Earning a second income doesn’t always mean sitting up until midnight working on a side hustle. Sure, putting in the time and effort is one way to earn extra cash. But another way is by saving and investing.
With little effort, most people could save £7 of spare change each day. It wouldn’t be difficult — but it would add up to a decent £200 a month. Putting that money to work could go a long way.
But where to put it? A savings account is secure but barely beats inflation and few index-tracking funds return over 5%. What about a carefully picked portfolio of high-yield ? Now there’s an interesting option. Aim for a yield of 7% The average yield on the is around 3.
6%. This is brought down by many stocks that pay less than 1%. But many pay 7%, or above.
The top payers change frequently but some seem to always be near the top 10. These are the stocks to aim for. But to maintain a yield of 7% requires careful planning.
The portfolio will need a mix of reliable stocks with yields that are likely to remain between 6% and 8% for the long term. This is impossible to guarantee but there are ways to improve the chances. Checking a stock’s track record Take for example.
It has a 7% yield today but look back 10 years. The yield is all over the place, spending much of the past decade below 5%. also looks good with a 6.
3% yield but before 2022, it was mostly below 5%. looks solid with a yield above 6% since 2011, occasionally going as high as 9%. But wait a second – the share.