I earned those high rates of interest for several years, and I came to expect them.

So when rates started to fall in the 2000s and banks and brokers began to pay as close to zero interest as they could, it was incredibly frustrating for me – as it was for all savers.

Today, the yield on the 10-year Treasury (a good proxy for interest rates) is a little more than half of where it was when I first ventured out into adulthood. So you’d think my Schwab account would pay somewhere around 2%, right?

Wrong!

Just as I’m still anchored to the 4% interest I received when I was young and impressionable, the banks and brokers are still intent on paying the nearly 0% interest they’ve been paying for the past 15 years or so.

My Schwab account pays me the princely sum of 0.45%. My bank pays even less. Suffice it to say, I keep very little cash in those accounts.

But that doesn’t mean there aren’t good income opportunities out there. You can earn 5% or more in some short-term Treasurys and certificates of deposit (CDs). Now, you do have to lock up your money for the full term, but it can be for very short amounts of time.

For example, you can earn 5.5% annualized on a one-month Treasury bill. And T-bills are liquid enough that you can sell them if you need to get your money out.

Of course, there’s no guarantee you’ll get all of your money back, as the bond’s price could fluctuate. But if you wait four weeks to get access to your funds, you are guaranteed to get all of your money back plus interest.

For those who are comfortable making longer-term investments in order to obtain higher yields and potential capital gains, corporate bonds are a great choice.

Right now, you can lock in a 5.4% yield on “A” rated corporate bonds for two years. These are extremely safe bonds.

If you go down to “BBB-” rated bonds, which are still investment-grade and very safe, you can earn as much as 7.4%. And if you’re willing to take on a bit more risk, you can earn more than 11% on some “BB-” rated bonds. (That’s at the high end of the range, but it is available.)

Plus, if economists and Wall Street are correct and the Fed lowers rates several times this year, bond prices will soar, because they move in the opposite direction of interest rates.

Bonds are in a sweet spot right now. If rates don’t move, bond investors will continue to receive their highest levels of interest in the past 15 years or so. And if rates fall, those higher yields will become even more valuable and bond prices will jump, offering the opportunity for even greater returns.

Life has gotten pretty expensive in the past few years. Savers and investors need every dollar working hard for them. We’re in a perfect environment for bonds to generate strong yields and potential profits.

If you don’t own any bonds, consider adding some to your portfolio today – whether they’re short-term Treasurys or higher-yielding corporates.

The post A Goldilocks Environment for Bonds appeared first on Wealthy Retirement.

Bonds.

Before your eyes glaze over, this is important.

Bonds belong in everyone’s portfolio. Now, I’m not talking about bond mutual funds or exchange-traded funds.

Today, I want to talk about what you need to know about individual bonds.

First of all, what exactly is a bond?

It’s pretty simple. A bond is a loan that you make to a company or government agency. If we’re talking corporate bonds, then you’re loaning money to a company for a specific amount of time for a specific interest rate.

Bonds are typically sold in $1,000 increments, and they always have a maturity date and a coupon. For example, let’s say there’s a bond that has a 5% coupon and a maturity date of February 1, 2025. If you decide to purchase the bond – meaning you’re lending $1,000 to the underlying company until February 1, 2025 – you will receive 5% per year in interest (which is usually paid in two installments each year). And on February 1, 2025, you’ll get the $1,000 back.

Now, here’s the important part. If you buy or sell a bond in the market, it may not trade for $1,000.

When it is first issued by the company, it will. But as soon as it starts trading, the price will vary.

So you could buy the bond for $900. In that case, you’ll receive more than 5% per year because the 5% coupon is based on the $1,000 figure. No matter where the bond is trading, the bond will pay $50 per year in interest. So if you pay $900 for the bond, you’ll make 5.6% interest ($50 divided by $900 equals 5.6%).

If you pay $1,050 for the bond, you’ll make 4.8% ($50 divided by $1,050 equals 4.8%).

Here’s another important feature: At maturity, a bond pays $1,000, regardless of what you paid for it.

It’s obvious why you might buy a bond for $900 when you know you’ll get $1,000 at maturity plus interest, but you may be asking why someone would pay more than $1,000 for a bond if they know they’ll lose money at maturity.

That’s because even with the loss, they may still make more than they would in other places.

For example, let’s say a bond is trading at $1,050 with a 5% coupon until 2028. Even though an investor will lose $50 at maturity, they will collect $50 in interest per year over the next five years.

When you subtract how much the bond loses at maturity from the total amount of interest paid, that comes out to $200, or an average of $40 per year. That equates to 4% per year. With the market having dropped 8.4% since the start of 2022, investors ought to be very happy earning a safe and secure 4% per year.

One last thing about bonds – and this is really important – is how they differ from stocks.

If you hold a stock for five years, anything can happen. It could go up 10 times, it could get cut in half, it could go to zero or it could go anywhere in between.

While a bond’s price will fluctuate, on the maturity date, the bond will be worth $1,000. The only way it won’t is if the underlying company goes bankrupt.

So you could own a stock that has putrid earnings and falls 40%. But as long as the company is keeping the lights on, regardless of those putrid earnings, its bonds will be worth $1,000 at maturity. The only way you lose as a bondholder is if the company goes under.

That’s a major reason people buy bonds. They earn some income while holding bonds, but bonds stabilize their portfolio. If you buy bonds properly, you can be extremely confident you’re going to get your money back and make money.

In fact, I have never lost money on a bond – both on bonds I’ve invested in personally and on bonds I’ve recommended to subscribers of my VIP Trading Service Oxford Bond Advantage.

The post Why Bonds Belong in Your Portfolio appeared first on Wealthy Retirement.

You should have a variety of stock types – such as small caps, large caps, international stocks, etc. – in different sectors. But a diversified portfolio should also have fixed income, precious metals and real estate holdings.

This helps smooth out volatile periods in the stock market, like we’ve been experiencing for the past year.

Until recently, the problem was that interest rates were so low that fixed income investments were simply not attractive. Treasurys paid next to nothing, and there was a time when you had to buy junk bonds just to earn 4%. For many investors, that was too much risk to earn a paltry 4%.

But that’s changed in a very big way in the past few months.

Just six months ago, a 10-year Treasury yielded 2.6%. Today, it’s 50% higher, just shy of 4%.

Investment-grade corporate bonds are yielding as much as 7.5% for two- or three-year maturities, and non-investment-grade bonds yield 8% or more.

Earning 7.5% on a pretty safe investment-grade corporate bond goes a long way in making up for downturns in stocks. Considering that the average annual stock market return is between 8% and 10%, earning 7.5% in a bond is pretty attractive.

Over the past 93 years, there were only four times when bonds and stocks were down in the same year.

Furthermore, since 1926, stocks have ended a year down 25 times, with an average loss of more than 13%. Bonds were down 15 times with an average loss of just 2.4%.

Last year was a terrible year for bonds – the worst in more than 40 years. Should we expect a repeat performance this year?

Since 1926, bonds have had negative returns two years in a row only twice. And the cumulative losses of those two-year periods were just 3.7% and 2.4%.

So if you’re worried about a recession, you definitely need to own bonds. Over the past 50 years, bonds have outperformed large cap stocks during economic downturns.

When it comes to the bond portion of your portfolio, I strongly recommend individual bonds rather than bond funds. With individual bonds, you know how much they will be worth on a certain date. At maturity, bonds are worth $1,000, regardless of what you paid for them or where they were trading at an earlier date. Unless the company declares bankruptcy, you will receive $1,000 for the bond at maturity.

Bond funds are worth only the price at which they are trading. If bonds are down, bond funds will be down. And if you sell, you will lose money.

If you own individual bonds, you’ll get $1,000 per bond when they reach maturity – even if the whole bond market is down at the time.

Bonds can sometimes be less exciting than stocks. But they’re not supposed to be exciting. They’re supposed to make you money – especially when other things aren’t working – and provide safety in your portfolio.

If you don’t have bonds in your portfolio, now that interest rates are higher, this is the time to start buying.

You can earn some solid yields while protecting your wealth at the same time.

The post How to Protect Investments in Volatile Markets appeared first on Wealthy Retirement.

Most investors should own some in their portfolio to help ride out tough stock markets – like the one we’re currently in – because bonds provide some ballast and safety.

Bonds have a par value of $1,000. The only way you won’t get paid $1,000 at maturity is if the company declares bankruptcy. Otherwise, no matter what is going on in the markets or the economy, you’ll get paid $1,000 per bond at maturity.

Now that interest rates have climbed up off the floor, bond investors can finally earn some real yield.

You can earn 5.5% by owning investment-grade bonds that mature in two years. Or 4.6% in a tax-free municipal bond with the same maturity. That’s a taxable equivalent of more than 6% if you’re in the 32% tax bracket.

And as the Fed continues to raise interest rates to fight off inflation, the yields should get even better.

Not only will you earn strong yields for the first time in years, but those bonds should increase in price once the Fed stops raising rates and starts lowering them.

Bond prices move in the opposite direction of interest rates.

It makes sense when you think about it.

If you can buy a bond for par value ($1,000) that yields 5%, when interest rates rise, no one will buy the bond that yields 5% if they can get a similar new bond that yields 5.5% because interest rates just went up.

So in order for that 5% bond to be able to be sold, the price has to come down to push the yield higher.

A bond with a 5% coupon pays out $50 per year ($1,000 x 5%, or 0.05 = $50). But you can’t just raise the interest on a bond the way you can raise a dividend. The interest rate is fixed. So the market will adjust the price of the bond so that the same $50 now yields 5.5%. In this example, the bond will fall to about $909 because $50 in interest divided by $909 is 5.5%.

Similarly, if rates drop, a bond with a 5% coupon will become more valuable because a new bond won’t have as attractive a yield. If a new bond pays 4.5%, then the 5% bond will climb to $1,111 because $50 divided by $1,111 equals 4.5%.

So investors who buy bonds next year will have the opportunity to earn strong yields. If the Fed eventually lowers interest rates, the value of the bonds will go up as well, and they can then be sold for a profit or held until maturity, collecting a high rate of interest.

I have a few rules for investing in bonds that I strongly recommend investors follow.

• Buy only bonds you plan on holding until maturity. If the price goes up and you have the chance to take a profit, you can, but you should feel very comfortable owning the bond until the maturity date and collecting your interest.
• Don’t watch the price of your bond every day. If you’re going to own a bond until maturity, who cares where it’s trading today or tomorrow? You know that when it matures, it will pay out $1,000. So if the bond drops to $900 or rises to $1,050, it really doesn’t make much of a difference. You’re probably not going to sell it anyway.
• Understand the risks. Bonds are very safe. Investment-grade bonds (rated BBB- or higher) have a default rate of just 0.1%. Junk bonds, or non-investment-grade bonds, have higher yields but carry higher risk. They have a historical default rate of 4.22%, with most of those occurring in bonds rated CCC or lower. So even if you buy a junk bond rated BB, you can earn a higher interest rate than you would with an investment-grade bond, without taking on too much risk. Unless you’re willing to speculate, I recommend buying bonds rated BB or higher to drastically decrease the likelihood of default.
• Keep the maturities fairly short (for now). Don’t buy bonds with maturities more than five years out. It’s a good idea to have maturities staggered so that there is always some capital being freed that can be used for expenses or to invest in new bonds. So you may want to buy some that mature in two years and others that mature in three years, four years and five years.

I’m going to be putting more of my own money to work in bonds in 2023 to take advantage of higher yields and the safety that bonds provide.

I recommend investors do the same.

The post Why I’m Buying Bonds in 2023 appeared first on Wealthy Retirement.

ESG investing is investing with a conscience – and today, the investment opportunity is mind-blowingly massive.

Global ESG assets are on track to exceed $53 trillion by 2025.

That means more than one-third of all investment assets under management globally are expected to be ESG-compliant within four years.

There is zero doubt that there is going to be a torrent of money flowing into ESG stocks.

They will receive premium valuations because there will be so much money chasing them.

Their stock prices are going to do well.

But here is the weird thing…

These ESG money flows may also signal a big investment opportunity in anti-ESG stocks – the stocks that ESG funds are not allowed to own.

This Stock Is Dirt Cheap, but the Bond Market Still Loves the Company

Bond investors as a group are generally thought of as the “smart money.” They are less prone to the type of wild speculation we often see in the stock market.

That is because bond investors are more focused on the underlying fundamentals of a company.

Bond investors are lenders. They are turning their money over to a company and need to know whether they are going to get paid back.

Bond investors do the really deep due diligence and figure out how much actual cash flows a business can generate.

Typical stock investors are much more emotional.

And sometimes stock investors aren’t even people – but rather, they are trading algorithms that don’t even know what a company does.

The smart bond market is telling me something fascinating today about Altria Group (NYSE: MO).

The bond market loves this tobacco manufacturer. Yet this is a business that is incompatible with ESG principles if there ever was one.

The Altria Group (CUSIP 02209sau7) September 16, 2026, 2.625% coupon bonds currently offer a minuscule yield to maturity of 1.31%.

I wouldn’t lend my wife money for five years at a rate that low!

The bond market is telling us that Altria Group’s cash flows over the next five years are sound.

The Altria Group (CUSIP 02209sav5) September 16, 2046, 3.875% coupon bonds are even more astounding. The current yield to maturity on this tranche of debt that matures 2 1/2 decades from now is only 3.7%.

Again, that is a clear signal that the bond market sees Altria Group’s long-term cash-generating ability as extremely reliable.

That is interesting because the stock market has a very different view of Altria Group…

At Altria’s current share price, its dividend yield is a whopping 7.35%.

That is more than 5.5 times more income than Altria’s 2026 bonds provide and twice the income that Altria’s 2046 bonds generate.

Not only is Altria Group’s dividend huge, but the stock also trades at a dirt-cheap, single-digit price-to-earnings multiple.

So while the bond market clearly loves the long-term cash-generating ability of Altria Group, the stock market does not.

What Are We Supposed to Make of This?

Somebody is very wrong about Altria Group.

The bond market is bullish about this company’s future cash-generating ability.

The 3.7% yield on those 2046 bonds is a strong vote of confidence from the smart money. I wouldn’t give my money to the U.S. government for 20 years at that rate.

Meanwhile, the stock market is decidedly bearish. That 7.35% dividend yield and the single-digit price-to-earnings ratio tell us that the market is pricing Altria as a company in rapid terminal decline.

The stock market is certainly telling us that Altria Group’s ability to continue to fund its dividend is questionable.

Who is right?

I’m inclined to bet on the bond market.

If I am right, that means the stock market is greatly undervaluing Altria Group’s future cash flows. It would also mean that, with this 7.35% dividend yield, Altria Group is one heck of an income-producing investment opportunity.

The cause of this disconnect between the stock and bond markets is pretty simple to explain. I believe the stock market is no longer capable of properly valuing Altria Group or other companies that similarly aren’t ESG-compliant.

There are now just too many institutional funds that are not allowed to own a business like this.

Plus, many of the institutions that do own Altria Group are likely unloading shares to become more ESG-friendly.

For investors willing to own an anti-ESG stock like Altria, with its 7.35% dividend yield, this could be an opportunity to make some money.

Good investing,

Jody

The post Who’s Right About Altria Group? appeared first on Wealthy Retirement.

As you can see from the chart below, the recent 5.4% reading of the consumer price index is the highest inflation reading since 2008. And other than a short blip in 2011, inflation has been mostly nonexistent for more than a decade, spending most of the time below 2%.

That has changed suddenly as the world reopens. As fast as an uncoiling spring, people are opening their wallets to begin living the lives they’ve been denied for the past year.

Inflation is on everyone’s mind today, and that 5.4% figure doesn’t begin to tell the story. Prices are higher in nearly all walks of life – and in some, they’re up considerably. Have you ordered from a restaurant lately, considered buying a car or booked a hotel room?

Wall Street experts and economists are all talking about inflation today, yet almost no one was when I warned readers of my Oxford Income Letter last year that “inflation will be here sooner than most expect” and when we started positioning our portfolios accordingly.

Fed Chair Jerome Powell doesn’t share my concern, as he has vowed to keep interest rates near zero. Great news if you’re looking for a mortgage. Terrible news if you’re hoping your investments keep up with inflation.

Treasurys – a staple for conservative investors – pay nothing. The 10-year Treasury yields just more than 1.3%.

But even more aggressive bonds aren’t keeping up with inflation.

The average high-yield (junk) bond yields less than 4% today, down from nearly 6% two years ago (before the pandemic).

So where can an investor obtain a relatively safe yield that will keep up with inflation?

In 2012, I wrote the first edition of my book Get Rich with Dividends to answer that question – and the following year, I launched The Oxford Income Letter (we just celebrated our 100th issue).

The strategy behind both is my 10-11-12 System, which is focused on dividend growth for the exact situation we find ourselves in today. It shows investors how to earn 11% yields within 10 years or 12% average annual returns in 10 years with dividends reinvested.

We want our recommendations to not only keep up with inflation but also increase our buying power.

If, in 2013, you’d bought one of my first recommendations – Texas Instruments (Nasdaq: TXN) – and were still holding today, aside from seeing your stock go up by nearly seven times, your yield would be 11.9%, more than double the current rate of inflation.

Or consider Eaton Corp. (NYSE: ETN). It currently yields just 2%, but due to dividend raises, investors who bought it in 2015 when I first recommended it and still hold today are enjoying a 5.9% yield – again above the inflation rate.

If you’re relying on your investments for income, that income needs to be able to grow. There aren’t many safe investments that will do that.

And while all stocks carry risk, dividend growers outperform over the long term and have never had a down 10-year period as measured by the S&P 500 Dividend Aristocrats Index.

By investing in stocks that raise their dividends every year, you’re boosting your buying power.

Whether inflation drops back down to 2% or goes up higher from here, if your dividends are growing by 7%, 8%, 10% or more, you won’t have to worry about rising prices because your dividends should have you covered.

As inflation continues to rise (as I expect), dividend growth stocks will help you beat it.

Good investing,

Marc

The post How Are You Going to Keep Up With Inflation? appeared first on Wealthy Retirement.

I’m being snarky.

During the campaign, Biden said he would propose raising taxes on corporations and on the highest earners – though it’s hard to imagine a tax increase while the economy is still hobbling.

But anyone born before Sunday (yesterday) knows that tax increases usually are not limited in scope.

As of this moment, the president has said that only individuals making more than $400,000 a year will see their taxes raised to 39.6%. Taxpayers making more than $1 million will have their dividends and long-term capital gains taxed at their ordinary income tax rate, which would be the new 39.6%.

Corporations would also see their tax rate increase to 28% from 21%.

Keep in mind, these are just campaign proposals at this point. There’s a long way to go, including having these tax increases passed in Congress, before they go into effect.

But if we assume for a minute that these tax increases will be implemented, let’s talk about what it means for your investments, specifically your dividend stocks…

Unless you’re in the top 0.35% of taxpayers, your taxes on dividends and capital gains won’t increase under the current proposal. So there is no immediate action that needs to be taken.

For those making more than $1 million per year, it would be a good idea to work with your tax professional on ways to better protect your income.

Many investors keep their higher-tax investments (like bonds) in a tax-deferred account while holding their lower-tax dividend stocks in a taxable account.

Bond interest is currently taxed at ordinary income tax rates, while dividends are taxed at 15% to 23.9% for the highest earners.

Should dividends and capital gains be raised to the ordinary income tax rate, there will be no difference in how stocks and bonds are taxed. So it may make sense, particularly if you’re reinvesting the income, to hold the dividend payers in a tax-deferred account.

With a higher tax rate on dividends for the wealthy, CEOs and board members (who tend to be very high earners) may have more incentive to use excess cash to buy back shares rather than pay a dividend that is taxable to them at nearly 40%.

I hate that idea.

Companies have a long history of buying back shares at the wrong time (when their stocks are at high valuations). Meanwhile, few companies were repurchasing shares in 2008 and 2009 or in the second quarter of last year.

Studies show that companies typically wait until their stock prices are high to buy their shares back, which is not a good use of capital.

If there is excess cash, pay it to shareholders in a dividend. Let them decide whether the stock is still a good buy.

And with corporate free cash flow forecast to rise 29% in 2021, companies will have lots of extra cash.

Now for Something Special…

Don’t be surprised if you see special dividends in 2021.

Companies with excess cash will occasionally pay a special dividend in addition to their regular one.

For example, Costco (Nasdaq: COST) has paid a special dividend three times in the past five years, including a $10 per share special dividend in December.

If it appears that tax rates will increase on dividends next year, I suspect a lot of companies will distribute cash to shareholders in the form of a special dividend.

Lastly, I have predicted that the next few years will see higher inflation than most people are expecting. The Federal Reserve has stated that it is going to allow inflation to rise more than usual before it taps on the brakes by raising interest rates.

So owning Perpetual Dividend Raisers – companies that raise their dividends every year – will become more vital to maintaining and increasing your buying power.

Owning a stock with a 3% yield and a dividend that doesn’t budge will erode your buying power after just two years of what is currently historically low inflation.

If we return to the average inflation rate of 3.1%, your 3% yield means you can buy fewer goods and services next year than you could this year.

However, if you own a stock that grows its dividend by 8% or 10% per year, you are actually increasing the buying power of that dividend over time.

And if you reinvest the dividend, compounding goes into overdrive when the company boosts the payout every year.

There will likely be some important changes on tax and economic policy down the road. I don’t expect anything drastic in 2021. But you should be thinking about the moves to make now so that when they happen, you’re not left scrambling, trying to better protect your money.

Good investing,

Marc

The post What Does a Biden Administration Mean for Dividends? appeared first on Wealthy Retirement.

With millions of people still confronting the economic aftershocks of COVID-19, our generosity is more bittersweet than ever – even with the average person spending $50 less on gifts in 2020 than they spent in 2019.

It doesn’t have to be this way…

In fact, with these top 10 simple tips for scoring “easy money,” you may find a surprise or two to help kick off 2021 on a high note…

10. Look for unclaimed assets.

An estimated $80 billion in assets languishes unclaimed in the United States. Often, this can be in the form of an insurance policy, an old account or a refundable deposit.

If individual states are unable to track down the assets’ owners, the funds can be used to cover government activities.

But it’s not too late to claim the property that’s rightfully yours. And now, with the help of the internet, it can take you as little as five minutes.

Simply visit MissingMoney.com to get started.

9. Take advantage of rebates.

When making major purchases, be especially mindful of any rebates that are offered.

It sounds simple, but between 50% and 70% of shoppers fail to claim rebates and up to one-quarter of them lose the forms needed to claim their money.

To avoid having your rebate denied, be sure to keep any receipts and act fast. And don’t hesitate to contact a company’s customer service department for help.

8. Take your employer up on retirement matching.

Many companies incentivize employees to save for retirement by offering matching on a certain percentage of 401(k) contributions.

Over the years, this has become an even higher priority. Far fewer companies suspended their matching programs during this spring’s COVID-19 wave than during the financial crisis.

Still, as many as 12% of workers at companies with retirement matching policies don’t take advantage.

Get in touch with your employer to learn whether your company offers matching – and if it does, be sure to maximize your contributions to get the full benefit.

7. Give Acorns a chance.

Acorns is a digital banking service that makes it easy to invest.

The company offers savings and checking accounts (including accounts for children) that round up purchases and invest the spare change.

With more than 250,000 users globally, Acorns promises to make investing accessible to everyone starting at just $1 monthly.

Visit the Acorns website to see for yourself.

6. For education savings, try Upromise.

Upromise is a similar service designed to help families save for college.

The company offers savings plans, rewards on online shopping and eating out, and even a Mastercard that rewards cardholders for linking to a 529.

Services like Acorns and Upromise recognize that staying committed to a long-term goal can be tough – so they allow users to break the task into small, everyday steps.

Check out Upromise here.

5. Keep track of banking sign-on bonuses.

According to EveryBankBonus, more than 698 banks offer sign-on bonuses for users who create a new, qualifying account.

The competition for banking customers is steep – and there’s no reason that you shouldn’t take advantage.

Consider using a site like EveryBankBonus to keep track of different banks’ offers and requirements.

4. Earn credit card sign-on bonuses.

Credit card sign-on bonuses are another excellent source of “easy money.”

Often, cards will offer cash back or points toward travel in exchange for signing up and spending a certain amount within an introductory time frame.

For example, the Chase Sapphire Preferred Card offers 60,000 points toward travel in exchange for spending $4,000 in the first three months of holding the card.

Check out this list of the best credit card sign-on bonuses from U.S. News & World Report to learn more.

3. Seek out cash-back credit cards.

Other credit cards are noteworthy for their offers to deliver cash back.

For example, the Chase Freedom Flex credit card offers 5% cash back on grocery store purchases and purchases from bonus categories that change each quarter.

Consider timing big purchases on these kinds of cards during the quarter in which you can earn the most for your purchase.

2. Collect bond interest.

Bonds have long been heralded as one of the safest havens for your income.

But with interest rates near zero, it’s time to branch out beyond the U.S. Treasury.

Consider investing in corporate bonds to earn returns on par with some stocks’ returns. Click here to learn more.

1. Get rich with dividends.

No list of the best “easy money” strategies would be complete without Chief Income Strategist Marc Lichtenfeld’s favorite income generators, dividends.

By investing in dividend-paying companies, you secure a lasting and growing income stream for years to come – all with little maintenance on your part.

And thanks to the power of compounding and dividend reinvestment, your easy money will grow to be many times your initial stake.

Don’t miss out on the most powerful route to easy money. Reevaluate your portfolio and look for opportunities to add dividend payers today.

These 10 top “easy money” strategies can help you generate extra income in the year ahead.

Whether you are rounding up purchases to finance your child’s college education, earning points toward a post-COVID-19 getaway or building a retirement income plan you can rely on, you’ll thank yourself later.

Good investing,

Mable

P.S. Have you ever used these strategies to claim “free money” or used other techniques to earn rewards without having to work for them? Let us know in the comments!

The post 10 Ways to Claim “Free Money” appeared first on Wealthy Retirement.

The stockings are hung by the chimney with care…

And here Uncle Sam comes, eager for his share.

For many of us, the end of the year is a cue to rebalance our portfolios and protect our wealth against the next year’s taxes.

In an uncertain environment where many experts anticipate rising taxes, particularly on the wealthy, this is especially important.

Luckily, Chief Income Strategist Marc Lichtenfeld has your back.

Marc knows that building wealth is only half the battle…

So in this week’s episode of his popular YouTube series State of the Market, he explains all of the best year-end tax moves you can make now to protect your wealth down the road.

Marc covers everything from tax-loss harvesting to year-end retirement account contributions and how to take advantage of special 2020 provisions for required minimum distributions.

He’ll also answer common questions like which types of accounts are best for holding bonds and master limited partnerships.

Now is the perfect time to put some of these tax savings tips into action. With just a few simple moves as 2020 draws to a close, you can prevent the Grinch from swiping your holiday cheer come April.

>>Watch Marc’s newest episode now.<<

Good investing,

Mable

P.S. Got more general tax-related questions? Check out this piece by Marc or leave them in the comments below!

The post Act Now for Lower Taxes appeared first on Wealthy Retirement.

It’s time we talked about the “B” word…

Bond.

These investment vehicles have a stodgy reputation.

But day trading detractors can laugh all they want…

In the meantime, corporate bondholders can collect legally guaranteed yields that often beat out blue chip stocks.

Consider this… Chief Income Strategist Marc Lichtenfeld has never lost money on a bond.

He has also never recommended a bond that has lost money.

So bonds may not get the glory – but they almost always win.

That’s why they’re a critical part of any income investor’s portfolio.

And in this week’s episode of the trailblazing YouTube series State of the Market, Marc shows you exactly how to add these steady coasters to your retirement plan.

A Bond That Cannot Be Broken

The reason bonds – specifically corporate bonds – have such a high win ratio is because they don’t function the same way that stocks do.

When you buy a stock, you become part owner in a company, taking on its successes and its failures…

But when you buy a corporate bond, Marc likes to say that you are more of a “backer.”

All publicly traded companies carry debt to expand their businesses, and, as a bondholder, you make a loan to repay that debt.

If the company’s stock price goes down, no problem…

As long as the company doesn’t go completely bankrupt, your principal will be returned to you.

Moreover, if you buy in below par, your bonds have the ability to appreciate in price (generate capital gains) – in addition to paying you interest along the way.

Which means, in addition to providing additional security, bonds produce profits two different ways.

Here’s how…

How to Use Bonds to Your Advantage

All bonds are issued in increments of $1,000, called “par.”

(That $1,000 is called “$100” in “bond speak.”) You receive your $1,000 back no matter what happens to the price of the bond.

That means you can buy a bond at a premium – for example, $1,020 – but you will still receive $1,000 at the bond’s end date, called its maturity.

You can also buy a bond at a discount…

And because you will still receive $1,000 at maturity, you will profit the difference between your purchase price and par (your capital gains) plus all of the interest that you earned in the meantime.

And just like with a consistent dividend payer, those interest payments add up…

(Click here to watch Marc’s latest video and see just how much.)

Granted, this assumes that you are willing to hold each bond to maturity – which is Marc’s recommendation for all bond purchases.

Nonetheless, sometimes there are special circumstances.

So to give yourself the best chance to profit, stick to bonds that are below par, at par or at a slight premium – and do your research to ensure the companies are strong.

To get started, watch Marc’s latest video now.

Good investing,

Mable

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