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Dividend stocks are in focus as investors look to funnel capital into a euphoric market after the first rate cut. Plenty of successful dividend investing stories show that picking dividend-paying stocks prudently can help you generate a reliable income stream.
About three years ago, a dividend investor on r/Dividends shared his detailed income report, saying he earned $13,000 per year. The Redditor’s initial investment was around $330,000, which reached nearly $474,000 in about seven years of his investing journey.
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Asked whether he uses DRIP investing strategies, the investor said:
"I don’t drip – I prefer to earn dividends and reinvest when I see a good opportunity. Same with rebalancing. If a stock is very overvalued and I spot a good cheap one, I might divert funds."
There were 73 stocks in this portfolio. To give you a taste of what kind of stocks generated the most income for this investor, we chose 14 high-yield dividend stocks with the biggest contributions to the overall annual income of the investor, based on the portfolio screenshots he shared publicly in his Reddit post.
AbbVie
With a current dividend yield of 3.2%, AbbVie Inc. (NYSE:ABBV) was one of the important dividend stocks in the portfolio of the Redditor who makes $13,000 per year. The screenshots shared by the investor showed the portfolio had 80 shares of the company. Over the past year, AbbVie shares have gained about 25%.
Franklin Resources
Financial services company Franklin Resources Inc. (NYSE:BEN) was among the highest-yielding dividend stocks in the $13,000 income portfolio. The stock yields about 5.9% and the company has raised its payouts without a break for over four decades. The Redditor owned 180 shares of the company. However, over the past five years, BEN shares have been down about 27%.
Cardinal Health
With more than 35 consecutive years of dividend increases, Cardinal Health Inc. (NYSE:CAH) is among the safest dividend stocks. The Redditor owned about 95 shares of the company.
Caterpillar
The Redditor earning about $13,000 in annual dividend income owned 30 shares of Caterpillar Inc. (NYSE:CAT) about three years ago when he shared his portfolio details. Caterpillar has increased its payouts for 28 consecutive years.
IBM
With a contribution of more than $1,000 in dividend income, IBM Common Stock (NYSE:IBM) was a prominent stock in the $13,000 dividend income portfolio of the Redditor shared three years ago. The investor owned 50 shares of the company.
Coca-Cola
Coca-Cola Co (NYSE:KO) is another strong dividend growth stock in the portfolio of the Redditor, who earns $13,000 per year. The investor owns 150 shares of the company. As of today, Coca-Cola Co (NYSE:KO) has raised its dividend by over six decades and yields 2.7%.
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Consumer foods company General Mills Inc. (NYSE:GIS) has a dividend yield of over 3.2% and the stock is up 14% in the past year. The Redditor at the time of sharing his portfolio had 110 shares of General Mills Inc. (NYSE:GIS).
Lazard
Financial advisory and asset management company Lazard Inc. (NYSE:LAZ) was an interesting name in the portfolio of the Redditor. The stock earns $13,000 in dividends per year and has a dividend yield of about 3.96%. The investor reported owning 150 shares of the company.
3M
Industrial conglomerate 3M Co (NYSE:MMM) is a strong dividend-paying stock in the portfolio of the Redditor generating $13,000 in income per year. The company has raised its dividends for 64 consecutive years. 3M Co (NYSE:MMM) is up 64% so far this year. The investor at the time said 3M was his biggest position.
Realty Income
Realty Income Corp. (NYSE:O) has become synonymous with monthly dividend income, thanks to its juicy yield (over 5%) and almost guaranteed dividend hikes. The company has upped its payouts for three decades in a row now. The Redditor had 100 shares of the REIT in his portfolio.
Altria Group
When he shared his income report three years ago, the Redditor had 140 shares of Altria Group Inc. (NYSE:MO) in his portfolio. As of today, the tobacco products company has raised its payouts for 59 straight years. Altria Group Inc. (NYSE:MO) is swiftly transitioning to smoke-free products amid a decline in traditional smoking worldwide. The stock is up 22% so far this year.
AT&T
With a dividend yield of about 5.2%, AT&T Inc. (NYSE:T) is an important dividend stock. The Redditor’s portfolio included the telecom company, which earned $13,000 per year in dividends. The investor owned about 190 shares of the telecom company.
T Rowe Price Group
The Redditor had owned 60 shares of the investment management and financial services company T Rowe Price Group Inc. (NASDAQ:TROW), which has a dividend yield of about 4.6% today.
ExxonMobil
Oil giant Exxon Mobil Corp. (NYSE:XOM) was one of the biggest contributors to the Redditor's portfolio of dividend income. The investor had 161 XOM shares in his portfolio. Exxon Mobil Corp. (NYSE:XOM) currently yields about 3.2%.
Interest Rates Are Falling, But These Yields Aren't Going Anywhere
Lower interest rates mean some investments won't yield what they did in months past, but you don't have to lose those gains. Certain private market real estate investments are giving retail investors the opportunity to capitalize on these high-yield opportunities and Benzinga has identified some of the most attractive options for you to consider.
Arrived Homes, the Jeff Bezos-backed investment platform, offers a Private Credit Fund. This fund provides access to a pool of short-term loans backed by residential real estate with a target of 7% to 9% net annual yield paid to investors monthly. The best part? Unlike other private credit funds, this one has a minimum investment of only $100.
Wondering if your investments can get you to a $5,000,000 nest egg? Speak to a financial advisor today. SmartAsset’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 to decide which one is right for you.