this post was submitted on 04 Oct 2024
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I get conflicting information about high dividend ETFs. Some people swear by them, others say they're terrible or at least should be avoided. I'm too ignorant to know why either way :/
By the nature of ETFs, you're definitely going to make less income because your money gets put into an investment pool and returns are proportional. However it makes you less tied to the stock market, which is increasingly tied to a person's ability to retire
Those are my main investments outside of my 401k from work, I was just curious about the high dividend ones but someone else answered what is going on there. Thanks for the info!
Many people in The US who are trying to save for retirement attempt to have fewer dividends since that becomes taxable income. They would prefer just a higher stock value and pay the taxes later when presumably they are retired and in a lower tax bracket. That premise is probably good but you never know how the government is going to change up tax rates in the future.
Thanks for the info!