Investment dividend Income from $10,000
Financial freedom, where the passive income from your investment is equal or greater than your lifestyle expense. Financial freedom amount is base on your your lifestyle expenses. Would the dividend income from a small amount of $10,000 pay your phone bill?, electrical bill?, your rent? Let’s find out.
Life would be much better if you work because want to and not because you have to. So let’s start moving in the financial freedom direction. There are many type of investment, here some of the most well known.
The Dow or Dow Jones Industrial average
The Dow meaning Dow Jones Industrial average is a index fund. It’s composed of 30 US companies.
If you buy a mutual index fun or a ETF index fund that track the Dow, you could receive a dividend yield of over 1.5%. If you were to received a dividend yield of 2% on a $10,000 dollar investment. Then you would be receiving a yearly income of $200 or a monthly income of $16.66.
S&P 500
S&P 500 is a index fund, it’s compose of 500 US companies. Some of these companies provided only growth stock, some provide dividends , some provided both, and some provided none, The good one stay on the list and the bad one get delisted.
By buying S&P 500 you own part of the entire industry and sector that make up the stock market. Even though the stock market goes up and down, in the long run the stock market price tend to goes up.
If you buy a mutual index fund or a ETF index fund that track the S&P500, you could receive a dividend yield of less than 1.5 %. If you where to received 1.5 % dividend yield on a $10,000 dollar investment. Then you would be receiving a yearly income of $150 or a monthly income of $12.50 dollars.
High dividend and low volatility
You can also invest into High dividend and low volatility(risk) S&P 500 index fund. Instead of holding the 500 US companies, It only hold the one that pay the highest dividend yield.
You could receive a dividend yield of around 4%. If you were to received 4% dividend yield on a $10,000 investment. Then you would be receiving a yearly income of $400 or a monthly income of $33.33.
There are many types of dividend Yields. Some give 9% dividend yield. Some do well during bull market and bad during bear market. And vise versa, another do well during bear market and bad during bull market. You may want to check aristocrat
Single industry or sector
You can also achieve higher dividend is by selecting a single industry or sector. Such as Real estate or health care etc.
Dividend yield is around 3%. You could receive a dividend yield of around 3%. If you were to received 3% dividend yield on a $10,000 investment. Then you would be receiving a yearly income of $300 or a monthly income of $25.
Individual stocks
Not recommended by many for two main reasons. One is that is extremely difficult to time the market and two nobody can see the future. It would require a lot constant research and learning. But you still have the options to do individual stocks if you wish to.
You may want to check individual aristocrat dividend companies. Since they have consistently paid dividends every year to its investors for the last 25 years.
You could receive a dividend yield of around 5%. If you were to received 5% dividend yield on a $10,000 investment. Then you would be receiving a yearly income of $500 or a monthly income of $41.66.
Now, start and adjust as you go.