Investing for income has gained popularity in recent years, especially among retirement planners and risk-averse investors. Income investing involves putting money into assets like bonds, dividend-paying stocks, and real estate investment trusts (REITs) to generate income. This article will examine the advantages and disadvantages of an income portfolio to help investors determine if income investing is the right choice for them.
What Is Income Investing?
Income investing is an investment strategy focused on generating a regular income flow from investments. The main goal is to produce consistent cash flow from income assets like bonds, dividend-paying stocks, and REITs. This strategy is considered safer as it prioritizes stable, predictable returns over high growth potential.
Growth vs. Income Investing
When it comes to investment strategies, investors often have to choose between income and growth investing. Growth investing focuses on buying stocks expected to grow rapidly, even if they don’t pay high dividends. On the other hand, income investing aims to create a steady income stream through dividends, interest payments, and other sources.
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