Income investing is a strategy focused on generating a regular and steady flow of income from investments, primarily through dividends, interest, and other forms of cash distributions. This approach is particularly appealing for retirees or individuals seeking a consistent income stream without needing to sell their investments.
Types of Income Investments
Several types of assets can be considered for income investing, including:
Dividend Stocks: Shares in companies that regularly distribute a portion of their earnings to shareholders. Bonds: Debt securities that pay periodic interest to investors. Real Estate Investment Trusts (REITs): Companies that own, operate, or finance income-producing real estate. Preferred Stocks: A type of stock that pays fixed dividends before any dividends are paid to common stockholders. Mutual Funds and Exchange-Traded Funds (ETFs): Funds that focus on dividend-paying stocks or bonds.