If you’re a Motley Fool reader, then you’re likely already familiar with the method of investing in dividend stocks. Even if you have absolutely no savings, you can still start bringing in passive income by choosing these stocks to buy. Each and every quarter, or even every month, dividend stocks pay out passive income like a paycheque. And that payment is fixed, usually only growing once per year, so it’s income you can look forward to rather than swinging with the market.
Now, if you’re not a regular Motley Fool reader, this may be new to you. And furthermore, you may not even have savings to start with. But that’s all right! You can simply start the next time you have any cash set aside. And that’s honestly the easy part. Whether it’s the few bucks you spend on lunch or the shirt you decide not to buy, all that cash can be used towards investments. Then, at the end of the year, you’ll likely have enough cash to buy several of those shirts or take your partner to a fancy dinner instead!
Let’s see how you might bring in solid cash for the rest of your life with little to no savings starting today.
First, how much can you invest?
Investing isn’t all about making money. It’s about being smart with your money. So, don’t put off debt or forego paying bills so that you can invest. Instead, do as I suggested and simply cut the unnecessary items from your life. Then, whatever you can afford, you should put towards investments — not once, but every single month. Even every paycheque!
By doing this, coupled with automated payments, you can therefore invest worry free. You’ll know your bills are paid, and you’ll also be investing without the worry of forgetting. And let’s say you can afford to put just 10% of your paycheque aside each month and you make $50,000 per year. That’s $500 a month and $6,000 per year! That’s a significant investment! Especially when it comes to taking in a dividend while you do it.
Second, what’s your goal?
Don’t just go forth and start investing without a goal. Is this for retirement? Paying off student loans? Buying a house? Will you need it in decades or in years? That’s all something to consider, because it will then depend on where you invest the cash. Is it for retirement? Put it in a Registered Retirement Savings Plan (RRSP). Student loans? A Tax-Free Savings Account (TFSA) is probably better. You can always change where your investment goes later on, but having a goal will keep you on track when you actually see your debt go down or your retirement fund go up!
Once you have that goal in mind, it’s time to find the dividend stock for you. Right now, I like NorthWest Healthcare Property Units REIT (TSX:NWH.UN). This healthcare REIT offers a dividend yield of 6.02% as of writing. It’s in the healthcare sector, where it’s remained a steady source of income thanks to being an essential service. Furthermore, it’s on the growth path. The company has been acquiring further properties around the world, creating a diverse range of healthcare properties to consider.
Right now, if a Motley Fool investor chose this dividend stock, a $6,000 investment would bring in dividends of $365 per year. That’s a dollar a day, or about $30 per month!