How I’m making my life easier for 2023 with these passive income ideas – Yahoo Eurosport UK
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December is one of my favourite months of the year. However, it’s followed by January, which is my least favourite month. As the start of the year hits me hard, I like to distract myself with some intensive research and some stock picking. I’m always looking for ways to make my life easier. Part of this relates to making passive income. If I can build up a second form of income via investing then it can help me enjoy 2023 (and years beyond that) a lot more!
Hitting the ground running
I don’t have to wait for long to start picking up some income. The easiest and quickest way is for me to buy some more dividend stocks, before they go past the ex-dividend date. This is the last date when I need to be a listed shareholder in order to receive the upcoming payment.
Within the next month, there are ex-dividend dates for some well-known names including SSE, Imperial Brands and BT Group.
Though I don’t have the free cash to buy these stocks now, I’ll still have ample opportunity in Q1 to add different income shares to my portfolio.
A risk is that I might miss the ex-dividend date of a stock I want to buy, in which case my income potential stalls until the next declared payment.
Thinking for the next decade
What if I want a strategy to help me in 2023 but also for years beyond that? I like to tweak the above by making one simple difference. Instead of taking the dividend payments and spending them, I’m going to use the money to buy more shares.
This helps me next year as I’m setting aside money and growing my investment pot. But it also helps me for the long term as the reinvestment of the dividends gives me a larger future portfolio.
For example, if I invest £300 a month for the next decade but take out the dividends and spend it, I’ll have a pot worth £36k at the end. I’m assuming for the moment that there’s no capital gain or loss on the share price. Now, if I leave the dividends (with an average yield of 4%) to compound, my pot would be worth £44.6k.
Passive income from growth stocks
My final idea is to make use of trimming profits from growth stocks. Such companies haven’t …….