I know this is going to ruffle some fur, but Iāve been noticing a slow shift from aggressive income investing toward growth-focused strategies. So like everyone else who wasnāt asked for their opinion, Iāve decided to share mine anyway. Have you ever gone out to eat and instead of scanning the menu for something youād enjoy, you look at the prices first? Itās like deciding which price you want to pay, then figuring out if the food that comes with it is worth the value. Thatās exactly how I see income investing. Most folks (including anyone who feels the need to defend themselves from this post) hunt for dividend yields and distribution rates long before they research the actual company or ETF. They lock onto a particular annual dollar amount or percentage yield before even considering risk tolerance, NAV erosion, or sustainability. The thought process usually goes something like: āI want $500 in yearly income, but I only have $1,000 to invest. Let me find something that pays 50%.ā You can swap the numbers however you like, but the narrative stays the same. And thatās where my approach diverges from most income investors. Like many of you on Blossom, Iām still in the accumulation phase. Iām trying to build the biggest nest egg possible before I rely on it to fund my lifestyle. Dividends are secondary while I focus on quality companies that will not only grow their business but will still be standing in 20 years. I look at fundamentals. I compare the company to its peers. I learn a little about the industry and economic trends. Then I make what I consider an informed investment. If the stock happens to pay a dividend, great. If not, thatās fine tooā¦because Iām accumulating wealth in my portfolio, not drawing from it. If I were chasing yields, Iād miss out on great companies like $INTC, $AMD, $HOOD and instead be chasing leveraged ETFs with unknown levels of risk like $MSTY. Donāt get me wrong, if youāre drawing funds from your portfolio, income investing is a solid way to preserve capital. But if youāre still accumulating wealth, growth should be your focus. So instead of ordering food by price, maybe order something that actually suits your appetite. Iām thinking a medium-rare NY strip with a Caesar salad, baked potato, and steamed vegetables. Meanwhile, you can hunt the menu for anything priced at $18 or below. I hope you enjoy your meal. =^.^= š” Also this is a small pet peeve of mine. Your CC ETFs pay out distributionsā¦ not dividends. Individual stocks pay dividends. Some ETFs pay dividends when the underlying assets pay the dividends and the money flows through to the share owners. Income derived from option premiums along with any return of capital is called a distribution. š”
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74 Comments
Marc Beavis@marcb Ā· 6mo
You make a lot of great points in your post @takoyaro. Very well thought out and logical. I will admit, when I dine out I usually scan the prices first. I don't necessarily choose the cheaper options, but I guess I always try and assess the value I'll get for the price I'm paying. Like stocks, I suppose. Sadly, it doesn't seem to matter what I end up ordering these days I often feel the cost outweighs the value, but that's just where we are in 2026. Thanks for a really good post.
Paul @mrwhite007 Ā· 6mo
I like my steak to be so rare that the cow is still moo-ing when the waiter/waitress puts the dish in front of me! šš»šš»
Kyle T@kyletfreedom58 Ā· 6mo
Completely agree! Many dive right in (usually for the high yield) without understanding what they're buying, and those are the angry, "flaming" posts you see trashing CC ETFs as people feel misled, and betrayed by the companies. Personally, every time I see someone complain about "NAV erosion" I know that they don't understand what a single-stock CC ETF is or how it works. They just ordered the lobster and freaked out when they bit down into the shell since they didn't know they needed to crack it open first š±š¤·
Rabid Money Badger @riggs Ā· 6moEdited
The distribution / dividend thing bothers me as well. In my yield chasing days thatās pretty much how it went. I looked at yield first then decided if it was āworth itā How it usually went for me was I have $100 to invest today where can I put it to bring me the largest cash flow as soon as possible. Ex. $100 in $BANK would give me 10 shares 10x0.12=1.20 $1.20 per month. $100 in $SIXY would give me 3 shares rounded down 3x0.21=0.63 semi monthly 0.63x2=1.26 $1.26 per month lol Iād choose SIXY lol. But that was just yield chasing no other reason than to get more cash flow.
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