Simply put, income investing is defined as assembling a collection of different investments – which may involve a variety of investment styles and asset classes – that can create regular income for investors.
There are typically two ways to choose from that allow investors to profit from investments. The first method involves appreciation on an investment’s value. This effectively results in gains made on top of the initial payment made for an investment after selling it.
The second approach concerns income payments periodically, in the form of dividends or interest from an investment. While dividends are usually paid out quarterly, interest can occur more frequently and is often accrued monthly.
Not all kinds of investments offer the possibility of both income and appreciation payments. For instance, some specific stocks won’t pay out a dividend, which represents the reward of a steady income stream for investors.
Other investments that generate income, like a certificate of deposit (CD), money market funds and personal savings accounts, will pay interest out on regularly but won’t offer the chance of price appreciation.
If you’re keen to create portfolio that can generate income, or you require investment advice in Shropshire or Chester, we can help. At Hartey Wealth Management, we offer a wide range of select services, including portfolio management and estate and retirement planning. We can also offer you a second opinion on your current investments to ensure they are performing for you.
Get in touch today for any assistance required, and we’ll make your money work that little bit harder for you.