Want To Earn Income? Consider These Investment Types

There are different reasons for investing and just as investors have their reasons for choosing growth stocks, the investors who opt for dividend income also have their reasons for doing so

Imagine a lady – let’s call her Ada, who resigned from her investment banking job to start a service-based business in Lagos. She had managed to grow her clientele base and even though jobs didn’t come as often as she would have loved, she proud of the pace of her growth.

After a year of working for herself, she decides to invest a good amount of her funds so as to secure her future while also controlling her spending and opts for long term stocks. However, in barely a year, she is forced to sell off some of her investments to make ends meet. What do you think went wrong?

For one, running a business takes you away from the protective umbrella of a salary. This is why many small business owners run their small businesses as side gigs while still in an employment that guarantees a fixed income.

By taking the jump, especially in a service-based business like hers, there is very little you can guarantee. Unless the business is doing well enough to pay you a salary, trying to tie down your funds in anticipation for future income is a recipe for disaster.

Yet, this is just one reason why dividend income on your investments is important.

There are different reasons for investing and just as investors have their reasons for choosing growth stocks, the investors who opt for dividend income also have their reasons for doing so.

In a bid to not keep knocking on the wrong door, it is important to ensure that you invest in the securities that provide you with the benefits you seek. If you want to build a good income investing portfolio, here are the investment types to consider:

Dividend Stocks

The first kind of security to consider for the income-seeking investor is the dividend paying stock. These are stocks of companies that basically pay good dividends and they include both common stocks and preferred stocks.

As opposed to reinvesting their profits, they share a good amount of their profits with investors periodically.

Your job as an income investor investing in dividend stocks is to find the companies that have high (and relatively consistent) dividend payout ratios.

When you click on any stock on the Yochaa App, you will find all the dividend information required about the company at a glance.

Real Estate

Just like stocks, there are two broad reasons people invest in real estate. The first is for their real estate assets to grow in value to be sold for significantly higher rates later in future.

The other reason is so they can earn dividends in terms of rent consistently. If you are an income investor, the latter option is your best bet. You can own a rental property outright or invest in them by way of Real estate investment trusts or mutual funds.

A solid dividend income-seeking investment portfolio has real estate investments because these investments are tangible. Interestingly, they don’t always have to cost so much.

While there are a few other investments to try your hands on for dividend income, these ones are pretty straightforward and depending on how you structure them, you could have money coming into your account periodically over a period of time.

Written by Lawretta Egba.