Schwab US Dividend Equity ETF (ARCA: SCHD)

Últimas noticias sobre Schwab US Dividend Equity ETF (ARCA:SCHD)

Schwab US Dividend Equity ETF

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To pursue its goal, the fund generally invests in stocks that are included in the Dow Jones U.S. Dividend 100 Index. The Dow Jones U.S. Dividend 100 Index is designed to measure the performance of high dividend yielding stocks issued by U.S. companies that have a record of consistently paying dividends, selected for fundamental strength relative to their peers, based on financial ratios. The 100-component index is a subset of the Dow Jones U.S. Broad Market Index, excluding real estate investment trusts (REITs), master limited partnerships, preferred stocks and convertibles. It is modified market capitalization weighted.

Lockheed Martin Corp

Abbvie Inc.

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Blackrock Inc.

Amgen Inc.

Cisco Systems, Inc.

Coca Cola Co.

Texas Instruments Inc

Chevron Corporation

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Verizon Communications Inc Common Stock Usd 0.1

Pepsico Inc.

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Las 10 mejores participaciones en dividendos de un jubilado de Reddit, que vive cómodamente de los pagos de dividendos.

Jubilado comparte sus 10 principales participaciones en dividendos para una jubilación cómoda

Reddit Inc. RDDT

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Invertir en acciones y fondos es una de las formas más poderosas de construir 

¿Cómo invertir $250.000? Reddit debate entre acciones, ETF y criptomonedas

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Verizon asegura contrato de 4M$ y destaca nueva infraestructura de seguridad

Many dream of <a href="https://www.benzinga.com/personal-finance/24/11/41781968/suze-orman-says-if-youre-rich-like-her-then-you-can-retire-early-but-if-you-only-have-2-million-">retiring early</a>, but making it a reality requires careful planning, especially when you want to rely on investment income.
For those who aim to leave the workforce ahead of schedule, a dividend-oriented portfolio is a great strategy as it provides a steady cash flow. Balancing the yield and risk is crucial, though, to enjoy the <a href="https://www.benzinga.com/personal-finance/25/03/44390125/stock-market-timer-with-130k-cash-reserve-debates-nvda-investment-should-i-do-it-differently-or-stick-to-his-high-stakes-plan">investment</a>.
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One Reddit user, an investor with a $640,000 portfolio, is encountering this issue as he plans to retire in five years or less. Heavily invested in Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) with smaller positions in Amplify CWP Enhanced Dividend Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DIVO#NYSE">DIVO</a>), Amplify CWP International Enhanced Dividend Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IDVO#NYSE">IDVO</a>), and Amplify CWP Growth &amp; Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/QDVO#NYSE">QDVO</a>), the poster&#8217;s portfolio generates $27,162 in annual dividend income.
His goal is to build a portfolio that provides inflation-beating dividend growth, but he&#8217;s wondering whether he diversified enough, whether he should introduce bonds when nearing retirement, and whether the current allocation can generate $75,000 per year.
&#8220;I try to live modestly. I live in a small house. No mortgage. No debt. <a href="https://www.reddit.com/r/dividends/comments/1ji8lcd/comment/mjeufff/?utm_source=share&amp;utm_medium=web3x&amp;utm_name=web3xcss&amp;utm_term=1&amp;utm_content=share_button">My current nominal expenses are about $45,000 per year.</a> I'm thinking about diversifying into [Schwab International Dividend Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schy#NYSE">SCHY</a>)] to get a little more international exposure,&#8221; he wrote.
Trending: Many are using retirement income calculators to check if they&#8217;re on pace —<a href="https://www.benzinga.com/money/how-do-i-calculate-my-retirement-income-adv"> here&#8217;s a breakdown on what&#8217;s behind this formula.</a>
The Reddit community weighed in, offering advice and insights, so let&#8217;s analyze the suggestions below.
<h2 class="wp-block-heading">Can The Current $640,000 Portfolio Generate $75,000 Per Year in Dividends? Reddit Debates</h2>
Increase Yield with Higher-Paying ETFs And Stocks
Several users suggested adding higher-yielding assets to boost income, mainly since the investor&#8217;s 4.24% yield may not cover his $75,000 target.
&#8220;Try getting more yield exposure. [Broadcom (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/avgo#NASDAQ">AVGO</a>)], [Nike (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/nke#NYSE">NKE</a>)], [Visa (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/v#NYSE">V</a>)], [The Home Depot (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/hd#NYSE">HD</a>)]–all have high 5-year [compound annual growth rate]. Yield: [MPLX LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>)], [JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/jepq#NASDAQ">JEPQ</a>)], [Guggenheim Strategic Opportunities Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/gof#NYSE">GOF</a>)], [Ares Capital Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/arcc#NASDAQ">ARCC</a>)​], [VICI Properties (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vici#NYSE">VICI</a>)], [PIMCO Dynamic Income Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pdi#NYSE">PDI</a>)],&#8221; a suggestion reads.
A Redditor advised the investor to allocate two parts of the portfolio to a covered call ETF and a high-yield fund since they pay well and the gains are great.
&#8220;Add JEPQ and [Goldman Sachs S&amp;P 500 Core Premium Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/gpix#NASDAQ">GPIX</a>)]. You will have good gains from those and they pay a lot.&#8221;
A commenter suggested Ares Dynamic Credit Allocation Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ARDC#NYSE">ARDC</a>), a business development company because it offers nearly double the yield of SCHD.
&#8220;ARDC is a monthly payer, now at a good entry point at $14.14-ish with a 9.9% dividend, currently paying $0.1125/share monthly. Just went x-dividend. I hold 5,000 shares of ARCC (for several years) and 5,000 shares of ARDC (a more recent position),&#8221; he said.
See Also: Have $200K saved?<a href="https://www.benzinga.com/money/have-200k-saved-heres-how-to-turn-it-into-lasting-wealth"> Here's how to turn it into lasting wealth</a>
Focus on Dividend Growth and Compounding
Many Redditors suggested that dividend growth stocks and ETFs are ideal for long-term retirement income, with many sharing what they do to ensure compounding growth for their portfolios.
&#8220;A well-diversified dividend portfolio with a disciplined reinvestment rate should be easily able to weather most storms. And you become a net buyer of shares every year, not a seller. That $640,000 could easily and safely do 8.5% gross and provide a 25% reinvestment rate and still net $40,000/year. I&#8217;m living it,&#8221; a Reddit user said.
&#8220;Nice and consistent portfolio. SCHD, DIVO, and IDVO are very consistent in growth and dividends. Don't know much about QDVO, but I am sure if it's similar to DIVO it's a good pick. I like your portfolio!&#8221; another commenter wrote.
A retiree shared that his income from dividend-focused shares continued to pour even during market corrections and that he&#8217;s reinvesting part of his distributions, growing his wealth year after year.
&#8220;My dividend income didn&#8217;t miss a beat during corrections in 2022, etc. Since I retired 15 years ago, I never sold shares except to rebalance. I reinvest part of my distributions during dips, like now, resulting in my portfolio being over twice what it was when I retired,&#8221; he said.
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<li>Can you guess how many retire with a $5,000,000 nest egg? <a href="https://www.benzinga.com/money/5mil-nest-egg-adv">The percentage may shock you</a>.</li>
</ul>

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Amplify ETF Trust Amplify CWP Growth & Income ETF

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Investor With $640K Portfolio Aims For Early Retirement – 'Hoping To Retire In 5 Years Or Less' But Faces Tough Choices – Reddit Weights In

A Redditor recently cast doubt on one of the most popular retirement vehicles: the Roth IRA. The Redditor <a href="https://www.reddit.com/r/dividends/comments/1jj82bs/i_am_honestly_a_little_confused_and_wanting_some/">posted in the Dividends subreddit</a> about investing aggressively in the Schwab US Dividend ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) and not needing a Roth IRA. The Redditor shared some calculations that show he can earn $50,000 to $70,000 each year from SCHD in 20 years. Based on that logic, the Redditor was wondering if a Roth IRA makes any sense.
The comments section quickly explained why Roth IRAs are valuable and how they can help the Redditor maximize their returns.
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<h2 class="wp-block-heading">Roth IRAs Result in Zero Taxes on Dividends and Gains</h2>
The main reason people invest in Roth IRAs is to avoid taxes on dividends and capital gains. While that's advantageous for any investor, it's especially beneficial for dividend investors. That's because SCHD's dividend distributions are normally taxable. While you won't have to pay at the ordinary income tax rate, you still end up with taxes on SCHD that will limit your portfolio's growth.
SCHD currently has a 30-day SEC yield of 3.71%. Buying shares in a Roth IRA allows you to avoid any taxes on that yield. Furthermore, the capital gains are also tax-free if you decide to sell SCHD in the future.&nbsp;
Trending: BlackRock is calling 2025 the year of alternative assets. <a href="https://www.benzinga.com/money/masterworks">One firm from NYC has quietly built a group of 60,000+ investors who have all joined in on an alt asset class previously exclusive to billionaires like Bezos and Gates.</a>
<h2 class="wp-block-heading">The Redditor Used an Inaccurate Model</h2>
The Redditor makes several assumptions to assume their SCHD position will generate $50,000 to $70,000 per year in 20 years. One of those assumptions is a generous dividend growth rate which some of the commenters question.
One of the commenters mentioned that the yield is unlikely to increase as the model shows. The commenter anticipates that SCHD's yield will hover between 3% and 4%. The Redditor assumes the yield will jump from 3.77% to 6.75% over the next 20 years. It's a very generous assumption since the average company isn't going to give out a 6.75% yield.&nbsp;
A Roth IRA can make it easier to reach that goal. However, the Redditor will have to invest a lot more into SCHD than their model suggests if they want to earn up to $70,000 per year from dividends.
See Also: Can you guess how many retire with a $5,000,000 nest egg? <a href="https://www.benzinga.com/money/5mil-nest-egg-adv">The percentage may shock you</a>.
<h2 class="wp-block-heading">When Do You Plan on Retiring?</h2>
While most Redditors pointed to the benefits of a Roth IRA, there was a small corner of the comments section that agreed with the original poster. If the Redditor can retire before turning 50, then it wouldn't make as much sense to use a Roth IRA.&nbsp;
Those funds won't be accessible until the Redditor turns 59 1/2 years old. If you invest in a brokerage account instead, you can access all of the dividends right away.&nbsp;
This is the best argument against Roth IRAs since some people may want to retire earlier. However, you can also combine Roth IRA contributions with brokerage account contributions. You can have both and use the dividends from your brokerage account to cover your expenses until you can withdraw from the Roth IRA penalty-free.
However, this scenario only matters for people who have a shot at retiring before they turn 59 ½ years old. Someone who retires in their 60s would have benefitted from using a Roth IRA for some of their SCHD investments.&nbsp;
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Redditors Jump in When a Dividend Investor Questions the Need for a Roth IRA: 'That $50K–$70K is all yours, tax-free'

Retirement should be a time of financial peace, not stress; yet, for many soon-to-be retirees, the transition from <a href="https://www.benzinga.com/news/24/08/40147003/rich-dad-poor-dad-author-robert-kiyosaki-sees-wealth-accumulation-in-market-declines-markets-are-cra">wealth accumulation</a> to income generation can be challenging.
The pressure to restructure the portfolio, ensuring it generates sufficient <a href="https://www.benzinga.com/personal-finance/25/03/44461718/high-income-earner-with-3000-monthly-to-invest-faces-big-decision-i-definitely-want-to-diversify-beyond-ai-and-dividends">income</a> to live comfortably, is immense, more so when market volatility looms. For those with low-risk tolerance, the task is even more daunting because the wrong move could mean returning to work or cutting back on living expenses drastically.
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A Redditor has shared in a post that he&#8217;s faced with this exact challenge. With just eight months until retirement, the investor, a 62-year-old, has $400,000 to invest and is looking for maximal monthly dividend income with minimal risk.
Although this income won&#8217;t be his primary retirement funding but extra lifestyle cash to supplement his pension, the pressure to restructure his allocations wisely is immense for the poster.
&#8220;I&#8217;m in an odd spot due to exiting a business as a founder. My retirement scenario gets better every year. If I ever need extra cash, it will be in the first 5 years. I have a low-risk tolerance. Or, God forbid, I would need to go back to work if it crashed! It looks like we are in a dip now, obviously a high rate environment. Would this qualify as a better time to buy?&#8221; the investor wrote.
Trending: BlackRock is calling 2025 the year of alternative assets. <a href="https://www.benzinga.com/money/masterworks">One firm from NYC has quietly built a group of 60,000+ investors who have all joined in on an alt asset class previously exclusive to billionaires like Bezos and Gates.</a>
The responses to his post ranged from ultra-conservative to moderately aggressive, so let&#8217;s analyze them.
<h2 class="wp-block-heading">Soon-to-be Retiree Has $400,000 to Invest for Dividend Income–Reddit Weights In</h2>
Invest in High-Quality Dividend ETFs
Considering the investor&#8217;s low-risk approach, Redditors suggested he pick a few high-quality ETFs to invest in.
&#8220;[Schwab U.S. Dividend Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schd#NYSE">SCHD</a>)] gets you a decent amount,&#8221; a comment reads.
&#8220;[NEOS S&amp;P 500 High Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spyi#NYSE">SPYI</a>)] and chill,&#8221; says a Redditor, to which another user replied, &#8220;One advantage of SPYI is that its dividends are mainly return of capital. So, the tax is lower than an unqualified dividend from, say a [business development company]. However, if you use a tax-advantaged account like the Roth, that doesn&#8217;t matter.&#8221;
A commenter mentioned he splits his portfolio between two ETFs.
&#8220;I split between SPYI and [JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/jepq#NASDAQ">JEPQ</a>)​],&#8221; he said.
&#8220;[​JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)​], JEPQ, [WP Carey (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/wpc#NYSE">WPC</a>)], [Enterprise Products Partners LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/epd#NYSE">EPD</a>)], [MPLX LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mplx#NYSE">MPLX</a>)], SPYI,&#8221; an allocation suggestion reads.
A Reddit user wrote that this favorite individual stock of many investors is the perfect choice since it generates a 7% dividend yield per year.
&#8220;[Altria Group (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mo#NYSE">MO</a>)] &#8211; recession resistant, 7% yield. Your $400,000 would kick out $28,000 a year in income,&#8221; he said.
See Also: Have $200K saved?<a href="https://www.benzinga.com/money/have-200k-saved-heres-how-to-turn-it-into-lasting-wealth"> Here's how to turn it into lasting wealth</a>
Go For Higher-Yielding Income Plays
Several Redditors suggested business development companies and covered-call ETFs since they deliver around 8% to 11% yields if the investor can handle a bit of risk.
&#8220;High-quality [business development companies] like [Ares Capital Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/arcc#NASDAQ">ARCC</a>)​], [Blue Owl Capital Corporation (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/obdc#NYSE">OBDC</a>)], [Golub Capital BDC (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/gbdc#NASDAQ">GBDC</a>)], [Blackstone Secured Lending Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/bxsl#NYSE">BXSL</a>)], [Main Street Capital Corporation (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/main#NYSE">MAIN</a>)], [Capital Southwest Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/cswc#NASDAQ">CSWC</a>)], [Fidus Investment Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/fdus#NASDAQ">FDUS</a>)]. Average 9% yield,&#8221; a user recommended.
&#8220;[Business development companies] are a solid income-producing asset. This person doesn&#8217;t have decades to wait for growth. They need the money now as they are about to retire and growth was presumably the focus for the past few decades,&#8221; an advocate for business development companies wrote.
A Redditor shared in the comments that he&#8217;s been retired for 15 years and has the biggest part of his portfolio in high-yield business development companies.
&#8220;I&#8217;m 78 and have been retired for 15 years. I&#8217;m fortunate that social security and pensions cover my living expenses. The majority of my portfolio is high-yield [business development companies], [closed-end funds], and [real estate investment trusts]. The average yield is a tad over 10%. In 2022, the total value dropped but less than the DOW or S&amp;P. The dividends kept on coming without missing a beat. High risk they say, high rewards I say. It allows me to spend winters in Florida and yearly overseas vacations. I have zero regrets,&#8221; the retiree said.
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<li>Many are using retirement income calculators to check if they&#8217;re on pace —<a href="https://www.benzinga.com/money/how-do-i-calculate-my-retirement-income-adv"> here&#8217;s a breakdown on what&#8217;s behind this formula.</a></li>
</ul>

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62-Year-Old With $400K And 8 Months To Retire Faces Huge Dilemma – 'How Would You Invest $400K?' Redditors Debate Best Low-Risk Moves

Dividend investing is back on investors' radar after taking a backseat during the AI-led bull run. With tariff uncertainties and fading momentum in AI stocks, investors are looking for stable dividend-paying companies to navigate the current market turbulence. But it's not easy to find quality dividend stocks as it requires assessing factors like yield, payout ratio, financial stability, and growth potential.&nbsp;
Let's turn to a dividend investing case study for ideas and inspiration.
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</ul>
Last month, someone asked income investors on r/Dividends — a Reddit community with 690,000 members — whether it was realistic to live off dividends and how much investment is needed to reach at least $50,000 in annual dividend income. The question also asked Redditors to share how long it takes for the average investor to reach a dividend income that covers basic expenses.
The question received hundreds of comments, but one story caught our eye.
An investor said he was making $175,000 a year in dividends and retired two years ago at the age of 48.
"I'm still not touching them, especially now. I have a small passive business that generates enough to cover my expenses. I've recently gone about 1/3 short term government bonds because I'm VERY worried about a recession," he said.
Trending: BlackRock is calling 2025 the year of alternative assets. <a href="https://www.benzinga.com/money/masterworks">One firm from NYC has quietly built a group of 60,000+ investors who have all joined in on an alt asset class previously exclusive to billionaires like Bezos and Gates.</a>
The investor, 50, said his total portfolio worth was about $3.7 million.
"I used to make $220k for about 11 years. Saved and invested it and retired at 48. Now I spend my money which comes from dividends on travel, cars and doing what the f— I want," he said in a separate comment on the social platform.
Let's discuss some of the top holdings of the investor.
Schwab U.S. Dividend Equity ETF
The Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) tracks the Dow Jones U.S. Dividend 100 Index and provides exposure to some of the top dividend stocks trading in the U.S., including ConocoPhillips (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/COP#NYSE">COP</a>), Chevron (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CVX#NYSE">CVX</a>), Verizon Communications (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VZ#NYSE">VZ</a>) and Bristol-Myers Squibb (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BMY#NYSE">BMY</a>), among others.
NEOS S&amp;P 500 High Income ETF
NEOS S&amp;P 500 High Income ETF (CBOE: SPYI) is a high-yield covered call ETF that pays monthly dividend income. It invests in some of the top S&amp;P 500 companies and generates extra income by selling call options on stocks, generating extra premium income for shareholders. SPYI has a dividend yield of over 12%.
See Also: Have $200K saved?<a href="https://www.benzinga.com/money/have-200k-saved-heres-how-to-turn-it-into-lasting-wealth"> Here's how to turn it into lasting wealth</a>
iShares 0-3 Month Treasury Bond ETF
iShares 0-3 Month Treasury Bond ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SGOV#NYSE">SGOV</a>) tracks the performance of U.S. Treasury bonds with maturities of 0-3 months.&nbsp;
Vanguard FTSE Developed Markets ETF
The Vanguard FTSE Developed Markets ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VEA#NYSE">VEA</a>) provides investors exposure to companies trading in developed markets outside of the U.S., including Canada, Europe and the Pacific region. VEA pays quarterly dividends.&nbsp;
Janus Henderson AAA CLO ETF
The Janus Henderson AAA CLO ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/JAAA#NYSE">JAAA</a>) invests in high-quality collateralized loan obligations and provides investors with exposure to asset classes with low risk and volatility. It yields over 6%.&nbsp;
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<li>Many are using retirement income calculators to check if they&#8217;re on pace —<a href="https://www.benzinga.com/money/how-do-i-calculate-my-retirement-income-adv"> here&#8217;s a breakdown on what&#8217;s behind this formula.</a></li>
</ul>

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SGOV

50-Year-Old Early Retiree Making $175,000 in Dividends Shares Portfolio - 'Now I Spend on Travel, Cars and Doing What I Want'

Every parent wants to give their child a head start in life, especially if they grew up without <a href="https://www.benzinga.com/personal-finance/24/03/37878498/new-fidelity-study-reveals-58-of-women-aim-for-financial-security-as-their-ultimate-goal">financial security</a> themselves.
The desire to break such a generational curse is powerful, but so is the fear of making the wrong move, since a bad <a href="https://in.benzinga.com/personal-finance/25/03/44335110/stupid-20-year-investment-plan-investor-questions-200000-dividend-strategy-is-it-stupid-to-put-in-that-much-into-schd">investment</a> could derail years of careful planning. This is exactly what a Reddit user is faced with now.
The investor, a dad of a 2-year-old, has asked for advice on building a $1 million portfolio for his son with the goal of having him live comfortably off dividend income by age 34. The poster is determined to set his son up for financial freedom, so he&#8217;s already started a &#8220;mini portfolio&#8221; with a combo of dividend-oriented ETFs and speculative stocks: Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), Astra Space (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ASTR#NASDAQ">ASTR</a>), Virgin Galactic Holdings (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPCE#NYSE">SPCE</a>), and Vornado Realty Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VNO#NYSE">VNO</a>).
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&#8220;We are looking for blueprints or instructions on proper investing for our children. How to create wealth is more important than wealth itself. We really would like to make sure he is financially responsible beforehand,&#8221; the dad wrote.
His concerns involve picking the right investments to balance growth and dividends in the next 30-plus years, avoiding costly mistakes, and ensuring his son is financially responsible. The responses to the investor&#8217;s post were a mix of encouragement and caution, with many Redditors coming up with suggestions of assets.
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<h2 class="wp-block-heading">$1 Million Portfolio for a 2-Year-Old&#8211;Reddit Advises Dad on Allocations</h2>
ETFs are Safe for the Long Run
Many commenters suggested individual stocks are too risky for a 30-year investment horizon, and recommended low-cost ETFs instead.
&#8220;Not an expert at all, but I&#8217;m thinking safe ETFs with high quality companies. Time will take care of everything. Thinking simple: SCHD, [SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>)],&#8221; a comment reads.
A Redditor suggested a mix between dividend-focused and tech assets, which provide both growth and regular payments.
&#8220;[Vanguard High Dividend Yield ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vym#NYSE">VYM</a>)], [Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>)], [Invesco QQQ Trust (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>)]. This is dividend + tech. That&#8217;s what I would bet on for 30 years. Dividend low-fee ETF + some growth inform of tech. I personally would pick stocks for the QQQ portion of the fund [(Apple (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>)] + [Microsoft Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>)] + [Alphabet (NASDAQ: GOOGL, GOOG)] + [Amazon&nbsp; (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/amzn#NASDAQ">AMZN</a>)]).&#8221;
&#8220;I remember someone showing the Top 30 or 20 companies by market cap in 1980/1990 and then the new list in 2020 and every one of them had changed/dropped off, bar 1. Might be a good argument for an ETF if you're thinking for the kid,&#8221; a Redditor advocated.
This user also advised the investor to choose ETFs instead of individual stocks because in such a long period, companies can change a lot.
&#8220;I would avoid single stocks and go with a few ETFs because you talking 16 years before they turn 18 and have that last many years, a lot can change with an individual company,&#8221; he said.
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Set Up a Trust
Several Redditors warned the poster that giving a young adult sudden wealth can backfire, so he should consider setting up a structured trust with gradual payouts.
&#8220;OP could set up a trust for their kid where a percentage is released at 18, another at 30, 100% at 50, or however he sees fit. It doesn't stop the kid from possibly becoming a d&#8211;k, but it would minimize the risk of them blowing everything before they're fully matured. He could even add in a clause that allows additional access to money at an earlier age for things such as education or buying a house,&#8221; a commenter wrote.
A Reddit user said he won&#8217;t tell his children about the money he set up for each of them until they&#8217;re 30.
&#8220;I'm not telling my kids about anything I'm putting aside for them until they're 30. Everyone I know that inherited large sums of money before 30 pissed it all up the wall,&#8221; he said.
&#8220;Be very careful what you tell him or her. There is a difference between being a wage slave but also learning the importance of hard work. Tell a kid that they got money coming mid-30s? I would have screwed around in my 20s and felt entitled to that money,&#8221; another comment reads.
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AMZN

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Dad With 'Mini Portfolio' And $1M Investment Plan Wants Son 'Living Off Of Dividend Income Comfortably' – Reddit Debates Best Stocks To Buy

Investing can feel like walking a tightrope for some, especially if they are not enjoying <a href="https://www.benzinga.com/25/03/44402198/aggressive-trader-with-nearly-1m-in-play-bets-big-on-market-drop-what-if-we-dont-get-there-reddit-debates-his-high-risk-strategy">high-risk</a> bets. For many investors, the dream is to grow their money steadily and reliably so they won&#8217;t be kept at night worrying about market crashes.
That&#8217;s why so many risk-averse investors turn to <a href="https://www.benzinga.com/markets/25/02/43897884/dividend-investor-making-5-000-per-month-with-632-000-reveals-portfolio-it-takes-time-but-its-doable">dividend</a> assets, be it stocks or ETFs. Dividend-focused holdings offer a tangible return while still providing possible growth in the long run. Still, even within this safer zone of investing, choices can be daunting.
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That is exactly what a Reddit user is faced with. The investor has done his homework, comparing two popular ETFs, Vanguard S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOO#NYSE">VOO</a>) and Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), and found that their performance is 97% correlated.
&#8220;After carefully doing a correlation function against SCHD, the results were 97% correlation (same market directions) for the last 5 years. Buying SCHD will double my quarterly income by almost 2x more than VOO. But then again, 3+ years has a higher percentage gain for VOO over SCHD. I know the underlying assets are different between these ETFs and the fee is lower in favor of VOO. What would you do?&#8221; he wrote.
He aims to generate $1,000 per month in dividend income and he's also cautious about locking the funds away in tax-deferred accounts, preferring to have control over his investments. The investor is also holding Global X NASDAQ 100 Covered Call ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QYLD#NASDAQ">QYLD</a>)​ but says it doesn&#8217;t have great growth, so he&#8217;s wondering which of the two ETFs he should go with.
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The Reddit community has shared insights and advice in the comments, so let&#8217;s analyze them.
<h2 class="wp-block-heading">VOO Vs. SCHD: Where to Invest $50,000?</h2>
Why Not Both?
Many Redditors argued that since both ETFs are highly correlated but serve slightly different purposes, splitting the investment between the two makes sense.
&#8220;Split the total investment between both and just enjoy the gains and that you aren&#8217;t putting everything into just one ETF,&#8221; a Reddit user suggested.
A commenter pointed out that investing in both ETFs will secure the poster&#8217;s portfolio because, if one ETF goes down, he has the other as backup.
&#8220;If one sector of the market does poorly, you can rely on the other for growth. If done right, both would still pay in dividends, you&#8217;ll just have good growth overall. Plus, if for whatever reason you need to liquidate the asset in the poor-performing market sector, you&#8217;ll have the backup,&#8221; he said.
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SCHD All The Way
Most commenters in the thread pushed for SCHD as the better choice, especially since the investor mentioned he's focused on generating dividend income.
&#8220;Just go with SCHD. There are YouTube videos out there that cover the long-term results of all these different funds and even compare them. SCHD blows the others away,&#8221; a user wrote.
&#8220;SCHD over VOO any day,&#8221; another suggestion reads.
A Redditor recommended the poster go with VOO if he&#8217;s looking at the total returns, but if he&#8217;s focused on dividends, he should choose SCHD.
&#8220;If the goal is total return, I&#8217;d go with VOO; if the goal is dividend income, I&#8217;d go with SCHD,&#8221; he said.
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Consider Alternative Holdings
While most comments revolved around SCHD and VOO, several Redditors mentioned alternative assets, both high-yield plays and growth-oriented holdings.
&#8220;Have you considered [AG Mortgage Investment Trust (NYSE: MITT] or QYLD? Both these stocks have double-digit dividends,&#8221; a commenter asked.
&#8220;I'd do like 30/40 in VOO or SCHD and the rest in [Vanguard Information Technology ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vgt#NYSE">VGT</a>)] or [Vanguard Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vug#NYSE">VUG</a>)],&#8221; a piece of advice reads.
A Redditor suggested selling covered calls rather than investing in VOO and SCHD.
&#8220;I am all in [Microsoft (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>)] and I have no problems with it. I sell MSFT calls monthly. You&#8217;d probably get better yield going all in on [SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>)] and writing calls there rather than splitting between VOO and SCHD,&#8221; he said.
Sharing his favorite assets to buy, this commenter highlighted the dividend income he receives from his holdings.
&#8220;I have $50,000 in QYLD. The monthly dividend is over $500 every single month. The bulk and rest of my s&#8211;t is in [​Vanguard Total Stock Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vti#NYSE">VTI</a>)]. Then, I'm buying [Realty Income Corporation (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/o#NYSE">O</a>)], [Invesco QQQ Trust (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>)], VUG, [JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)], [iShares MSCI USA Momentum Factor ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mtum#NYSE">MTUM</a>)], [Financial Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlf#NYSE">XLF</a>)], [Kinder Morgan (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/kmi#NYSE">KMI</a>)] (since it dropped so much, how could I not?), [Advanced Micro Devices (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/amd#NASDAQ">AMD</a>)], and [Apple (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>)],&#8221; he wrote.
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Reddit In Chaos As Investor With $50K Faces Huge ETF Dilemma – 'I Prefer A Nice Dividend With Overall Steady Growth,' But Is VOO The Answer?

<a href="https://in.benzinga.com/personal-finance/25/03/44376666/high-yield-dividend-investor-making-12900-per-year-names-10-favorite-stocks-took-me-almost-3-years-to-get-to-this-point">Dividend</a> investing has long been a favorite strategy for retirees and income-focused investors. Unlike growth-oriented assets, which depend on share price appreciation, dividend-paying stocks generate regular payouts.
But why do so many investors run to dividend stocks and ETFs? Dividends offer a way to compound wealth by reinvesting the generated income while also providing financial stability in <a href="https://in.benzinga.com/personal-finance/25/03/44476778/author-says-dave-ramsey-is-completely-ignorant-of-sequence-of-returns-risk-questions-whether-1-million-is-really-enough-for-retirement">retirement</a>. High-quality dividend companies also have a history of increasing payouts year after year, helping investors keep up with inflation.
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Still, total returns are also important in investing, as one investor demonstrated. The investor, a Reddit user who shared his journey in the r/Dividends community, is a 61-year-old retiree who spent 37 years building his portfolio on growth before switching to a dividend strategy when approaching retirement. He ultimately crafted a portfolio yielding around 8% and named his top holdings in the thread.
&#8220;My big break was being mostly cash in early 2020 because I felt the market had gotten too expensive. That was largely luck but it worked great. March 2020 was really fun. I spent between $1 million to $2 million on stocks in about 30 days and the resulting market rise after that secured my retirement. When I started learning about dividends, I included it as one option but still looked at it from a perspective of total returns,&#8221; he shared.
Now, he lives comfortably off dividends, rarely selling stocks for income, and relying on growing dividend payouts. The investor has shared his holdings in the Reddit community, so let&#8217;s see what they are.
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<h2 class="wp-block-heading">Retiree Living Off Dividends Shares Top 10 Holdings in Reddit Investing Community</h2>
AbbVie
AbbVie (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ABBV#NYSE">ABBV</a>) is a global biopharmaceutical company focusing on the research and development of advanced treatments for complex diseases. Investors love ABBV because of its strong product portfolio and its steady dividend history, paying approximately 3.23% annually in dividends.
Arbor Realty Trust
A real estate investment trust with a high yield, Arbor Realty Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ABR#NYSE">ABR</a>) focuses on originating and servicing loans for multifamily and commercial real estate. The company pays investors around 14.11% in dividends annually.
Broadcom
A tech dividend grower, Broadcom (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>) is known for semiconductors and software, and despite a modest yield, it raises payouts aggressively. AVGO has a 1.24% dividend yield per year.
Hercules Capital
Hercules Capital (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HTGC#NYSE">HTGC</a>) is a business development company that offers venture debt to technology and life sciences companies. Investors love HTGC since it offers high dividend yields and exposure to emerging growth companies. The company pays investors around 9.39% in dividends.
Mastercard
Mastercard (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MA#NYSE">MA</a>) is a well-known global technology company operating in the payments industry. MA pays investors approximately 0.56% in dividends yearly.
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Realty Income Corporation
A real estate investment trust, Realty Income Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/O#NYSE">O</a>) is known as &#8220;the monthly dividend company&#8221; since it pays investors every month. O owns over 6,500 properties under long-term lease agreements and has a very diversified property portfolio, paying 5.76% per year in dividends.
Target
Operating as a general merchandise retailer selling a wide assortment of products, such as household essentials, apparel, and electronics, Target (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TGT#NYSE">TGT</a>) generates approximately 4.23% in dividends.
Vanguard Total Stock Market ETF
Vanguard Total Stock Market ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTI#NYSE">VTI</a>) tracks the performance of the CRSP US Total Market Index, covering virtually all investable U.S. stocks. With a dividend of around 1.35% per year, the ETF is loved by investors because it offers broad exposure to the U.S. equity market with low expense ratios.​
Schwab U.S. Dividend Equity ETF
Tracking the performance of the Dow Jones U.S. Dividend 100 Index, Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) focuses on high-dividend-yielding U.S. stocks. SCHD generates around 3.81% in dividends.
Invesco S&amp;P SmallCap 600 Revenue ETF
Paying around 1.47% in dividends per year, Invesco S&amp;P SmallCap 600 Revenue ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RWJ#NYSE">RWJ</a>) tracks the performance of the S&amp;P SmallCap 600 Revenue-Weighted Index. Investors love RWJ because it provides exposure to small-cap U.S. companies weighted by earnings.
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Retired At 58, He 'Spent Between $1M-$2M On Stocks' – Investor Who Built An 8% Yield Portfolio And Lives Off Dividends Shares Top Holdings

Many investors find the benefits of <a href="https://www.benzinga.com/personal-finance/25/03/44461718/high-income-earner-with-3000-monthly-to-invest-faces-big-decision-i-definitely-want-to-diversify-beyond-ai-and-dividends">dividends</a>, such as money working for you and steady payouts, incredibly appealing. In fact, for many, dividends are the closest thing to <a href="https://www.benzinga.com/personal-finance/24/07/39914065/financial-freedom-or-bust-why-suze-orman-says-your-wallet-matters-more-than-your-flag">financial freedom</a>: they don&#8217;t need to sell assets, do not need to time the market, and get reliable income.
That&#8217;s why ETFs like Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) have become so popular. They offer investors a diversified blend of dividend-paying stocks, stable growth potential, and a tax-efficient income stream.
But is parking $1 million into SCHD only the best move? This is what a Redditor recently asked on the online discussion board, sparking a heated debate in the comments.
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The investor has a portfolio already in place but is contemplating how to invest an unexpected $1 million windfall. His goal is to generate passive income to cover basic expenses like taxes and insurance without risking the principal, so he&#8217;s considering going all in SCHD.
Some in the r/Dividends community agreed wholeheartedly with the poster, while others suggested different strategies. Let&#8217;s see their insights.
<h2 class="wp-block-heading">$1 Million Windfall in SCHD? Redditors Showed Mixed Feelings</h2>
SCHD Offers a Balanced Mix of Income and Growth
Many commenters agreed with the poster, saying that SCHD is a good choice and not only does it pay out dividends but it also provides capital appreciation, which makes it a great long-term hold.
&#8220;There&#8217;s nothing wrong with that hypo. Great diversification, growth, and income. All while being conservative. There are alternatives that give the same if not better options, but for a basic answer, yes, it would be fine,&#8221; a Redditor said.
&#8220;In a taxable account, living off the SCHD-qualified dividends and then supplementing that with 401(k) distributions is the way to go in my opinion,&#8221; a commenter wrote.
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One Redditor mentioned a dividend reinvestment plan into SCHD is a good strategy, especially if the poster isn&#8217;t close to retirement.
&#8220;If you are still younger and pre-retirement, and the SCHD is in a retirement account, I say [dividend reinvestment plan] and forget it until closer to retirement,&#8221; he said.
&#8220;SCHD has a relatively high turnover rate, which means that the underlying holdings of the ETF are bought and sold more frequently than the average ETF,&#8221; a Redditor advocated.
Diversify Beyond SCHD
While most comments centered around SCHD, some Redditors suggested mixing in several other stocks or ETFs for higher income and/or better risk-adjusted returns.
&#8220;I like my [JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)]/[JPMorgan Nasdaq Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepq#NYSE">JEPQ</a>)]. Yields about $110,000 on $1 million and pays monthly,&#8221; a user said.
A commenter shared that he balances SCHD with broad-market growth, ensuring he doesn&#8217;t miss out on appreciation.
&#8220;That&#8217;s my plan. Except I do 70% SCHD, 30% [Schwab U.S. Broad Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schb#NYSE">SCHB</a>)]. The SCHB is to participate in the S&amp;P 500 growth. In case my bet on SCHD isn&#8217;t as good as I hope, I can do a variation of stock sales that Bogleheads view as the answer to life.&#8221;
&#8220;My portfolio at age 50 will be about 75% SCHD, 25% [Vanguard Total Stock Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vti#NYSE">VTI</a>)],&#8221; a commenter said.
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One Redditor pointed out that the poster&#8217;s plan is his retirement plan also, but he&#8217;s balancing his portfolio with other assets as well.
&#8220;Nothing wrong with this. This is essentially my retirement plan. $2 million in [SPDR Portfolio S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/splg#NYSE">SPLG</a>)] + $2 million in SCHD + $500,000 in [Invesco QQQ Trust (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>)] = retirement,&#8221; he wrote.
Sharing a list of stocks he would invest in if he were in the poster&#8217;s situation, this Reddit investor splits them into buckets that either focus on dividends or growth.
&#8220;If you&#8217;re looking to create $38,000 from $1 million, you could also put ~$800,000 in Treasuries and $200,000 in pure-growth or dividend-growth stocks to get income and growth. Or you could do a high-low strategy that averages out to 3.8%; high for current income and low for growth. In the high bucket, you can include a combo of stocks like [Altria Group (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/mo#NYSE">MO</a>)], [Energy Transfer LP (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/et#NYSE">ET</a>)], [Realty Income Corp. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/o#NYSE">O</a>)], [Dow (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/dow#NYSE">DOW</a>)], [Verizon Communications (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vz#NYSE">VZ</a>)]. In the dividend-growth bucket, you can include names like [Broadcom (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/avgo#NASDAQ">AVGO</a>)], [Microsoft (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>)], [Apple (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>)], [Texas Instruments (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/txn#NASDAQ">TXN</a>)], and [Target (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/tgt#NYSE">TGT</a>)],&#8221; he wrote.
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SCHB

SPLG

Investor With Surprise $1M Windfall Sparks Heated Debate: 'Why Not Park It All In SCHD For Dividend Income?' – Reddit Weighs In

<a href="https://in.benzinga.com/personal-finance/25/03/44358643/burned-out-microsoft-engineer-with-1-1m-portfolio-debates-early-retirement-what-options-do-i-have-for-retirement-reddit-weighs-in">Retirement</a> planning often asks for bold moves, especially when transitioning from wealth accumulation to income generation, and for many investors, this shift is pivotal.
This transition is not always straightforward, requiring a massive shift in mindset and approach. Growth-focused investments are excellent for <a href="https://www.benzinga.com/real-estate/24/04/38167234/building-wealth-brick-by-brick-homeownership-sparks-208-000-surge-in-net-worth-over-four-years">building wealth</a> but can be volatile and unpredictable. In retirement, you need stability and predictability, which is where <a href="https://in.benzinga.com/personal-finance/25/03/44374276/reddit-explodes-over-dividend-math-how-much-would-the-annual-dividend-be-for-a-280k-investment-investors-debate-schds-future-growth">dividend</a>-paying stocks and ETFs come into play.
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One Reddit user, a 58-year-old investor with a $3 million portfolio, is making a bold move like this. He is considering reallocating $1 million to dividend-focused investments to test the waters before retiring. His goal is to generate $55,000 annually in dividends while making sure his portfolio remains steady enough to support his lifestyle in retirement.
&#8220;I have about a $3 million portfolio mostly spread between mutual funds and individual stocks but I have never focused on dividends. I am now 58 and thinking about putting 1/3 or $1 million into dividend ETFs and stocks in preparation for retirement,&#8221; the investor wrote.
His proposed allocation includes a combo of ETFs and stocks, such as Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), Realty Income Corporation (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/O#NYSE">O</a>), Ares Capital Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ARCC#NASDAQ">ARCC</a>), Utilities Select Sector SPDR Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLU#NYSE">XLU</a>), JPMorgan Equity Premium Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/JEPI#NYSE">JEPI</a>), and JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/JEPQ#NASDAQ">JEPQ</a>), aiming for a 5.5% yield.
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Still, the poster is unsure whether his allocation is optimal, especially when it comes to stocks like O and ARCC, and whether the ETFs he selected offer enough diversification and yield. The Reddit community has offered the investor plenty of advice and insights, so let&#8217;s see these.
<h2 class="wp-block-heading">$1 Million Reallocation For Retirement–Reddit Analyzes the Stock and ETF Selection</h2>
Diversify and Consider Risk Management
Many community members mentioned how important diversification in investing is, especially when it comes to a retirement portfolio, so they suggested replacing individual stocks with ETFs for risk reduction and simplification.
&#8220;I'd avoid individual stocks in a retirement account, like O and ARCC. I'd go with the ETF [Putnam BDC Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pbdc#NYSE">PBDC</a>)] for more diversification. I&#8217;d have you investing $1 million into: SCHD 27%, JEPI 11%, [Vanguard International High Dividend Yield ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vymi#NASDAQ">VYMI</a>)] 11%, JEPQ 10.5%, [NEOS Nasdaq 100 High Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqqi#NASDAQ">QQQI</a>)] 9.7%, [NEOS S&amp;P 500 High Income ETF (CBOE: SPYI)] 9.5%, PBDC 6.6%, [Arbor Realty Trust, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/abr#NYSE">ABR</a>)] 6%, [STAG Industrial, Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/stag#NYSE">STAG</a>)] 3.55%, [Reaves Utility Income Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/utg#NYSE">UTG</a>)] 3.5%, and your yield would be over 8% with $6,800 per month dividend income on average,&#8221; a comment reads.
&#8220;Switch XLU with more SCHD. I like [VICI Properties Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vici#NYSE">VICI</a>)] more than O; VICI is literally recession-proof. Also, I would get rid of JEPI for more JEPQ or SPYI,&#8221; a Redditor suggested.
A user pointed out that the investor has no global diversification, which can offer stability for a portfolio.
&#8220;You&#8217;ve got no international positions either. Legendary investors like Warren Buffett and Peter Lynch have both said that you should invest in companies that any idiot can run because sooner or later, one will. The same is true of countries,&#8221; he said.
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Think About Yield Optimization and Tax Efficiency
Commenters also focused on how the investor can maximize yield while maintaining tax efficiency, particularly since he is planning for retirement.
&#8220;I would personally put the bulk of money in high-yield funds like [iShares Preferred and Income Securities ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pff#NASDAQ">PFF</a>)] with a 6% yield, PBDC 9%, and JEPQ. ARCC is a [business development company] and they are required to pay out most of their earnings so the dividends are high for many BDCs. PBDC invests in the best BDCs they can find, including ARCC. This adds diversification. You could also have some money in [Schwab High Yield Bond ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/scyb#NYSE">SCYB</a>)], a corporate bond fund with a yield of 7%, and the rest in SCHD and XLU. I don&#8217;t see a reason to keep JEPI,&#8221; a Redditor suggested.
&#8220;We are retired early and in the process of migrating from dividend growth to dividend income in our taxable account. SPYI and [NEOS Nasdaq 100 High Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqqi#NASDAQ">QQQI</a>)] use return of capital in their distributions so they work well in taxable accounts. I also like some [closed-end funds] such as [Eaton Vance Enhanced Equity Income Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/eoi#NYSE">EOI</a>)] and [Eaton Vance Enhanced Equity Income Fund II (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/eos#NYSE">EOS</a>)] that use long-term capital gains and/or return of capital in their distributions,&#8221; a retiree in the comments recommended.
A Redditor considered the poster&#8217;s strategy way too conservative and advised him to go more aggressive to boost income and overall returns.
&#8220;In my opinion, you are short-changing yourself with such a conservative dividend income portfolio. I hold JEPQ and other high dividend funds and ETFs and am getting a yield of 12%+ with 26% total return in 2024,&#8221; he said.
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PBDC

iShares S&P US Preferred Stock Index Fund

QQQI

SCYB

STAG

VYMI

58-Year-Old With $3M Portfolio Makes Bold Retirement Move – 'I Want To Test It Out Before I Actually Retire' With $1M In Dividend Stocks

Diversification is the foundation of sound <a href="https://in.benzinga.com/personal-finance/25/03/44438885/charlie-munger-told-a-20-year-old-that-getting-rich-through-investing-is-damn-near-impossible-and-you-might-need-10-million-in-the-bank">investing</a>, often described as the only &#8220;free launch&#8221; in finance. By spreading investments across various assets and sectors, investors can mitigate risk and grow their money at the same time.
Enter the world of ETFs, which are a great way to achieve <a href="https://in.benzinga.com/25/03/44379640/looking-beyond-big-tech-where-to-find-diversification-without-sacrificing-growth">diversification</a>. Broad-market ETFs like Vanguard S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOO#NYSE">VOO</a>) and Vanguard Total Stock Market ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTI#NYSE">VTI</a>)​ offer exposure to a wide range of companies, while sector-specific or dividend-oriented ETFs like Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) provide more targeted strategies. The key is to align investments with long-term goals, tax considerations, and risk tolerance.
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In a recent Reddit post, a high-income earner shared his financial circumstance and sought advice on how to invest a considerable amount of money. The poster has maxed out his tax-advantaged accounts, holds $75,000 in VOO, and now has an additional $150,000 to put into the market, along with the ability to contribute $3,000 or more per month. His goal is to retire in 20 years, so he wants to diversify beyond his current holdings.
&#8220;I definitely want to diversify. I think the AI/Mag7 are due for a correction. I want to have some [ex-U.S.] investments as well. We can invest $3,000+ each month, so we&#8217;re slow and steady, not trying to moonshot anything. But ~20 years is when we want to retire (quite a lot younger than average),&#8221; he wrote.
The investor&#8217;s main question was how to allocate his windfall and what monthly contributions he and his wife should make to achieve long-term growth while keeping risks low and avoiding unnecessary taxes. The Reddit community has shared insights and suggestions in the comments, so let&#8217;s analyze them.
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<h2 class="wp-block-heading">Where Should the Investor Allocate $150,000 and $3,000/Monthly? Redditors Share Insights</h2>
Stick with Broad-Market ETFs for Long-Term Growth
Many users suggested doubling down on broad-market ETFs like VOO, pointing out their simplicity, diversification, and historical performance.
&#8220;20 years? Yeah, dude, I'm a certified SCHD cult member and I would still go 100% VOO,&#8221; a Redditor said.
&#8220;This is the only answer. More VOO,&#8221; a comment reads.
A Reddit user mentioned that while SCHD is his favorite ETF, he recommends VOO because he&#8217;s certain it will surpass SCHD in the long run.
&#8220;I mean, SCHD is my favorite ETF, but my opinion is that VOO will outperform it over a 20-year period, and with far fewer tax implications. You obviously can just buy dividend-paying funds at or near retirement, especially if you prefer dividends and not selling stocks over the usual 4% rule,&#8221; he said.
A commenter also recommended the poster invest in VOO because broader diversification might complicate the whole investing journey.
&#8220;$150,000 of VOO. Don&#8217;t overcomplicate it,&#8221; he wrote.
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Add International Exposure and Alternative Assets
Several community members advised the poster to diversify beyond the U.S. market by adding international ETFs or alternative assets to his portfolio.
&#8220;Here&#8217;s what I&#8217;d do: put 63% in VTI, put 27% in [Vanguard Total International Stock ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vxus#NASDAQ">VXUS</a>), put 7% in [WisdomTree Floating Rate Treasury Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/usfr#NYSE">USFR</a>)], put 3% in Bitcoin,&#8221; a Redditor suggested.
&#8220;If I'm managing someone else's money for 30 years, I'm probably doing something like: 60% VTI, 10% [Berkshire Hathaway Inc. Class B (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/brk-b#NYSE">BRK-B</a>)], 30% VXUS,&#8221; a comment reads.
A Redditor recommended allocating a portion of the portfolio to VXUS and BRK.B to diversify while minimizing risks.
&#8220;If you're looking at diversifying from what you have, you can add some VXUS (underperformed for decades but that might be changing?). BRK.B is basically a value ETF. You already hold a decent amount of it in VOO, but nothing wrong with adding a bit more Berkshire,&#8221; he wrote.
&#8220;BRK.B has been beating [SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>)],&#8221; another comment says.
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BRK-B

USFR

VXUS

High-Income Earner With $3,000+ Monthly To Invest Faces Big Decision – 'I Definitely Want To Diversify' Beyond AI And Dividends

Investors are often driven by the pursuit of massive <a href="https://in.benzinga.com/analyst-ratings/analyst-color/25/03/44378283/ralph-laurens-prospects-of-market-share-gains-margin-expansion-turns-this-analyst-bullish">gains</a> and few assets capture this ambition better than individual stocks–like Nvidia Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>)–that have seen a meteoric climb.
For many, high returns from individual <a href="https://www.benzinga.com/markets/25/03/44239013/retirement-investor-with-21-600year-in-dividends-needs-2-200-more-per-month-what-high-yield-stocks-w">stocks</a> and/or options trading are irresistible because such investments can turn a modest sum of money into life-changing <a href="https://www.benzinga.com/markets/25/02/43801235/paper-mill-worker-builds-1-7-million-fortune-through-investing-top-3-stocks-that-boosted-his-wealth">wealth</a>.
This is the case of a 32-year-old ex-military who made $700,000 in options trading but is unsure of what to do next. After hitting it big, the investor is wondering whether he should double down on high-risk strategies, or pivot to more stable, long-term investments, so he&#8217;s taken to Reddit to seek advice.
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With 4,200 shares of NVDA at a cost basis of $69 and $350,000 in cash, he is at a crossroads. His end goal is to preserve and grow his wealth while minimizing risk because he thinks his options trading run may be coming to an end. Still, he isn&#8217;t sure about what to do next.
&#8220;I was in the military but I started trading options and just did that for a few years. I think my run is at the end, though. Finishing school and getting a job now in the next year. I've been waiting for a pullback, unsure when to hop in. Kinda just wanna be done with it,&#8221; he wrote.
He asked whether he should put all his money in Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), which is known for its focus on high-quality dividend-oriented stocks. The community offered plenty of suggestions so let&#8217;s analyze the comments and distill the most relevant advice below.
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<h2 class="wp-block-heading">$350,000 in SCHD? Reddit Assesses His Plan and Gives Suggestions</h2>
Avoid Putting All Your Money in One Asset
One of the most prevalent advice in the comments was to avoid putting all the money into a single investment–SCHD in this case–and diversify the portfolio into several assets.
&#8220;At age 32, I think you should consider a mix of SCHD, [Schwab U.S. Large-Cap Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schg#NYSE">SCHG</a>)], and perhaps [Schwab International Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schf#NYSE">SCHF</a>)]. Perhaps 45/45/10 or 50/45/5,&#8221; a Redditor advised.
A commenter suggested the investor a mix of growth and dividend-paying investments, as well as international exposure.
&#8220;Personally though, I&#8217;d put $50,000 to $100,000 into ex-U.S. markets. [Vanguard International High Dividend Yield ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vymi#NASDAQ">VYMI</a>)], [Legg Mason International Low Volatility High Dividend ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/lvhi#NASDAQ">LVHI</a>)], [Franklin International Core Dividend Tilt Index ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/divi#NYSE">DIVI</a>)] are a few dividend-focused options,&#8221; he said.
Recommending a mix of individual stocks, ETFs, and dividend-paying assets, this Reddit user provided a detailed illustration of how diversification can be achieved in a portfolio.
&#8220;$50,000 [Vanguard S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voo#NYSE">VOO</a>)], $50,000 growth stocks like [Apple Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/aapl#NASDAQ">AAPL</a>)], NVDA, and others, $50,000 SCHD, $50,000 [JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/jepq#NASDAQ">JEPQ</a>)], $50,000 [JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)], $50,000 [Simplify Volatility Premium ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/svol#NYSE">SVOL</a>)], $50,000 ([Pfizer Inc. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pfe#NYSE">PFE</a>)], and other dividend stocks),&#8221; his suggestion reads.
&#8220;At 30, SCHG 50% VOO 50%,&#8221; another comment says.
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Consider Tax Efficiency and Long-Term Growth
Another recurring theme in the thread was the importance of tax efficiency and the possible drawbacks of focusing only on dividend income, with many Redditors suggesting that dividend-paying ETFs might not be the best option when it comes to taxes.
&#8220;Dumping $350,000 in there is a monumentally terrible idea. SCHD underperforms the S&amp;P 500 with dividends reinvested and not even counting the extra tax drag. You&#8217;d be creating more taxable income for yourself which is a terrible strategy. You want to minimize income and maximize net worth. Dumping all of your capital into something paying income is the opposite of what you should be doing,&#8221; a Reddit user wrote.
A Redditor suggested to the investor several other options that he says would yield more returns than SCHD.
&#8220;SCHD is a good fund, but is it best for you? With $350,000 invested, it will produce about $12,000 a year. Instead, $350,000 invested in [iShares Preferred and Income Securities ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pff#NASDAQ">PFF</a>)] with a 6% yield, would earn you about $21,000 a year. Or you could invest in [business development companies] using [Putnam BDC Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pbdc#NYSE">PBDC</a>)] and earn $31,000. Or [NEOS Nasdaq-100 High Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqqi#NASDAQ">QQQI</a>)] with a 23% yield and earn $45,000,&#8221; the commenter said.
&#8220;SCHD 30%, VOO 20%, [Realty Income Corporation (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/o#NYSE">O</a>)] 14%, [PepsiCo Inc. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pep#NASDAQ">PEP</a>)] 14%, [Enterprise Products Partners L.P. (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/epd#NYSE">EPD</a>)] 12%, [Ares Capital Corporation (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/arcc#NASDAQ">ARCC</a>)] 10%,&#8221; a user recommended.
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</ul>

DIVI

LVHI

SCHF

SCHG

SVOL

32-Year-Old Investor With Massive NVDA Gains And $350K Cash Asks Reddit: 'What's Stopping Me From Putting It All In SCHD?'

Investing in <a href="https://www.benzinga.com/personal-finance/25/03/44376666/high-yield-dividend-investor-making-12900-per-year-names-10-favorite-stocks-took-me-almost-3-years-to-get-to-this-point">stocks</a> and funds is one of the most powerful ways to build <a href="https://www.benzinga.com/personal-finance/25/01/42773692/i-dont-want-you-to-invest-like-im-young-mark-cuban-reveals-how-he-protected-his-wealth-after-selling-his-first-company">wealth</a> over time, but choosing the right assets and strategy can be overwhelming, especially if you&#8217;re dealing with a large sum of money.
While some investors prefer high-risk, high-reward plays, others swear by the reliability of long-term holding. Besides individual stocks, ETFs have become a popular option for investors looking for long-term stability, thanks to their diversification, low costs, and ease of access.
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With $250,000 to invest and confused about which assets to buy, one Reddit user turned to the online discussion board to seek advice. The Redditor has no immediate need of that money, no wife, no kids, and a full-time job that leaves him with little time to dive deep into investment research.
His main goal is to maximize the returns in five to seven years but he&#8217;s unsure about the best approach to deploy his funds.
&#8220;I&#8217;ve also spoken with a few financial advisors and just wanted to get varying points of view. I don&#8217;t need this cash for 5-7 years. So maximum return on that timeframe I suppose?&#8221; he wrote.
The poster has mentioned a preliminary plan, which includes monthly investments into individual stocks and ETFs, such as NVIDIA Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>), Microsoft Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>), Alphabet Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOGL#NASDAQ">GOOGL</a>, GOOG)), Vanguard S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOO#NYSE">VOO</a>), Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), and even cryptocurrencies like Bitcoin and Ethereum.
He&#8217;s also considering dollar-cost averaging around $12,000 monthly over the next 12 months, but isn&#8217;t sure about the best investment interval and whether his current allocation is too broad or too concentrated.
Trending: It&#8217;s no wonder Jeff Bezos holds over $250 million in art — <a href="https://www.benzinga.com/money/masterworks">this alternative asset has outpaced the S&amp;P 500 since 1995, delivering an average annual return of 11.4%. Here&#8217;s how everyday investors are getting started.</a>
Reddit has offered plenty of suggestions in the comments, so let&#8217;s dive into those.
<h2 class="wp-block-heading">No Wife, No Kids, $250,000 to Invest and Little Time to Study Investing – Reddit Advises the Poster</h2>
Lump Sum Vs. Dollar-Cost Averaging
The thread has seen a debate between some users recommending investing the whole sum and those suggesting dollar-cost averaging. Some even suggested a hybrid approach.
&#8220;You can put half in now and then the rest over 6-12 months. A good compromise between lump sum and dollar-cost averaging,&#8221; a comment says.
A commenter mentioned the fact that he asked the same question about dollar-cost averaging vs. lump sum in another community on Reddit, and users have suggested he invests all the money at once.
&#8220;I asked this very question in the investing sub a week ago. Decided to hold off and, oh boy, am I glad I did. I&#8217;ll probably wait another week and reassess. By the way, in the other thread, people were posting stats about how you&#8217;re better off just putting everything in at once over [dollar-cost averaging]. A two in three chances you&#8217;ll be better off,&#8221; he said.
On the other hand, this Redditor advised the poster to ignore those suggesting him to go all in.
&#8220;Please. Ignore the lump sum advocates. Historically, it works out well 66% of the time. But that might not be in this time of unprecedented government incompetence and maliciousness,&#8221; the user wrote.
&#8220;[Dollar-cost averaging] is perfectly acceptable and "not timing the market" is not 100% foolproof. If Joseph Kennedy took your advice in 1929, there would be no Kennedy fortune, but because he was inspired to sell right before the crash, they preserved their wealth,&#8221; another comment reads.
See Also: Have $200K saved?<a href="https://www.benzinga.com/money/have-200k-saved-heres-how-to-turn-it-into-lasting-wealth"> Here's how to turn it into lasting wealth</a>
Balance Your Portfolio
The poster&#8217;s initial plan included allocations to a mix of ETFs, individual stocks, and cryptocurrency, and Redditors had diverse opinions on whether this type of diversification is a good approach.
&#8220;If I were entering the market now, I would go for a balanced exposure with some bonds in the mix (60/40 or 70/30 if you can really stomach the risk over 5 years), and avoid any single market concentration. The bond component of your portfolio would not be there to raise any potential returns (it likely won&#8217;t) but rather to minimize volatility over the 5-7 year period you indicated,&#8221; a commenter suggested.
&#8220;Don't put it all in VOO. Diversify,&#8221; another Redditor advised.
A comment pointed out that diversification should expand beyond equities and should include assets that offer a broader market exposure.
&#8220;Diversification should go beyond equities. Consider some other asset types to give you broader exposure. You can also weigh your contributions, they can vary based on metrics of your choosing,&#8221; the comment says.
&#8220;All in on stocks during the start of a trade war/recession/depression is moronic. [SPDR Gold Shares (NYSE: GLD] and Bitcoin/[iShares Bitcoin Trust ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/ibit#NYSE">IBIT</a>)] are your friends for diversifying,&#8221; another diversification suggestion reads.
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<li>How do billionaires pay less in income tax than you?<a href="https://www.benzinga.com/money/tax-deferring-adv"> Tax deferring is their number one strategy</a>.</li>
</ul>

No Wife, No Kids, $250K To Invest—'I Don't Need This Cash For 5-7 Years'—Reddit Battles Over The Best Long-Term Stock And ETF Strategy

In today&#8217;s fast-paced world, many want to build wealth and achieve long-term financial <a href="https://in.benzinga.com/personal-finance/25/03/44146342/charlie-munger-said-he-was-passionate-about-getting-rich-but-not-because-i-wanted-ferraris-i-wanted-the-independence">independence</a>. Countless people dream of financially securing their future, and for many, that path is through investments in the stock market.
Yet, the path to financial independence is rarely straightforward, especially for those starting to invest later in life and have little to no knowledge of the <a href="https://in.benzinga.com/personal-finance/25/03/44287485/peter-lynch-said-theres-always-something-to-worry-about-but-success-in-the-stock-market-depends-on-your-stomach-not-the-brain">stock market</a>, as is the case of one Reddit user.
The individual, a 38-year-old, shared his concerns in a Reddit community of investors. He said that he recently came across a substantial amount of money–$750,000 in cash–but has no other assets such as a house, no pension, and no investments.
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The poster is focused on long-term growth and is seeking advice on how to invest his newly acquired money wisely. He is also cautious about the current market volatility and is wondering whether he should wait a few weeks before he starts investing, whether to go for a dollar-cost average approach and if other options beyond ETFs would suit his goals.
&#8220;I&#8217;m 38 years old with newly acquired $750,000 in cash. How should I invest? My goal is long-term growth. Should I wait a few more weeks? When [dollar-cost averaging]–what amounts and frequency should I shoot for? And advice for investments beyond ETFs given the volatility at the moment?&#8221; he asked.
Trending: Can you guess how many retire with a $5,000,000 nest egg? <a href="https://www.benzinga.com/money/5mil-nest-egg-adv">The percentage may shock you</a>.
The Reddit community has responded to the 38-year-old&#8217;s post with insights and advice, so let&#8217;s dive deeper into the comments to find out what the community has suggested.
<h2 class="wp-block-heading">How to Invest $750,000? Reddit Community Shares Insights</h2>
Use Dollar-Cost Averaging and Invest in ETFs
One of the most common suggestions was to use dollar-cost averaging to invest in ETFs, especially those tracking global and U.S. markets.
&#8220;Definitely [dollar-cost averaging] over a year or two. You should buy world ETFs, U.S. ETFs, and 20% bonds,&#8221; a comment says.
One Redditor suggested specific ETFs he thinks would grow the poster&#8217;s money in the long run.
&#8220;[Vanguard S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voo#NYSE">VOO</a>)] or [Vanguard S&amp;P 500 Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voog#NYSE">VOOG</a>)], [Vanguard Information Technology ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vgt#NYSE">VGT</a>)] or [Technology Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlk#NYSE">XLK</a>)], [Vanguard Total World Stock ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vt#NYSE">VT</a>)] or [Vanguard Total International Stock ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vxus#NASDAQ">VXUS</a>)],&#8221; he said.
A commenter pointed out he has a more structured approach to dollar-cost averaging with a focus on a few particular ETFs.
&#8220;Looking forward to the responses as I'm currently sitting in [iShares 0-3 Month Treasury Bond ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sgov#NYSE">SGOV</a>)]. My plan is to ladder into [iShares Bitcoin Trust ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/ibit#NYSE">IBIT</a>)], VT, and VOO. I will do bi-weekly buys starting in June,&#8221; he wrote.
A Reddit user suggested a mix of global equity exposure and bonds for a diversified portfolio.
&#8220;VT 70%, [Vanguard Total Bond Market ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/bnd#NASDAQ">BND</a>)] 30%. Increase BND 10% for each 10 years of your age from now on. Good luck to you,&#8221; the user said.
&#8220;VT, [Schwab US Dividend Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schd#NYSE">SCHD</a>)], [iShares Core Dividend Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/dgro#NYSE">DGRO</a>)], [Invesco NASDAQ 100 ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqqm#NASDAQ">QQQM</a>)], [JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: JEPQ]. SGOV or [Vanguard Treasury Money Market Fund (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vusxx#NASDAQ">VUSXX</a>)] for other opportunities,&#8221; a comment reads.
One user mentioned a global stock market ETF but agreed that VXUS is also a good choice.
&#8220;I like [SPDR Portfolio MSCI Global Stock Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spgm#NYSE">SPGM</a>)], but VXUS is good as well,&#8221; a comment reads.
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Don&#8217;t Time the Market
Many Redditors cautioned against market timing, with some even predicting what they think the new investor will do after investing.
&#8220;Imagine hoarding $750,000 during a 15-year bull market, to only now considering investing it. The market is guaranteed to drop 20% starting the day after the OP invests it. And someone new to investing will get emotional about the 20% drop and sell at the bottom, where it will immediately go on a 5-year bull run again,&#8221; a commenter wrote.
&#8220;Man, you got $750,000 and you didn't put a cent of that into the S&amp;P 500 over the last 5 years. I can see the S&amp;P 500 being very choppy over the next four years with Trump. If I were honestly you, I would keep that money in a savings bank account. And invest new money from my wages into the S&amp;P 500, bonds ETF, and income ETFs,&#8221; another comment says.
Replying to the above user, a Redditor reminded him that the poster didn&#8217;t have the money for long.
&#8220;Sounds like he just came into the $750,000 recently,&#8221; he said.
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</ul>

DGRO

QQQM

SPGM

VOOG

VUSXX

$750K In Cash But No Assets Or Pension – 38-Year-Old Asks: 'My Goal Is Long-Term Growth. How Should I Invest?' Reddit Is Divided

For many investors, the goal of achieving financial independence or building <a href="https://www.benzinga.com/personal-finance/24/10/41258919/dave-ramsey-tells-mark-cuban-75-of-the-worlds-richest-say-do-this-to-build-wealth-listen-to-them">wealth</a> in the long run focuses around strategies like dividend reinvestment plans and <a href="https://www.benzinga.com/markets/25/03/44196217/53-year-old-with-200k-to-invest-seeks-best-stocks-for-retirement-should-i-go-all-in-on-etfs-or-bet-b">ETFs</a>.
DRIPs make it possible for investors to automatically reinvest dividends into additional shares, compounding returns in time. ETFs, on the other hand, offer an accessible way to diversify across securities, reducing risk while riding on the market growth.
But how much diversification is enough, and can a single ETF provide the growth and security needed for a 40-year investment time frame? That is a question one Reddit user struggles with.
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</ul>
The user, a 31-year-old sewer builder with $40,000 in an IRA and $40,000 in a Roth IRA, is considering a long-term DRIP approach using just one ETF, Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), which holds 101 securities. His target is to maximize returns over the next 30 to 40 years, but he's skeptical about this approach providing enough diversification.
&#8220;I&#8217;d DRIP for 30-40 years (retirement ages are likely going to increase, unfortunately!) And add max out the Roth for as long as I can. Is this a bad decision? Is one ETF with 101 securities insufficient diversification?&#8221; he asked Reddit.
Reddit has offered the investor plenty of advice in the comments; let&#8217;s analyze them below.
<h2 class="wp-block-heading">$80,000 All In SCHD? Reddit Investors Offer Their Suggestions</h2>
Go for Growth Instead of Dividends in the First Few Years
Commenters emphasized that, at 31 years old, the investor should focus solely on growth-oriented investments rather than dividend-focused ones like SCHD.
&#8220;Dividends have their place, for sure. I personally would not do that! That amount of money I would put into growth only like the S&amp;P 500! Why? You will make more money in the long run through growth. You can then at retirement either sell the growth and buy dividends, which will make you a lot more money. Just have to maneuver how much to sell at a time for tax purposes. Or&#8230; just take a 4% payout, and it will be even more money payout,&#8221; a Redditor said.
Trending: Many are using retirement income calculators to check if they&#8217;re on pace —<a href="https://www.benzinga.com/money/how-do-i-calculate-my-retirement-income-adv"> here&#8217;s a breakdown on what&#8217;s behind this formula.</a>
Replying to the poster&#8217;s question, &#8220;Is this a bad decision?&#8221; a commenter said, &#8220;Yes. It would likely reduce your gains over 30 or 40 years by hundreds of thousands of dollars vs. investing in the S&amp;P 500. I ran the numbers with someone who had the same bad idea yesterday here.&#8221;
A Redditor suggested a hybrid approach, with most of the portfolio allocated to growth ETFs and a smaller portion to dividend assets.
&#8220;With 30 or 40 years, I&#8217;d go all in on growth. [Invesco QQQ Trust (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>)] or similar, or 80/20 with the 20% being SCHD or similar. Dividends are nice when you need them. You don&#8217;t need them because of your time horizon.&#8221;
&#8220;Nah, as good as SCHD is, the fact is, you would be missing out on some very good growth by not owning tech and growth funds,&#8221; another comment reads.
A user recommended the poster split the portfolio between three different ETFs to mix in both growth and dividends.
&#8220;It&#8217;s not the number of securities that makes it somewhat insufficient, it&#8217;s the type of securities. You&#8217;re too young to be all in SCHD. Split it evenly three ways with [SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>)], QQQ, and SCHD,&#8221; he said.
See Also: If there was a new fund backed by Jeff Bezos offering a <a href="https://www.benzinga.com/money/arrived-private-credit-fund">7-9% target yield with monthly dividends would you invest in it</a>?
Never Go All In Into One Asset
Many Redditors disagreed with the idea of going all in into an asset, and instead, suggested diversification as a solution.
&#8220;Not everyone needs to beat the market. Wealth preservation is good and SCHD will give you a nice retirement from dividends. Don't put all your eggs in one basket,&#8221; a Redditor wrote.
&#8220;Never go all in on one thing; go a little of this, a little of that, diversity your portfolio!&#8221; one comment says.
Besides advising the poster to avoid investing all his money in only one asset, this commenter suggested a different ETF and came up with a strategy.
&#8220;Putting all your eggs in one basket is very risky, I don't care how stable the fund is. Also, if you want to constantly be paying the taxes on the income being paid every year then great, have at it. But if you ask me, you'd be better off with your time horizon and you insist on going hands-off and putting it all into one ETF, put it all into [Vanguard Total Stock Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vti#NYSE">VTI</a>)] and let it ride, DRIP, and keep adding to the position with any extra income. Let that nest egg grow 20 plus years, then move that much larger nest egg into SCHD later. That'll give you more income in your retirement,&#8221; he wrote.
&#8220;I wouldn't go all in. But make it a part of the portfolio that you consistently add to,&#8221; another commenter said.
Read Next:
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<li>Can you guess how many Americans successfully retire with $1,000,000 saved?<a href="https://www.benzinga.com/money/1milsaved"> The percentage may shock you</a>.</li>
<li>It&#8217;s no wonder Jeff Bezos holds over $250 million in art — <a href="https://www.benzinga.com/money/masterworks">this alternative asset has outpaced the S&amp;P 500 since 1995, delivering an average annual return of 11.4%. Here&#8217;s how everyday investors are getting started.</a></li>
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Investor With $40K IRA and $40K Roth IRA Eyes 40-Year DRIP Strategy – 'Is One ETF With 101 Securities Insufficient Diversification?'

For many people, the idea of passive income is beyond charming, and it is what drives countless individuals to explore different <a href="https://in.benzinga.com/personal-finance/25/03/44335110/stupid-20-year-investment-plan-investor-questions-200000-dividend-strategy-is-it-stupid-to-put-in-that-much-into-schd">investment</a> approaches.
Still, one of the most common challenges investors face, especially those at the beginning of their journey, is whether to prioritize growth assets or <a href="https://in.benzinga.com/markets/25/03/44196217/53-year-old-with-200k-to-invest-seeks-best-stocks-for-retirement-should-i-go-all-in-on-etfs-or-bet-b">dividend</a> investing. Both methods have their benefits, but choosing the right course can be difficult, especially when balancing short-term financial needs with long-term <a href="https://www.benzinga.com/personal-finance/24/12/42301100/most-americans-dont-see-wealth-as-the-key-to-financial-success-heres-what-matters-more-to-59-of-them">wealth</a> expansion.
Let&#8217;s dive into the story of a 33-year-old investor with a $40,000 portfolio who is faced with this very challenge. The Reddit user has $30,000 of the total amount invested in dividend-focused assets, generating approximately $190 per month in passive income after taxes.
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</ul>
His goal is to build a portfolio that will earn him enough dividends that he can live off them and to achieve this, he plans on investing 80% to 100% of his active income into dividend shares, ETFs, and funds.
&#8220;For now, I&#8217;m thinking maybe investing up to 20% of my portfolio to &#8220;growth&#8221; like [ProShares UltraPro QQQ (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tqqq#NASDAQ">TQQQ</a>)] and [ProShares UltraPro S&amp;P 500 (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/upro#NYSE">UPRO</a>)], only on big corrections, and 80% of my portfolio continue to hold/reinvest in dividend assets. Or maybe focus only on growth, sell all dividend assets, and invest 80% now only in Index ETFs ([SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>)], [Invesco QQQ Trust (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>)]) and 20% in leverage ETFs&#8230; There is a psychological aspect too, when I see passive income every month–it&#8217;s very motivating to continue investing more, to grow dividend income. So, dilemma&#8230; What do you think?&#8221; the young investor wrote.
Trending: The secret weapon in billionaire investor portfolios that you almost certainly don't own yet. <a href="https://www.benzinga.com/money/masterworks">See which asset class has outpaced the S&amp;P 500 (1995-2024) – and with near-zero correlation.</a>
The Reddit community took the comments by storm, sharing advice, insights, and suggestions, so let&#8217;s dive deep into these.
<h2 class="wp-block-heading">Invest $40,000 in Growth-Focused Assets or Dividends? Reddit Responds</h2>
Prioritize Growth Assets Now, Transition to Dividends Later
Many Reddit users advised the poster to focus on growth while he&#8217;s young as this strategy typically yields higher returns over the long run.
&#8220;If you&#8217;re young, I&#8217;d stick the money in a growth fund and let it ride. If you love dividends you can drop or reinvest the dividends into growth. There&#8217;s no wrong answer&#8230; but if you&#8217;re young, you&#8217;ll end up with more money investing in &#8220;growth&#8221; now. I&#8217;m 57 and started building my dividend portfolio about 15 years ago&#8230; I live on them now,&#8221; a Redditor said.
One commenter suggested a phased approach and mentioned several funds he advised the poster to invest in.
&#8220;When younger, just try and match the market. Meaning, just buy [Vanguard S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voo#NYSE">VOO</a>)] or [Vanguard Total Stock Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vti#NYSE">VTI</a>)]. Averaging 10% annually, or whatever the market is doing for 30 years, is guaranteed millionaire-making based on history. If you get crazy, follow Professor G's 3-fund approach and add in [Invesco QQQ Trust (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqq#NASDAQ">QQQ</a>)] and [Schwab U.S. Dividend Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schd#NYSE">SCHD</a>)]. SCHD will be your doorway to dividends. Then, as you start nearing retirement, start pivoting more of your portfolio to high-quality income and dividend stuff. For me, that was [JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)], [JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/jepq#NASDAQ">JEPQ</a>)], [iShares Preferred &amp; Income Securities ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/pff#NASDAQ">PFF</a>)], and about 15 other income investments and stocks,&#8221; his comment reads.
&#8220;Obviously, wealth building should be your first goal. You could use value stocks or bonds that pay dividends for diversification, but diversification doesn&#8217;t speed up wealth building, it just softens market drawdowns (and restricts bull markets),&#8221; another Redditor suggested.
A user also recommended the investor focus on growth first and later transition to dividend-paying assets.
&#8220;Focus on growth assets first, build a larger capital base, and transition into dividend investing later. In my opinion. This is my plan. Dividends are great until you have to start eating into the balance to pay large expenses,&#8221; he said.
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Psychological Motivation Vs. Financial Logic
Commenters also admitted the psychological benefits of dividend investing the poster mentioned, especially the motivation that comes from seeing regular income, but they also warned against letting feelings override a good financial plan.
&#8220;Many people spend their whole lives chasing an imaginary number. First, define for yourself what &#8220;enough&#8221; is and keep doing what you&#8217;re doing, you&#8217;re probably better off than you realize. Also, the &#8220;fastest&#8221; way is very rarely the most &#8220;logical&#8221; way, but the biggest thing you can do after cutting back spending is increase your income,&#8221; a commenter said.
A user cautioned against investing in too many assets and ending up having too many tickers to handle, suggesting a few ETFs instead.
&#8220;One thing I would caution against though, regardless of which way you go, is having too many tickers and positions to monitor. Once you get into individual stocks, managing more than 15-20 becomes basically a full-time job; at least to do it properly. So my personal recommendation would be to move into a few ETFs that align with your investment thesis unless you feel you can manage that many individual positions,&#8221; the Redditor advised.
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TQQQ

UPRO

Investor With $40,000 Portfolio Wonders If He Should Pick Dividend Investing Or Growth First – 'Would You Prioritize Dividends Or Growth?

Investing in the <a href="https://in.benzinga.com/personal-finance/25/03/44287485/peter-lynch-said-theres-always-something-to-worry-about-but-success-in-the-stock-market-depends-on-your-stomach-not-the-brain">stock market</a> is one of the most effective ways to build wealth in the long term. Among the various investment approaches, <a href="https://in.benzinga.com/markets/25/03/44065450/48-year-old-with-1-million-wants-dividend-income-to-retire-early-should-i-bet-big-on-mstys-2share-pa">dividend</a> investing has gained popularity, especially for those looking to generate passive income while still growing their portfolios.&nbsp;
One of the most talked-about dividend-paying investments is the Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), known for its focus on high-quality U.S. companies that pay dividends.
Recently, a Reddit poster has sparked a heated debate about SCHD&#8217;s future dividend growth, with investors commenting on the math and the ETF&#8217;s potential performance over the next decade.
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The poster, with $280,000 available, is a newbie in the world of dividend investing and is trying to understand how much annual dividend revenue he could expect from SCHD over the next ten years, assuming a consistent dividend growth rate. The investor&#8217;s main goal is to generate passive income; still, he is worrying about the accuracy of his calculations and the possibility of the fund maintaining a high dividend growth rate.
&#8220;If SCHD dividend yield is 3.7% and the ETF is priced at $28, then it puts the annual dividend at slightly over $1. If the dividend increases by 10% annually how much would the annual dividend be in ten years if the stock remained at the same $28 price?&#8221; the poster asked.
To answer this, the Redditor used ChatGPT to calculate future dividends based on a 10% annual growth rate, with the calculations showing that it will grow from $1.04 to $2.45 over the next decade. For a $280,000 investment, this would mean an annual dividend revenue of $24,500 by the tenth year.
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Still, the poster isn&#8217;t sure if the calculations are reliable and realistic or if there are other factors to consider, so he sought insights on a Reddit investing community. The commenters shared their advice and thoughts with the investor, so let&#8217;s dive into those.
<h2 class="wp-block-heading">How Much Would The Annual Dividend Be For a $280,000 Investment? Reddit Debates</h2>
Reassess Your Expectations
Many Redditors pointed out the investor&#8217;s expectations are way too high, urging him to reassess his hopes. While his calculations assume a 10% annual dividend growth rate, several users emphasized that this might be overly optimistic, especially in the long run.
&#8220;If you assume conservatively: $10,000 shares at $28,5% growth, 5% dividend increase, and dividends reinvested quarterly, you end up with a $674,000 portfolio and $18,000 dividend payout. This is probably a more realistic scenario and outcome,&#8221; a Redditor said.
One user replied to the above comment suggesting that it&#8217;s best to expect lower growth rates to avoid disappointment.
&#8220;That&#8217;s a very conservative dividend growth rate, less than half of 11% of SCHD&#8217;s growth rate since inception. It&#8217;s even lower than the historical dividend growth rate for all companies of 6%. I think 5% share growth is likely though. Either way, it&#8217;s a good calculation and I think it&#8217;s a good &#8220;floor&#8221; calculation,&#8221; he wrote.
A Redditor pointed out that the 10% growth rate is wildly optimistic and suggested the poster considers the risk of depending on historical performance alone.
&#8220;This seems like a fun exercise, but past performance is not an indication nor guarantee of future performance. It seems like the exercise has ideal conditions too, and there&#8217;s no guarantee of that either. A 10% yearly growth in dividends is wildly optimistic. I added more below, but 10% yearly dividend growth over the next ten years would be something. Don&#8217;t think it will, but happy to be wrong,&#8221; he said.
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Market Conditions Can Affect SCHD Strategy
Several users discussed how broader market conditions and SCHD&#8217;s investment approach can affect its expected dividend growth. They also suggested the poster consider the share price appreciation alongside the dividend growth rate.
&#8220;A share of SCHD bought at $29.22 in January of 2013 would have paid $0.90 in that year. That same share would have paid $2.66 in 2023. That would be an increase of 195% in ten years. If you're looking for a source of income that will continue to grow over the years, this makes a lot of sense. On January 1, 2024, the share was worth $76.44. The fact that the price of that share went up 157% in that time period is also a decent incentive,&#8221; a comment reads.
&#8220;SCHD does not require its membership to grow their dividends by 10% in order to reach a fund growth rate of 10%. It often sells stocks yielding &lt;2% and buys safe stocks yielding 3% or 4%. This cycle (the reconstitution in March each year) creates this effect. It should theoretically hold in bull and bear markets. I fully expect 10% dividend growth over long periods of time,&#8221; another Redditor shared.
One comment pointed out external factors, such as economic downturns, that can impact SCHD&#8217;s performance.
&#8220;My issue is entirely with the fact that SCHD has not been tested in a bear market, nor a recession or depression. If the pool of companies from which SCHD selects to comprise itself collectively suffers through a lengthy stagnation (or worse), the growth of the dividend in real dollars may stagnate. I am expressing skepticism that the real dollar amount will continue to increase at a rate of 10% per year,&#8221; the comment reads.
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Reddit Explodes Over Dividend Math: 'How Much Would The Annual Dividend Be For a $280K Investment?' – Investors Debate SCHD's Future Growth

<a href="https://www.benzinga.com/markets/25/01/43239447/62-year-old-earning-up-to-120-000-in-dividends-shares-8-stock-picks-i-lived-below-my-means-there-isn">Dividend shares</a> and high-yield funds are among the most popular investment vehicles people choose to rely on for a consistent payout or to grow their money.
One of the most talked about dividend-oriented ETFs is Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>), which tracks the Dow Jones U.S. Dividend 100 Index.&nbsp;
SCHD is known for its focus on high-quality, dividend-paying U.S. companies, making it a go-to fund among investors seeking reliable <a href="https://www.benzinga.com/markets/25/01/43005162/dividend-investor-retired-at-39-living-off-dividend-income-shares-his-top-4-stocks-its-absolutely-do">income</a>. But is it a smart move to allocate a considerable portion of your portfolio to SCHD? This question lies at the heart of a recent Reddit post that sparked a lively debate among the board&#8217;s users.
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The poster is an investor who has already allocated $100,000 to SCHD, another $100,000 to Vanguard S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOO#NYSE">VOO</a>), and has also bought some individual stocks. His end goal is to build a portfolio that generates dependable income in the long run without taking risks.
&#8220;Is it stupid to put in that much into SCHD instead of spreading it, or? I just want a safe place to keep it that is better than a money market account or [high-yield savings account],&#8221; the poster wrote.
He also mentioned he&#8217;s a bit concerned about the long-term performance of SCHD since he&#8217;s planning on investing for 20 more years and is also considering diversifying into other assets like real estate investment trusts or other dividend-focused stocks but isn&#8217;t sure this is necessary.
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The Reddit community offered the poster insights in the comments, so let&#8217;s dive right in.
<h2 class="wp-block-heading">20-Year Investment Plan? Reddit Debates As Investor Pours $100,000 Into SCHD</h2>
SCHD is a Solid Choice for Long-Term Dividend Growth
Many Redditors praised SCHD as a reliable ETF for long-term dividend growth, especially for investors not willing to make risky moves.
&#8220;Putting $100,000 into SCHD and letting it go to work for 20 years–that is the epitome of smart investing,&#8221; a comment reads.
&#8220;Seems like you are seeking low-risk monthly income. SCHD is fine,&#8221; another Reddit user said.
One commenter agreed with the poster&#8217;s approach and shared that he would sleep well at night if he had the same allocation.
&#8220;Not stupid at all. It&#8217;s a fine investment and will pay you to wait during market downturns. Personally, I have about 30% of my portfolio in bond ETFs for diversification, but I could sleep well at night with an allocation like yours too,&#8221; he said.
Another Redditor echoed the above comment but also mentioned that the fund should double the dividends every few years with a dividend reinvestment plan.
&#8220;Yeah, it's a solid place to park $100,000. My portfolio looks really similar, I have no trouble sleeping at night. SCHD dividend growth should allow your dividend to double every 6 to 7 years with DRIP,&#8221; he wrote.
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Consider Diversifying to Mitigate Risk
While most commenters were on board with the poster&#8217;s allocation to SCHD, some Reddit investors suggested he diversify a bit further to mitigate risk.
&#8220;It is not stupid. However, I might suggest you consider 50% in SCHD and 50% in [Schwab U.S. Large-Cap Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schg#NYSE">SCHG</a>)],&#8221; a comment reads.
One Reddit user recommended the investor allocate a part of his portfolio to non-U.S. assets to hedge against any rotations of U.S. stocks.
&#8220;I guess the only obvious downside, besides being all in stocks, is that it&#8217;s very U.S.-centric. While U.S. stocks have been the place to be for 20+ years, there are no guarantees that this will continue. I have some money in [Vanguard Total International Stock ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vxus#NYSE">VXUS</a>)] as a hedge against any rotations out of U.S. stocks. Not a lot–maybe 5-7% of my portfolio,&#8221; the user said.
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Another Redditor touched on international exposure, implying that such an allocation would enhance his portfolio resilience.
&#8220;I agree you should put the $100,000 and let it sit. You can let that sit and anything you invest outside of that, start to diversify. Someone said SCHG as well. That would be another good goal to set, just to get some international holdings. I would mix an international ETF and some dividend stocks in there. When you're older you could shift into bonds, higher dividend yield stocks, and keep SCHD if the dividend payout is significant enough,&#8221; his comment reads.
&#8220;It&#8217;s not stupid at all. I would suggest diversification in your portfolio though, so don&#8217;t make that 100% of your investment strategy,&#8221; another Redditor wrote.
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Stupid 20-Year Investment Plan? Investor Questions $200,000 Dividend Strategy – 'Is It Stupid To Put In That Much Into SCHD?'

<a href="https://www.benzinga.com/markets/25/01/43005162/dividend-investor-retired-at-39-living-off-dividend-income-shares-his-top-4-stocks-its-absolutely-do">Dividend</a> investing has long been a favorite strategy for those seeking a reliable <a href="https://www.benzinga.com/markets/25/02/43679558/how-this-39-year-old-with-no-college-degree-built-passive-income-streams-that-pay-18-000-per-month">passive income</a> stream, especially as they approach <a href="https://www.benzinga.com/personal-finance/25/02/43768114/im-66-still-working-maxing-out-my-401k-and-could-retire-next-year-should-i-stop-saving-for-retirement-and-start-living">retirement</a>. By investing in dividend-paying stocks or ETFs, individuals can generate stable earnings while potentially profiting from capital appreciation.
Compared to growth-focused investments, the yield generated is often lower. Instead, this approach offers more safety and fewer risks and is a favorite of risk-averse investors.
In a recent Reddit post, a user shared his ambitious retirement plan: at 50, the investor has decided to put $3,000 a month into the Schwab U.S. Dividend Equity ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SCHD#NYSE">SCHD</a>) to accumulate close to $1 million in 10 years.
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His main objective is to generate $25,000 annually in dividends, which, alongside his $2,000 monthly Social Security benefits, would provide him with a comfortable retirement income of around $4,000 per month, a good sum since he&#8217;s considering retiring to a low cost of living country like Mexico or Southeast Asia.
The investor is focused on SCHD, and despite his confidence in the ETF, he is open to feedback and alternative strategies, as he wants to ensure his plan is realistic.
His post has received a ton of advice and suggestions, so let&#8217;s dive right into that.
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<h2 class="wp-block-heading">$25,000/Year in Dividends With SCHD? Redditors Weigh In</h2>
Adjust Your Expectations
In an overwhelming majority, the Redditors who commented below the investor&#8217;s post agreed that the expectations he set were too high, so he needs to either adjust these or rethink his strategy.
&#8220;You'll reach half your goal if you're lucky in 10 years. Use a compound interest calculator and run numbers,&#8221; a Redditor wrote.
&#8220;Your calculations are wrong. $3,000/month for 10 years with 7% interest is $516,000," another comment says.
A user underscored the impact of inflation on the investor&#8217;s retirement income, calculating the yearly dividends he would get with his investment.
&#8220;At 10% returns, you will be just shy of $600,000. With a 3.5% yield, you will be looking at about $21,000 per year in dividends. This is not adjusted for inflation. Inflation-adjusted 7% return will get you $500,000. With a 3.5% yield, you will be looking at about $17,500 per year in dividends. It will help if you can increase the contributions for at least the first 5 years and do it for 12 years instead of 10 till you are 62 years of age,&#8221; he said.
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Look Into Alternative Strategies and Diversify
Several users advised the poster to diversify his portfolio beyond SCHD to achieve his aim because while SCHD is a solid choice for dividend income, the fund may not provide the growth needed to reach $1 million in 10 years.
&#8220;If you want income in the shortest period of time you should look for a fund with a higher yield such as [NEOS S&amp;P 500 High Income ETF (CBOE: SPYI)] 11% yield, [NEOS Nasdaq-100 High Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/qqqi#NASDAQ">QQQI</a>)] 13%, or [Putnam BDC Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/pbdc#NYSE">PBDC</a>)] 9%; Keep [Vanguard Total Stock Market ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vti#NYSE">VTI</a>)] and drop SCHD,&#8221; a Reddit user suggested.
This comment recommended the poster use a balanced approach by combining three ETFs.
&#8220;Maybe add a blend like a 3-fund portfolio. 50% SCHD, 25% [Vanguard S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voo#NYSE">VOO</a>)], and 25% [Schwab U.S. Large-Cap Growth ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schg#NYSE">SCHG</a>)]. Work on compounding SCHD but get some growth and then convert it into SCHD in retirement,&#8221; the comment reads.
Another user advised the poster to move his money into a higher-yield asset as he approaches retirement.
&#8220;I had to reread your goal. My estimate is you will have around $600,000 in 10 years. Making $21,000 off of that is very easy to do if you move to a higher dividend fund like [JPMorgan Equity Premium Income ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/jepi#NYSE">JEPI</a>)]/[JPMorgan Nasdaq Equity Premium Income ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/jepq#NASDAQ">JEPQ</a>)] or SPYI. My average dividend income of $500,000 is $38,000 minus taxes. So well above what you expect. As you get closer to ten years, start moving into preferred stock or income funds mentioned above,&#8221; the user suggested.
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50-Year-Old Pours Cash Into SCHD, Plans Early Retirement Overseas – 'I'm Trying To Make About $25,000/Year In Dividends, Is This A Bad Idea?'

<a href="https://www.benzinga.com/trading-ideas/25/02/43827291/exclusive-will-trumps-tariffs-hurt-or-help-stock-market-59-say-this">Tariffs</a>, elevated mortgage rates, and the cost of maintaining a home amid soaring insurance and energy costs have caused pessimism amongst the home builders tasked with adding housing inventory.
The information comes from the National Association of <a href="https://www.benzinga.com/25/01/43246599/bofa-downgrades-dr-horton-and-smith-douglas-citing-cost-pressures-and-weak-roe-outlook">Home Builders</a><a href="https://www.nahb.org/news-and-economics/housing-economics/indices/housing-market-index"> NAHB</a>/Wells Fargo Housing Market Index, which tracks builders&#8217; confidence in single-family homes based on a monthly survey. February marked the lowest confidence level in five months.
<h2 class="wp-block-heading">Tariffs</h2>
According to NAHB,<a href="https://www.nahb.org/advocacy/top-priorities/material-costs/how-tariffs-impact-home-building"> 7%</a> of all goods used in new residential construction originate from a foreign nation. &#8220;With 32% of appliances and 30% of softwood lumber coming from international trade, uncertainty over the scale and scope of tariffs has builders further concerned about costs,&#8221; NAHB Chief Economist Robert Dietz said on its website.
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NAHB Chairman Carl Harris<a href="https://www.nahb.org/-/media/NAHB/advocacy/docs/letter-to-president-potential-tariffs-013125.pdf?rev=4f33c6137e9846b1866e4692241d2a1d&amp;hash=C2AEFB98FFB519145B3C4DF50296B2B8"> sent a letter</a> to President Donald Trump urging him to exempt &#8220;critical construction materials&#8221; from his tariff policies.
&#8220;Imposing additional tariffs on these imports will lead to higher material costs, which will ultimately be passed on to home buyers in the form of increased housing prices,&#8221; he said in the letter dated Jan. 31.
<a href="https://www.corelogic.com/intelligence/will-trump-tariffs-harm-home-affordability/#framing-affordability">CoreLogic</a>, a real-estate data company, estimates that the higher costs of building materials could add between $17,000 and $22,000 to the cost of building an averagely priced newly constructed home, which is currently about $422,000.
Trending: Unlock the hidden potential of commercial real estate —<a href="https://equitymultiple.com/benzinga?invite=benzinga&amp;utm_campaign=product-promotion-earn&amp;utm_source=yahooFinance&amp;utm_medium=affiliate&amp;utm_content=unlockboost-yahoo"> This platform allows individuals to invest in commercial real estate offering a 12% target yield with a bonus 1% return boost today!</a>
<h2 class="wp-block-heading">Interest Rates</h2>
Lower interest rates could have made the Trump tariffs easier to digest. However, despite optimism last year for a series of <a href="https://www.benzinga.com/25/01/43319060/first-rate-cut-in-june-if-at-all-in-2025-economist-says-as-federal-reserve-holds-rates-steady">interest rate cuts</a>, stubborn inflation has caused the Fed to keep rates where they are, which is currently just below 7%, too high to move the needle on home buying.&nbsp;
&#8220;It will take people longer to buy homes as they wrestle with affordability,&#8221; Holden Lewis, home and mortgage expert at NerdWallet told<a href="https://www.marketwatch.com/picks/mortgage-rates-will-pull-back-4-pros-predict-where-mortgage-rates-will-go-in-february-2025-5e015a1c"> MarketWatch</a>. &#8220;As homes linger on the market, the inventory of for-sale homes will keep rising. This increase in supply will diminish upward pressure on prices. Home prices will rise this spring, but not as swiftly as they rose in the past.&#8221;
See Also: Commercial real estate has historically outperformed the stock market, and<a href="https://equitymultiple.com/benzinga?invite=benzinga&amp;utm_campaign=product-promotion-earn&amp;utm_source=yahooFinance&amp;utm_medium=affiliate&amp;utm_content=stockmarket-yahoo"> this platform allows individuals to invest in commercial real estate with as little as $5,000 offering a 12% target yield with a bonus 1% return boost today!</a>
<h2 class="wp-block-heading">Insurance</h2>
Compounding the effect of tariffs and interest rates is the soaring cost of <a href="https://www.benzinga.com/personal-finance/25/02/43728496/with-insurance-maintenance-costs-and-rising-home-prices-suze-orman-says-its-ok-to-just-rent">homeowners insurance</a>, particularly in disaster-prone states, as most recently seen with the LA wildfires. According to<a href="https://home.treasury.gov/system/files/311/Analyses_of_US_Homeowners_Insurance_Markets_2018-2022_Climate-Related_Risks_and_Other_Factors_0.pdf"> figures</a> released by the US Treasury Department for 2018-2022, insurance premiums have risen sharply across the country, with people living in the greatest climate-driven risks experiencing the steepest rises. Those in the top 20% of riskiest places for such perils paid, on average, 82% more than those in the 20% lowest climate risk zip codes.&nbsp;
This year,<a href="https://www.bankrate.com/insurance/homeowners-insurance/homeowners-insurance-cost/"> Bankrate</a> showed that the national average cost of home insurance is $2,258 per year for a policy with a $300,000 dwelling limit. —amounting to about $188 per month, a<a href="https://www.cnbc.com/select/homeowners-insurance-skyrocketing-how-to-lower-premium/"> marked increase</a> on the preceding two years.
The<a href="https://www.wsj.com/economy/housing/home-insurance-property-tax-vs-mortgage-cost-43ab76ed"> Wall Street Journal</a> calculated that insurance and taxes make up more than half of the monthly mortgage payment for 9% of single-family mortgages, up from less than 4% at the end of 2014. Adding tariffs and increased construction and home prices to the mix makes homeownership more difficult than ever for many Americans.
Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today.<a href="https://smartasset.com/retirement/find-a-financial-planner?utm_source=benzinga&amp;utm_campaign=ben&amp;utm_content=y2_5MilNestEgg"> SmartAsset&#8217;s free tool matches you up with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost</a> to decide which one is right for you.
<h2 class="wp-block-heading">Looking For Higher-Yield Opportunities In A Shifting Market?</h2>
The changing interest rate environment has created an incredible opportunity for income-seeking investors to earn massive yields, but not through dividend stocks… Certain private market real estate investments are giving retail investors the opportunity to capitalize on these high-yield opportunities and Benzinga has identified <a href="https://www.benzinga.com/money/benzingas-favorite-high-yield-investments">some of the most attractive options for you to consider</a>.&nbsp;
For instance, the <a href="https://www.benzinga.com/go/equitymultiple-yf">Ascent Income Fund</a> from EquityMultiple targets stable income from senior commercial real estate debt positions and has a historical distribution yield of 12.1% backed by real assets. With payment priority and flexible liquidity options, the Ascent Income Fund is a cornerstone investment vehicle for income-focused investors. First-time investors with EquityMultiple can now invest in the Ascent Income Fund with a reduced minimum of just $5,000. <a href="https://www.benzinga.com/go/equitymultiple-yf">Benzinga Readers: Earn a 1% return boost on your first EquityMultiple investment when you sign up here (accredited investors only)</a>.
Don't miss out on this opportunity to take advantage of high-yield investments while rates are high. <a href="https://www.benzinga.com/money/benzingas-favorite-high-yield-investments">Check out Benzinga's favorite high-yield offerings.</a>&nbsp;

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Tariffs, Mortgage Rates, And High Housing Costs Have Caused Builders To Change Strategy On New Home Construction

A TikTok <a href="https://www.tiktok.com/@proudunionguy/video/7471336532293553451">video</a> by Proud Union Guy is getting a lot of attention for calling out &#8220;bootlickers&#8221;—those who defend corporate profits over fair wages and labor rights. The video has sparked intense discussions and over a thousand comments on Reddit and TikTok from people venting their grievances and experiences.
<h2 class="wp-block-heading">What's A Bootlicker?</h2>
According to Proud Union Guy, a &#8220;bootlicker&#8221; is someone who sides with corporations at the expense of workers. For example, he says that if you think record corporate profits are fine but get upset when <a href="https://www.benzinga.com/news/24/10/41303608/hundreds-of-hilton-hotel-workers-strike-at-seattle-airport-demand-higher-wages-and-reversal-of-covid">workers demand higher wages</a>, you might be a bootlicker. If you believe staying late without pay proves dedication instead of being exploited, same deal.&nbsp;
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Other signs include blaming high prices on worker pay instead of <a href="https://www.benzinga.com/government/24/05/38724294/biden-says-hes-already-turned-economy-around-blames-corporate-greed-for-persistently-high-inflation">greedy companies</a>, thinking unions have too much power while ignoring how big businesses control everything, or getting mad at workers on strike instead of the companies paying them unfairly.
<h2 class="wp-block-heading">Workers Are Weighing In</h2>
The video quickly took off, with many viewers agreeing and sharing stories of coworkers who fit the description. One <a href="https://www.reddit.com/r/UnitedAssociation/comments/1ippfvp/we_all_know_somebody_that_would_flunk_this_quiz/">Reddit</a> user commented, &#8220;I bet we all know a guy or two working after hours doing paperwork or taking phone calls.&#8221; Another pointed out, &#8220;My foreman at my last job told my partner and I that we should be grateful to have a job. Kind of funny since the only reason he was a foreman was through nepotism.&#8221;
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One worker said, &#8220;Way too many trumpy guys in the unions voting for our own downfall because they've been poisoned by social media propaganda,&#8221; expressing their annoyance at coworkers who vote against their own interests. One user even &#8220;outed&#8221; their son as a bootlicker saying, &#8220;My dumbass kid is one of them. Funny thing is, I&#8217;m non-union ([International Brotherhood of Electrical Workers] is weak af where I live) but he&#8217;s [United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada]. He drank the Kool aid and voted against his own self interests, despite me trying to talk him out of it. Now he&#8217;s all pissed because he feels lied to. I tried to tell ya kiddo.&#8221;
See Also: If there was a new fund backed by Jeff Bezos offering a <a href="https://www.benzinga.com/money/arrived-private-credit-fund">7-9% target yield with monthly dividends would you invest in it</a>?
<h2 class="wp-block-heading">Not Everyone Agrees</h2>
While the video got a lot of support, not everyone was on board. Some critics mocked the TikToker's delivery, pointing out his sunglasses, clean gear, and toothpick as signs of trying too hard. Others argued that unions sometimes protect <a href="https://www.benzinga.com/25/02/43723246/meta-faces-backlash-as-laid-off-workers-say-they-were-unfairly-targeted-despite-strong-performance-records">underperforming workers</a>, sharing their own negative experiences. A few even questioned the term &#8220;bootlicker,&#8221; noting that billionaires don't wear boots, so maybe &#8220;Italian shoe licker&#8221; would be more accurate.
Whether you agree with Proud Union Guy or not, the debate over labor rights and fair pay isn't going away. With corporations <a href="https://www.benzinga.com/government/regulations/25/02/43596413/corporate-americas-best-earnings-in-3-years-will-tariffs-end-wall-streets-honeymoon">raking in record profits</a> while many workers struggle, conversations about who benefits from the system—and who defends it—are bound to continue.
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'Are You A 'Bootlicker?' Viral Video Lists The Signs Of A Corporate Bootlicker, And People Are Calling Out Their Coworkers

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