just fine.

If you’re looking for dividends you can actually retire on, you should familiarize yourself with business development companies (BDCs). They tend to pay big yields because they are required by law to dish most of their profits back to their investors as dividends.

BDCs themselves are investment companies that provide funding to small- and mid-size companies (which typically have a difficult time acquiring funding from larger financiers). BDCs were brought to life in 1980 by Congress to spur U.S.… Read more

“Efficient market” proponents are wrong – you can bank returns of 10%, 12% or more from stocks regularly.

But you need to ignore common Wall Street “wisdom” and follow a simple 3-step formula that I’ll outline for you in a moment.

Most individual investors don’t make anything close to 10% per year because they practice “buy and hope” investing. They pick up shares and root for them to appreciate in price. With no specific plan outlining how they are going to profit from their stocks, they are doomed.

Even “tangible” fundamental drivers like higher sales or profits are no guarantee that you will profit.… Read more

I’m sure you’ve heard that you can’t beat the market. It’s the prevailing wisdom—and it’s why passive index funds are more popular than ever.

But by that logic, picking stocks is pointless. And actively managed funds? You’ll find no joy there, either, because most managers underperform … and charge you outrageous fees for doing so.

That pretty much leaves us with one option: stick all our cash in a low-fee passive fund like the Vanguard Total Stock Market ETF (VTI) and call it a day, right?

Wrong.

The truth is, there are literally hundreds of funds out there that have been outperforming the market for a long time. … Read more

By now, I bet you’re sick of “Best Stocks for 2017” articles.

That makes two of us.

So today, we’re going to take the long view, starting with a strategy you can use to steadily bulk up your nest egg—even if you’re 10 years or less out from retiring—and trigger a reliable income stream once you do.

Then I’m going to reveal 5 of my favorite dividend-growth retirement stocks to buy now.

“Wait a minute,” you’re may be thinking. “Aren’t dividend payers going to get crushed as interest rates rise?”

2 Keys to Beating Rising Rates

I have two answers to that.… Read more

If you want to diversify, get high-quality dividend growth and avoid risky speculation, the SPDR S&P Dividend ETF (SDY) may seem like a no-brainer.

But buying this fund would be a big mistake.

Today I’m going to show you why … and help you avoid a couple other seemingly obvious moves that could steer you into big trouble in 2017. Further on, I’ll reveal a terrific fund to buy now and tuck away for two decades or more.

First, back to SDY, which has handily beaten the S&P 500 over the past decade:

A Long-Term Outperformer

At the same time, more dividends have been paid out, and SDY’s payout is now larger than the broader market’s:

A Strong Income Stream

So why not just buy this fund and call it a day?… Read more

Vanguard’s offerings don’t usually attract much attention from income investors. But they should – and I’m going to analyze five of the firm’s highest yield (and low cost) offerings shortly.

Three of them are compelling portfolio conveniences, while two have lagged their competitors in disappointing un-Vanguard-like manners.

While Vanguard provides a few actively managed funds, for the most part, it sticks to basic index funds and straightforward smart-beta funds in both the equity and bond arenas. The firm doesn’t delve much into the kinds of riskier strategies that tend to result in higher yields, nor does it deal in exchange-traded notes or leveraged funds that would allow it to gin up extra income.… Read more

What will 2017 hold for income investors?

Let’s sort through the current hysteria regarding interest rates, Trump and inflation. Thanks to some first-level insanity, there are once again pockets of value that pay meaningful dividends of 6%, 7% or better.

And many have some price upside to boot! Why?

Because Rate Hikes Will Probably Disappoint

This time last year, the Fed was promising four rate hikes over the next twelve months. The “smart money” crowd (via Fed Funds futures prices) was betting on two. And both parties were too aggressive as we saw just one rate hike in 2016.

Today we have Yellen & Co promising three hikes in 2017, while the futures markets say just two:

The Smart Money Bets 2 Hikes in 2017

Given their track records, I’m inclined to take the “under” on both predictions.… Read more

2016 is in the books, and the S&P 500 gained over 11% on the year. That’s great news if you’re already in the stock market … but it’s bad news if you’re looking to buy.

The market’s price-to-earnings (P/E) ratio is now 26.1, which is 17.6% higher than it was at the beginning of the year. In other words, if you buy stocks now, you’re paying nearly a fifth more for those companies’ earnings than you would have nearly 12 months ago.

Stocks Getting Expensive

Making matters worse is the fact that the S&P 500 has soared over 8% in the last two months alone—accounting for much of the year’s total gains.… Read more