Earn Steady Retirement Income with Dividend Stocks

Pure income approach

This strategy uses a diversified portfolio of bonds and dividend-paying stocks as a supplement to Social Security or relies on dividend payouts as the sole source of income. A 2% average annual dividend yield on a $5 million stock portfolio, for instance, would generate a pre-tax amount of $100,000 a year. There’s no special dividend stocks to buy here: The S&P 500 typically generates around 2% in dividend income by itself.