Nothing in life is guaranteed. Be careful with your hard-earned money and invest in high yielding investments with growth potential. Buying dividend stocks with a payout ratio under 60% may prove to be a profitable way to grow your portfolio.
Investing in yield is a great way to beat inflation and invest in the future. I’m writing this on the eve of Mother’s Day. I believe that we are all investing in a certain way in the future. Investing in cash and checking accounts with low yields could potentially prove to be the worst investment you could make. Instead, invest in stocks that produce income and pay you dividends. Your job as a parent is to prepare your children to take over the world. And as a Mother, that should be your focus, not teaching them how to go out and collect pennies. A little bit of money goes a long way.
Where to Find Quality Dividend Stocks
Here are some of my personal investment ideas.
Provident Financial (LSE: PFG)
Provident Financial is a UK-based consumer lender. It’s in the business of lending money to people who are in difficulty in paying off loans or mortgages. If you want to invest in British business that’s more reliable than Amazon and BHP Billiton, then invest in Provident Financial.
Provident Financial has a dividend yield of 8.17% as I write this article. It has a payout ratio of 55.9%.
I suggest that every woman should invest in Provident Financial and other high dividend stocks. Some things are guaranteed: death, taxes and Provident Financial giving you a nice dividend payment.
My recommendation: Buy shares in Provident Financial for the dividend of £1.25 a share for a total investment of £800. You will get 100 shares for £800 or 2.58% of the current market value of the company.
Provident Financial’s stock has a solid P/E of 6.57. This may seem expensive but I believe it’s a great company and I’m going to make this investment one day when I have a secure income.
Real Estate Investing
Like I said earlier, the highest yields in this article come from real estate investment trusts (REITs). Real estate investment trusts are companies that own real estate. They have different characteristics depending on the sector they invest in. The two main types of REITs in the UK are listed on the London Stock Exchange: property investment trusts and real estate investment trusts.
Real estate investment trusts have a higher yield than the stocks above. They also have an advantage. Most of the companies listed on the London Stock Exchange provide the dividend for real estate investment trusts. But sometimes, these companies offer different dividends. Sometimes, it’s up to you to determine which dividend pays you the highest dividend.
With a lot of options to choose from, investing in real estate can be challenging. Investors need to do their research and check whether the properties that you are investing in are worth investing in.
I recommend real estate investment trusts or using a real estate investing program to ensure you’re not hoodwinked by the technicalities, jargon, etc.