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Getting Ahead With Stocks That Pay Monthly Dividends

Estimated reading time: 2 mins

If you’re new to the stock market, there are several things to consider when it comes to dividend payouts. Dividends refer to profit distributions made by a corporation that are paid to shareholders via shares in the company. These profit distributions can be paid quarterly, semi-annually, annually, or even monthly. Monthly dividend payouts, in particular, come with several advantages for investors. Read on to learn about the benefits of stocks with monthly dividend payouts.

Steadier, Reliable Income

Though stocks offer a steady stream of income, a monthly distribution means you’ll receive the payout more frequently. This gives the company offering the stock more chances to earn your trust through timely payments. Though quarterly, semi-annual, or annual payments can also be reliable, the frequency of monthly distributions lets you see the consistency from these companies more readily. Regardless of the payment plan that a company’s stock offers, it’s important to invest in stocks that you can depend on to follow through.

Variety of Choices

If you’re interested in purchasing a stock with monthly dividend payments, there are several options to consider. This is especially true when it comes to exchange-traded funds offered by major firms like Vanguard Group and BlackRock, Inc. You can also get monthly payouts via smaller firms such as Global X Funds. Here are some stocks to consider that offer monthly dividend payouts:

  • Realty Income Corporation.
  • LTC Properties.
  • Sabine Royalty Trust.
  • Main Street Capital Corporation.
  • Apple Hospitality REIT.
  • Stag Industrial.
  • Vermilion Energy.

Note that most monthly dividend payers are in the commercial or real estate industry, as those businesses tend to operate on monthly payments.

Allows for More Reinvesting

When you receive monthly dividend payments, you gain the option of dividend reinvestment. This means you can use the dividend funds you received to purchase more shares of stock. In some cases, you may be able to automatically reinvest your dividends through stock trading sites as an added convenience.

Higher Yields

Monthly dividends tend to mean higher yields for investors. When you invest in high-dividend-yield stocks, you get a steady source of income you can rely on. They also come with desirable long-term returns. Lower-yield stocks, in contrast, are more apt to be reinvested in the stock market for money.

Easier To Afford Monthly Expenses

Monthly dividends are paid out once per month, meaning they occur with the same frequency as most personal expense payments, such as rent or utility bills. Having a monthly payout lets you balance your day-to-day finances more easily. Whereas you’d have to ration out quarterly, semi-annual, or annual payments, a monthly dividend payout enables you to distribute your funds right away.

Now that you understand what monthly dividend payments are and the benefits they provide, you’re better equipped to determine if this investment is worthwhile for you. Depending on your finances, a monthly dividend payout may be the most beneficial as an investor. If this is the case, search for quality stocks that make payments with this frequency.

Image via Flickr by mikecohen1872

 

About the author /


Simon is a creative and passionate business leader dedicated to having fun in the pursuit of high performance and personal development. He is co-founder of Applied Change, a Business Change consultancy based in the UK. Simon is also an Ambassador for Gloucestershire business. Simon is an Associate Member of the Chartered Institute of Professional Development.

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