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5 Diversified Vanguard Funds Paying 4% or More

Consider these income holdings for your portfolio today

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Vanguard Global ex-U.S. Real Estate ETF (VNQI)
Dividend Yield (12-month): 5.2%
Expenses: 0.18%

Vanguard’s highest-yielding fund at the moment is also, unfortunately, one of its least impressive.

The Vanguard Global ex-U.S. Real Estate ETF (VNQI) is an internationally focused real estate fund that invests in REITs across a number of developed and emerging-market countries. VNQI dedicates nearly a quarter of its holdings to Japanese real estate equities, another 13% to Hong Kong, nearly 8% to China and almost 6% to Singapore, giving the fund a heavily Asian feel.

But the “ex-U.S.” part of its name is perhaps the most important aspect of VNQI right now.

The Problem With Global Real Estate? The Rest of the Globe

VNQI-Global-Problems

You’ll see above that VNQI sits in a tight group of international real estate funds since inception in late 2010. You’ll also note the outlier – the SPDR Dow Jones Global Real Estate ETF (RWO). Many so-called “global” funds actually hold a significant share of U.S.-based assets, and RWO is no exception; 63% of its holdings are American. But wherever you see “ex-U.S.,” you’ll see far more muted action.

Why the underperformance? It’s really a smattering of issues, from fears of a bubble in China to the struggling economies of developed-market nations. Regardless, it likely will take a broad global economic pick-up to get VNQI into an extended uptrend – until then, expect the peaks and valleys that we’ve seen for the past couple of years, with income helping to pad the lean times.

4% is a Start, But Secure 8% Yields are Achievable

These funds are a good start – but as you know, 4% yields probably aren’t enough to let you retire on dividends alone.

That’s because you need about 8% in annual returns to get to where you want to be.

For many high-yield ETFs that waver depending on the market environment, that’s a tall task. But my favorite stock can get you that – in cold, hard cash alone!

Let’s say you have a half-million dollars invested for retirement. Even with interest rates ticking higher, bonds will still net you, what, $15,000 every year? Even with Social Security tacked on, that’s not a comfortable retirement.

Thanks to medical advances, you and I are going to live much longer lives – but that means our money has to work harder, and longer, for us. Realistically, we need to be making about $40,000 annually on every $500,000 invested. That’s about 8%, which is more than the market returns on average.

REIT-Dividend-Growing-Chart

That’s why I’ve set my sights on a particular dividend stock right now that not only yields 8.5% right now, but also raises its dividend each and every quarter! So forget 8% in annual returns – if you also add in the projected capital gains on this sure-fire pick, you can expect a total return 17% between dividends and capital gains every single year!

I specialize in uncovering contrarian 8%+ income opportunities like my ever-rising dividend pick. Click here and I’ll explain more about my strategy and my favorite stocks and funds to buy for a secure retirement on just $500,000.


Article printed from InvestorPlace Media, http://investorplace.com/2017/01/5-diversified-vanguard-funds-paying-4-or-more/.

©2017 InvestorPlace Media, LLC