Friday 5 April VPC Specialty Lending Investments PLC

GM re capital return via B share scheme

The blog portfolio earned £3,139.00 in the first quarter.

The first estimate for the second quarter is a total of £5,120.00.

This years target is 9k, which if there aren’t any clangers hiding in the portfolio should be exceeded.

Thursday 4 April

Chelverton UK Dividend Trust PLC ex-dividend payment date
CT UK High Income Trust PLC – Class B ex-dividend payment date
Empiric Student Property PLC ex-dividend payment date
European Assets Trust PLC ex-dividend payment date
European Smaller Cos Trust PLC ex-dividend payment date
Finsbury Growth & Income Trust PLC ex-dividend payment date
Grit Real Estate Income Group Ltd ex-dividend payment date
Hammerson PLC ex-dividend payment date
Henderson High Income Trust PLC ex-dividend payment date
Invesco Asia Trust PLC ex-dividend payment date
Life Science REIT PLC ex-dividend payment date
Martin Currie Global Portfolio Trust PLC ex-dividend payment date
Real Estate Investors PLC ex-dividend payment date
RIT Capital Partners PLC ex-dividend payment date
Schroder Income Growth Fund PLC ex-dividend payment date
Shires Income PLC ex-dividend payment date
US Solar Fund PLC ex-dividend payment date

The Motley Fool

Turning my £20k savings into £20k a year in passive income

By Dr. James Fox

We’d all love to generate passive income, right? Naturally, it’s something of a privilege — the ability to earn money by doing almost nothing at all.

But to generate passive income, we’ve got to have a pot of money to invest. So what if I had £20k in cash, how could I use this to generate a life-changing amount passive income?

The starting point
Firstly, of course, I could look at getting a buy-to-let property and use that money as my deposit. But while it can be lucrative, being a landlord isn’t exactly ‘passive’. I’ve done that and the returns weren’t good enough, plus my money was locked away in property.

I prefer to invest in stocks. And I can do this simply by opening an account with a broker, such as Hargreaves Lansdown — it only takes minutes.
Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

If I invested £20,000 today, even in some of the largest yielding stocks on the FTSE 100, I’d only receive around £1,600 a year in passive income. That’s fine, but it’s clearly not a life-changing sum. I’m looking for £20k a year!

Instead, if I wanted to earn £20,000 a year from my initial investment, I’d need to practice something called compounding, or a compound returns strategy. This is essentially the process of reinvesting my returns every year.

By doing this, I’ll start earning interest on my interest. Thus the growth rate increases over time. So the longer I leave it, the faster it will grow.

Compounding
When it comes to compounding, we normally say that we should be investing in dividend stocks. For example, I could invest in a stock paying a 5% yield — which isn’t guaranteed — and then I would reinvest that dividend when it’s paid year after year.

But in reality, some businesses do the compounding for us. What I mean is, instead of paying a dividend to their shareholders, they continue to invest their profits in their business. Several US-based tech companies have done this, like Amazon and Apple — they’re now trillion-dollar companies.
But it’s easier to practice compounding with dividend stocks. After all, it means I have the power to reinvest my money, not some executive in San Fransisco. Plus, while dividends aren’t guaranteed, they’re more reliable than share price gains.

The power of reinvesting
Well, to generate £20,000 a year, I’m going to need at least £250,000. That’s because I could invest £250k in dividend stocks, like Legal & General with its 8% dividend yield.

So how do I get there? Let’s imagine I’m able to achieve low-double-digit annualised portfolio growth, say 11%. That’s slightly above the FTSE 250‘s average annual growth of 10.6% recorded between 1992 and 2022.

Assuming I can actualise an 11% growth rate, it would take me 23 years to turn my £20k into £250k. That might sound like a long period of time, but it would be worth it.

I can also help my portfolio growth by contributing more funds on a monthly basis. If I added just £200 a month, I could reach £250k in just 17 years.

Run your winners and cut your losses.

My portfolio crystalized losses.

EAT £3,652.00. The dividend yield was 6% based on the share price

and as the price fell the yield fell. A Trust I would buyback in a low

level interest environment.

UKCM £2,432.00 A badly timed trade, sold as other Trusts offered a higher yield.

BMD £1,365.00. A high yielding Trust sold to lower the overall portfolio risk/reward.

If u have made good profits from your investments and don’t want to

lose them, a dividend re-investment scheme is one way of preserving wealth.

Better if u can add oxygen to the fire by investing regulary.

If u are starting with little capital, below is how I built my share portfolio by buying and holding, taking profits and re-investing into new positions whilst always re-investing the dividends.

I have now moved on to a high dividend strategy as I’ve already achieved

my plan for my own portfolio.

I no longer hold any of the above but would buy back selected Trusts the

next time the market crashes.

Can I simply just say what a comfort to discover an individual who truly knows what they’re talking about on the net.
You certainly realize how to bring a problem to light
and make it important. More and more people have to look at this and understand this side of your story.

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Best to DYOR but as always timing then time in is more important

than just time in. The further the Trust is trading from a recent low

the higher the risk of the trade.

Why lifestyling could be your worst decision if u want a comfortable retirement.