The Schwab U.S. Dividend Equity ETF is having a massive year while providing steady passive income. Boring investments held for the long term are how wealth gets built. x.comÂ
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The Schwab US Dividend Equity ETF's dividend growth is underrated and can make it a stronger income investment than high-yield funds. A 3.5% yield growing 8-10% a year could become far more powerful than an 8-10% yield ETF with no dividend growth. Income can beat inflation, and spending the dividend leaves no NAV erosion, so principal keeps growing. x.com x.comÂ
The Schwab U.S. Dividend Equity ETF can generate meaningful passive income. Holding 20,000 shares at roughly a $0.25 quarterly dividend would pay about $5,000 every quarter without effort, enough income for some people to retire on. x.comÂ
SCHD, the Schwab U.S. Dividend Equity ETF, is great for passive income in retirement but not for wealth accumulation, which makes it a poor choice over the S&P 500 for a child's long-term portfolio. As @1031ent notes, young holders also have to pay taxes on its dividends. x.com x.comÂ
Quality dividend stocks look like a great place to be over the next few years as the crowded tech trade unwinds. Per @PeterBerezinBCA, in the early dotcom bust tech crashed while the rest of the market rose, so the hedge for stocks was other stocks. A quality dividend basket holds old-economy, cash-generative businesses at sane multiples, while the index hides 50% of its weight in names at 10 times sales. That outweighs a general dislike of dividends as inefficient, taxable compounding. x.com … Show more
Schwab US Dividend Equity ETF pays more to live on in retirement than an S&P 500 fund. At its 12.93% annualized total return since 2011, $500 a month from age 25 to 62 grows to about $4.41 million, and its 3.46% yield then pays about $152,000 a year without selling a share. The same plan in Vanguard's S&P 500 ETF builds a bigger $6.17 million pile but pays only about $73,000 a year in dividends. x.comÂ
Broadcom, Visa, Mastercard, Microsoft, JPMorgan, Costco, Apple, Home Depot, Lowe's, American Express and the DGRO, VIG and SCHD ETFs suit a dividend growth strategy, the best way to live off dividends. Payouts growing 5-8% a year can outpace inflation, and living on dividends means never selling in a crash. Steady dividend raises filter for stable cash flows, quality and solid management, dividends are easier to forecast than prices, and reinvesting them before retirement compounds share count. … Show more
Pairing dividend-growth stocks with large-cap growth stocks can speed up retirement: owning dividend-growth stocks alone supports retiring at 60, while adding growth stocks could allow retiring in your 40s. x.comÂ
Holding broad US stocks compounds returns; crash selling and overtrading destroy that advantage. Most would be dramatically richer holding quality stocks or the market for life. The S&P 500 has compounded roughly 10% a year with dividends reinvested; DALBAR's studies show investors lag by 1-3 percentage points or more annually from behavior. Random stock buy-and-hold usually fails: durable quality or broad diversification captures the few firms creating almost all wealth. x.comÂ
The VUS ETF should keep a 3.5-4% yield over the next five years while delivering high growth that crushes SCHD. Its top holdings are Apple, Nvidia, Broadcom, Microsoft and Micron, yet it pays a dividend of over 3%, and no one is talking about it. x.comÂ
Durable dividend stocks such as Johnson & Johnson, Coca-Cola, Realty Income, PepsiCo, Procter & Gamble, Sherwin-Williams, Visa and Federal Realty can become a lifetime income machine. The key is owning businesses so durable that investors sleep well while dividends and compounding do the work, rather than chasing yield. x.comÂ