imagine waking up to a lie for your money works for you where the clink of coins in your pocket is replaced by The Sweet Sound of dividends hitting your account picture a world where Financial Freedom isn't just an idea but a tangible reality this is not some far-off dream it's within reach just like retiring comfortably means different things to different people there are countless Financial scenarios to consider some people might explore reverse mortgages selling off possessions or moving to an affordable place but there's another option that often gets overlooked living on investment dividends something that can help you earn twenty nine hundred dollars a month stick around because we're going to share three fast ways to get to that goal so what's this secret sauce for determining your ideal investment amount it all comes down to your desired lifestyle and of course the numbers sure the average guy spends around sixty seven thousand dollars a year but that might not be the right Benchmark for you you can adjust based on your specific needs aspirations and level of comfort now let's add a touch of intrigue picture this a life where your Investments generate a consistent income stream allowing you to enjoy the fruits of your labor without touching your principle it's like having a secret money tree that keeps growing and providing for you with passive dividends the possibilities become enticing remember this journey is about finding the balance that aligns with your dreams so take a moment to picture your future visualize the kind of life you want to lead and then let the numbers guide you towards the investment amount that'll make dividends your ticket to Financial Freedom for this video we'll show you and John on how to hit the target of twenty nine hundred dollars a month or thirty five thousand dollars a year before that let's understand dividend and how it works imagine you're a part owner of a company by owning some of its stock when that company makes a profit they have choices on what to do with it they can use the profit to grow the company or give it to their owners in the case of publicly traded companies the owners are the shareholders like John if a company decides to distribute some of its profit to shareholders it's called dividends as a shareholder John would receive a portion of that profit based on how many shares he owns dividends can be given as cash either through a digital deposit or a check or they can be reinvested in more shares of the company's stock companies have different schedules for paying dividends but many do it every three months now let's talk about dividend yield this is a way to measure how much you're earning from dividends compare compared to the price of the stock it can vary from company to company and even change for the same company over time generally more established companies offer higher dividend yields than smaller newer ones now to calculate dividend yield it's quite simple you take the annual dividends per share and divide it by the price per share for example if John's stock is priced at 100 per share and he receives ten dollars in dividends each year is dividend yield would be 10 percent understanding dividend yield helps John evaluate his investment he can compare different stock prices and make smart decisions based on his goals and how much risk he's willing to take by investing in dividend-paying stocks John has the potential to earn regular income without needing to sell his shares this means he can enjoy a steady stream of money while still keeping his investment intact which is pretty fantastic so for John and anyone else interested in earning passive income dividends can be a compelling strategy to consider it's a way to grow your wealth over time and live off the income generated by your Investments now let's take a dive into three simple strategies that can help John achieve his goal of earning twenty nine hundred dollars per month or thirty five thousand dollars per year through dividends strategy number one covered call ETFs one of the quickest paths to living off dividends is by investing in covered call ETFs these unique funds offer investors the opportunity to earn income from both stock appreciation and dividend payments how does it work well the ETF invests in stocks and also writes call options on those same stocks to generate additional income call options give the buyer the rights but not the obligation to buy a stock at a specific price within a certain time frame so when the ETF sells call options on the stocks in its portfolio it receives premium income that is paid out as dividends moreover if the stock price rises above the call options strike price the ETF May realize capital gains because it'll be required to sell those stocks there are several popular covered call ETFs to consider such as xyld oil K and ewz These funds offer attractive yields often in the double digits which are significantly higher than the yields in many traditional dividend stocks let's take a look at their 12-month trailing yields xlyd has a yield of 11. 83 percent oilk has a yield of 11. 82 percent ewz has a yield of 11.
81 percent the beauty of these ETFs lies in their ability to provide income from both dividends and option premiums resulting in a more stable and reliable stream of passive income however it's essential to understand that these ETFs come with some risks for instance options May expire worthless or the stock prices May decline impacting the overall performance now let's apply this strategy to John's Journey if John aims to earn twenty nine hundred dollars per month which equates to thirty five thousand dollars per year through covered call ETFs we can adjust the figures of accordingly based on the current yield levels John would need an investment ranging from approximately two hundred eighty thousand dollars to three hundred ten thousand dollars that's quite appealing isn't it especially when compared to traditional dividend stocks where you would need around 2 million dollars invested to achieve the same level of income by choosing covered called ETFs John can reach his financial goal of earning thirty five thousand dollars per year or twenty nine hundred dollars per month without needing an excessive investment this strategy offers an opportunity to generate a steady income stream while minimizing the capital required so if John is eager to embark on this path he can explore covered call ETFs as a means to fulfill his dreams of living off dividends and enjoying Financial Independence let's explore another way for John to earn thirty five thousand dollars per year or twenty nine hundred dollars per month through dividends this strategy involves investing in special companies called real estate investment trusts or REITs for short strategy number two high-yield REITs REITs are like teams that invest in real estate properties like malls offices and apartments these teams make money from these properties and share some of it with people who invest in them for John there are some great reads to consider if he wants to earn passive income from dividends these include Two Harbors Investment corporation which has a dividend yield of 20. 3 percent Brandywine Realty Trust with a dividend yield of 19. 9 percent and Orchid Island Capital Incorporated offering a dividend yield of 19.
4 percent these REITs have a track record of providing their investors with a consistent income stream through dividends historically REITs have shown solid performance with an average annual return of 10. 8 percent over the past 20 years this means that investing in REITs can be a smart way for John to potentially grow his wealth while earning a steady income it's important to know that the amount of money you get from REITs can go up and down because it depends on how many people rent the properties and how the economy is doing while REITs can give you more money than regular stocks they can also be risky when the economy is not doing well so how much does John need to invest to earn 35 000 per year from REITs if he expects to get around 10.
