VALUE: After Hours (S08 E05): Why Income Investing Matters: Dividend & Fixed-Income Strategies for Retirement Stability

During their recent episode, Taylor, Carlisle, and Jay D. Hatfield discussed Why Income Investing Matters: Dividend & Fixed-Income Strategies for Retirement Stability. Here’s an excerpt from the episode:

[Jay] Well, it’s primarily helpful for people who… I would recommend having it even when you’re young, having some. But for older individuals who are looking forward to retirement or in retirement, it can give you a good base load for your portfolio whereby you know a good percentage of your expenses are being covered by the income coming from your portfolio.

And then you could have more growthy or riskier investments in the remainder of your portfolio. Because what you don’t want is like during… We haven’t had one since 22, but during major drawdowns, you don’t want to have to be selling securities and taking losses.

And so, nor do you want to be worried about that, even if it doesn’t happen. And so it can provide a lot of solace. If you have fixed income, that can be a lot less volatile than the rest of your portfolio.

So you can also use it for rebalancing. This is what major pension funds do. So every quarter, they say, oh, well, my fixed income, because equities are down a lot, it rose from 40 to 45.

So we’ll sell 5% fixed income and buy 5% equities. So it can be a great way to buy at the bottom and sell at the top. Force yourself to do that by setting an allocation of fixed income and then rebalancing.

Usually equity income is pretty correlated with the market. So it doesn’t help you that much on that, but true fixed income would.

You can find out more about the VALUE: After Hours Podcast here – VALUE: After Hours Podcast. You can also listen to the podcast on your favorite podcast platforms here:

 Apple Podcasts

 Breaker

 PodBean

 Overcast

 Youtube

 Pocket Casts

 RadioPublic

 Anchor

 Spotify

 Stitcher

 Google Podcasts