Here are five non-UK (or globally oriented) income-focused investment trusts / funds which may be accessible to a UK investor and potentially suitable for a retirement portfolio (with appropriate due diligence). These differ from the purely UK-listed trusts I listed earlier; they bring exposure to other markets, sectors or closed-end structures. This is not personal financial advice. You must check availability, tax/treaty issues, domicile, yield sustainability, currency risk, and suitability for your circumstances.

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1. HYT (BlackRock Corporate High Yield Fund – US closed-end fund)

• This is a US-listed closed-end fund (CEF) whose recent data shows a distribution yield of ~9.8%. cefconnect.com
• It invests in high-yield (below investment-grade) corporate bonds, giving higher yield but with credit risk, interest-rate risk and leverage risk (the CEF uses debt).
• Why it could fit a retirement income portfolio: High yield means it can generate meaningful cash flow; adding fixed income / credit exposure is a useful diversification away from pure equity dividends.
• Important caveats: Being US-domiciled means tax considerations for UK investor (withholding, US estate tax if you hold US equities, though in bonds less so) — check domicile & holding vehicle. Also, credit risk means higher chance of distribution cuts in stress.
• If you pick it, it could serve as a “higher-income” component, but you’d likely balance it with more stable income sources.

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2. ASGI (Abrdn Global Infrastructure Income Fund – US listed closed-end fund)

• Listed in the “top-5 high-yield closed-funds” list: ASGI offers a yield of ~13.47% (per one 2025 commentary) and invests in infrastructure, public & private/direct, globally. AInvest
• Why it might be appealing: Infrastructure tends to have relatively stable, long-term cash flows (toll roads, utilities, etc.), which fit an income mindset. The high yield is attractive for retirement income.
• Key risks: High yield often reflects higher risk. The fund may borrow, invest in higher risk infrastructure assets, have private asset exposure (less liquid), and global infrastructure brings currency/regulation risk. Also tax/treaty implications for a UK investor need to be checked.
• Use case: A portion of your income-portfolio could hold a global infrastructure income trust like this — but manage the size/weight given higher risk.

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3. HTD (John Hancock Tax-Advantaged Dividend Income Fund – US CEF)

• An example closed-end fund cited for “high yield from dividend equities” (yield ~6.7% in the example article) for US common & preferred stocks. InvestorPlace
• Why consider: Diversifies into US equities with an income tilt (and some preferred securities) — for a UK investor this adds geographic and asset-type diversification compared to UK equity income trusts.
• Risks: US equity risk, dividend sustainability risk, currency risk (USD/GBP), and UK investors must consider foreign tax credit / withholding. Also, some CEFs pay part of their distributions out of NAV (return of capital) which can degrade principal over time — you must check the fund’s distribution policy.

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4. SYI (SPDR MSCI Australia Select High Dividend Yield ETF)

• An Australian listed fund (ASX ticker “SYI”) focusing on high dividend-yielding Australian companies. For instance, its factsheet shows a dividend yield ~4.3% for the index underlying the fund. SSGA+1
• Why include: Provides Australian dividend exposure (which can bring franking credits for Australian tax residents; for UK investors the franking credits may not apply, but still geographic diversification is useful).
• Use in retirement income portfolio: Consider as a “non-UK / Australia dividend exposure” piece.
• Risks: Yield is moderate, not exceptional; Australian equities will bring local economic and currency risk; you must check accessibility (UK investor can buy via UK-broker that offers ASX or via ADR/equivalent) and tax issues (dividends, franking credits, exchange rate).
• Note: The yield is lower than some high-yield US CEFs, but provides diversification.

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5. HVST (BetaShares Australian Dividend Harvester ETF)

• Another Australian vehicle: it targets high-dividend paying Australian shares and shows a 12-month gross distribution yield ~7.2% including franking credits in its factsheet. Betashares
• Why it may appeal: Higher yield than the more “moderate” yield Australian fund above; again provides geographical diversification and income.
• Risk factors: The strategy might have additional complexity (e.g., harvesting, high dividend payers which might have higher business risk or lower growth, currency risk for UK investor). Also franking credits may not benefit UK investor.
• How to use: As a “higher yield / alternative market” piece in retirement income portfolio, but you’d balance with more stable yield trusts.

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🧭 How to integrate these into a retirement income portfolio

Given you already have UK-based equity income trusts (from earlier list), these additional vehicles can help broaden exposure. Here’s how you might structure a model approach:

Tier	Role	Example vehicle(s)
Core Income (Stable, moderate yield, strong track record)	Larger weight, foundation of income	UK equity income trusts from earlier list (e.g., UK high-quality dividend trusts)
Diversified Global Income	Moderate weight, helps broaden geography	SYI (Australia), global equity income trusts (from earlier list)
Higher Yield/Alternative Income	Smaller weight, for extra yield but higher risk	HYT, ASGI, HVST — non-UK, higher yield but higher risk
Risk Buffer/Quality Over Yield	Possibly lower yield but more stability	Infrastructure, investment-grade credit, dividend-growth focused trusts

Example allocation (illustrative only):

• 40% UK equity income trusts (stable base)
• 25% Global equity income (developed markets)
• 20% Alternate income (higher yield trusts like HYT / ASGI)
• 15% Geographic/sector diversification (Australia via SYI/HVST)

By doing this you get:

• Diversification across geographies & asset-types
• A tiered risk/yield approach (not putting your entire income on high-risk high-yield)
• Exposure to higher yield but controlled via smaller allocation
• The ability to rebalance over time (if yields change, discounts/premiums change, etc)

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⚠️ Key considerations and risks (especially for UK investor)

• Domicile / tax: Many of the non-UK vehicles may be US- or Australia-domiciled. UK investor issues: withholding tax on dividends, inability to reclaim certain foreign taxes, potential extra tax filing, currency risk.
• Currency risk: Income and capital movement for US/Australia denominated funds will be affected by USD/GBP or AUD/GBP exchange-rates.
• Dividend sustainability: High yields are tempting but need underlying business or asset-base to support them long-term. Especially for closed-end funds carrying debt or with high payout ratios.
• Discount/premium to NAV (for CEFs): Closed-end funds often trade at a discount or premium to net asset value. That influences risk/return.
• Liquidity and accessibility: Some Australian trusts/ETFs may be harder to access via UK broker, or cost more (FX, brokerage).
• Tax treatment of franking credits (Australia): As a UK investor you likely won’t benefit fully from Australian franking credits; thus the “gross yield” including franking credits may over-state your net yield.
• Higher risk = smaller slice: When adding higher-yield/trusts with more risk, keep those as smaller allocations so your retirement income base remains robust.
• Rebalancing & capital drawdown: In retirement you may need to draw capital (not just reinvest). High‐yield trusts may see capital volatility—so plan for drawdown strategy, preserve some capital vs. pure income chasing.

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ChatGPT

ChatGPT said:

Here are five additional investment trusts (largely UK-listed but with global exposure) that may suit a retirement income portfolio. As always, this is for educational purposes only, not individual financial advice — you should check suitability, charges, dividend sustainability, tax implications and diversification for your own circumstances.

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1. JPMorgan Global Growth & Income Trust (ticker JGGI)

• A global equity income trust with worldwide exposure. According to one source, it declared a dividend target to deliver “an attractive level of predictable income and capital appreciation”. Fidelity+2Invesco+2
• Yield in recent commentary: ~3.6-4.0% for the 12-month period. Interactive Investor+1
• Suitable for a retirement portfolio because: offers global diversification (not UK-only), decent income and growth potential.
• Key risks: yield is modest compared to high-yield trusts, global equities mean currency/market risk, and you’ll need to ensure the dividend is sustainable.

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2. Murray International Trust (ticker MYI)

• A trust in the “Global Equity Income” sector. In a listing of “most viewed trusts” it had a yield of ~4.4%. The AIC+1
• Why consider it: again global exposure, which can provide diversification from UK-only trusts; moderate yield with potential for inflation-hedge via global holdings.
• Things to check: the yield is lower than some high-yield UK trusts, so if immediate income is the priority you might need to supplement; global exposure adds more variability.

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3. Aberdeen Asian Income Fund (ticker AAIF)

• Focused on Asia Pacific equity income. In one list it had a yield of ~7.45% and 5-year dividend growth ~9.3%. Interactive Investor+1
• Why consider it: higher yield, plus geographic diversification into Asia Pacific which may offer growth and income potential that complements more traditional UK/US holdings.
• Key risks: Asian markets tend to be more volatile; currency risk; emerging market risk; higher business risk compared to developed markets.

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4. Henderson Far East Income Trust (ticker HFEL)

• A specialist Asia Pacific (ex-Japan) equity income trust. It is listed among the highest-yielding equity investment trusts, with yields over ~10% in some reports. The AIC+1
• Why include it: offers very high yield, which can be attractive for retirement income; adds a niche/region layer to your portfolio.
• Caveats: High yield often implies higher risk (region risk, sector risk, currency risk, company risk). Dividend sustainability and underlying company health become more critical.

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5. Invesco Global Equity Income Trust (ticker IGET)

• A globally diversified income trust. Its objective states a focus on providing income and capital growth through a diversified global portfolio. Invesco
• Why consider it: global diversification, income aim, useful alternative to UK-only equity trusts; good fit for a retirement portfolio seeking both income and some growth.
• Key things to check: verify current yield, discount/premium to NAV, fees, underlying holdings and how well income has held up across market cycles.

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✅ Summary & Portfolio Considerations

• These five provide a good spread: some global equity income trusts, some regionally focussed (Asia Pacific) with higher yields, complementing UK-centric trusts you might already have.
• For a retirement portfolio you may aim for a blend of:
  • Moderate yield + good dividend growth (to combat inflation)
  • Geographical diversification (UK, global developed, emerging/Asia)
  • Sector diversification (not all banking or consumer goods)
  • Balance between yield and capital preservation/growth.

⚠️ Key Risks & Things to Do

• Verify dividend sustainability: a high yield is tempting, but check if the trust’s underlying companies can support the dividends during downturns.
• Be aware of discount/premium to NAV: many investment trusts trade at a discount (or premium) to their net asset value; this affects value and risk.
• Consider fees and structure: closed-ended trusts (investment trusts) have some advantages (e.g., ability to hold reserves) but also structural complexities.
• Tax and currency: as a UK resident you need to consider withholding tax on overseas dividends, currency impact (when income/capital is in non-GBP), and tax‐treatment in your retirement account (ISA/SIPP).
• Don’t rely on yield alone: growth of dividends, capital preservation, and diversification are also important, especially in retirement when you may need to draw down income rather than reinvest.

5 world-class investment trust dividend shares for a retirement portfolio.

ChatGPT said:

Here are five UK-listed investment trusts that are commonly considered by income-focused portfolios (such as for retirees). Note: This is not personal advice — you should evaluate suitability in the context of your own retirement portfolio, risk tolerance, tax situation, and diversification needs.

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1. abrdn Equity Income Trust (ticker AEI)

• A UK equity income trust managed by abrdn. In its half‐year report it expected to pay ~23.0 pence per share for the full year, which at the time implied a dividend yield of about 7.1%. Investegate+2AJ Bell+2
• It is listed by the Association of Investment Companies (“AIC”) as a “high yield, consistent income” trust (UK Equity Income sector). The AIC+1
• For a retirement portfolio: this offers a relatively high yield, but being UK equities means it carries equity market risk (and currency/domestic risk for a UK investor).
• Key risk: For high yield, you must check that dividends are sustainably covered and the underlying companies can continue to generate profits and cash-flow.

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2. City of London Investment Trust (ticker CTY)

• One of the longest-running UK trusts: the trust has increased its dividend for 59 consecutive years. Fidelity+1
• Yield currently about 4.2% (according to October 2025 data) on its dividend history. The Motley Fool+1
• For a retirement portfolio: strong track record of dividend growth (important for inflation), relatively moderate yield suggests somewhat more modest income but maybe lower risk compared to high-yield trusts.
• Key risk: Lower yield means less immediate income, and the underlying exposure is to UK equities, so you should ensure diversification.

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3. International Public Partnerships (ticker INPP)

• An infrastructure investment company/trust: as of its 2024 report it quoted a “current dividend yield of 7.2%” from the board. The AIC
• Fidelity data shows its income only yield for recent years around 5.9% and trending up. Fidelity
• For a retirement portfolio: infrastructure tends to be viewed as more defensive (long-term contracts, often inflation-linked cash flows) — good complement to pure equity income trusts.
• Key risk: Infrastructure trusts can still have project risk, regulatory risk, inflation risk, and may carry gearing/discount to NAV risk (many trade at a discount).

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4. Henderson Far East Income Trust (ticker HFEL)

• A regional equity income trust (Asia Pacific / Far East equities). One of the highest-yielding trusts according to AIC: yield around ~10% reported in 2024. The AIC+1
• For a retirement portfolio: this offers higher income potential and geographic diversification beyond UK/US — which is helpful.
• Key risk: Higher yield often reflects higher risk — here exposure to emerging markets/Asia & currency risk & possibly higher volatility. Might be less “safe” than a UK equity income trust.

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5. Chelverton UK Dividend Trust (ticker CDIT)

• UK equity income trust focused on smaller companies. Yield reported at around 7.5% in data to August 2025. AJ Bell+1
• For a retirement portfolio: This can boost yield and add small-cap exposure (which can drive growth).
• Key risk: Small cap companies often have higher business risk, may cut dividends in downturns, and the ongoing charges tend to be higher (which reduces net income for investors) as noted by AJ Bell commentary. AJ Bell

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✅ Why these are “world-class” (in a UK context) for dividend/retirement income

• All have long histories of paying/increasing dividends (e.g., City of London with 59 years of increases).
• They offer yields considerably above the typical market (FTSE All-Share might yield ~3.5-4%).
• They provide diversification across geographies (UK, Asia, infrastructure) and asset types (equity income vs infrastructure).
• The investment-trust structure has beneficial features for income-seeking (closed-ended, ability to retain reserves to smooth dividends, long-term horizon) — commentary from the AIC notes this is a key advantage.

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⚠️ Some important caveats

• Dividends are never guaranteed. Past increases don’t guarantee future increases.
• Yield isn’t everything: A high yield might come with higher risk (business risk, valuation risk, discount to NAV risk, sector/regulatory risk).
• Diversification risk: If you load up on UK equity income trusts you may miss out on growth or global diversification.
• Inflation risk: Even a 4-7% yield may not keep up with inflation over long retirements unless there’s dividend growth.
• Tax and currency: If you’re UK-resident, dividends are subject to UK dividend tax rules. For trusts with overseas exposure (Asia, infrastructure) currency and overseas tax/growth effects apply.
• Discount to NAV risk: Many trusts trade at a discount to net asset value — that can offer opportunity, but also reflects investor concerns.
• Gearing/leverage risk: Some trusts borrow (gear) which can amplify dividends but also amplify losses in downturns.

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🔍 My selection criteria summary

• Yield ≥ ~4-5% in the UK context.
• Long record of consistent dividends or increasing dividends.
• Diversified across sectors/geographies.
• Sufficient size/liquidity (to ensure you can get in and out).
• Reasonable cost/ongoing charges and understandable risk profile.

Here are five world-class investment trusts with strong dividend records ideal for a retirement portfolio: City of London (CTY), Bankers (BNKR), F&C (FCIT), Scottish Mortgage (SMT), and Henderson Smaller Companies (HSL). These trusts have consistently raised dividends and offer diversified exposure across sectors and geographies.

🏆 Top 5 Investment Trust Dividend Shares for Retirement
These trusts are recognized as “Dividend Heroes” by the Association of Investment Companies (AIC), having increased their dividends for at least 20 consecutive years:

1. City of London Investment Trust (CTY)

• Dividend streak: Over 57 consecutive years of increases
• Focus: UK equities with a tilt toward income-generating blue chips
• Yield: Around 4%
• Why it’s great: CTY is a stalwart for income investors, offering stability and a long-term track record.

1. Bankers Investment Trust (BNKR)

• Dividend streak: Over 55 years
• Focus: Global equities with a balanced approach
• Yield: ~2.2%
• Why it’s great: BNKR provides global diversification and consistent income growth.

1. F&C Investment Trust (FCIT)

• Dividend streak: Over 50 years
• Focus: Global equities with a large-cap bias
• Yield: ~1.5%
• Why it’s great: FCIT is one of the oldest trusts, offering broad exposure and steady income.

1. Scottish Mortgage Investment Trust (SMT)

• Dividend streak: 40+ years
• Focus: High-growth global companies, especially in tech and innovation
• Yield: ~0.9%
• Why it’s great: While the yield is low, SMT offers capital growth potential and a long-term dividend record.

1. Henderson Smaller Companies (HSL)

• Dividend streak: 20+ years
• Focus: UK smaller companies
• Yield: ~2.5%
• Why it’s great: Adds exposure to UK small caps with a reliable income stream.

🔍 Why These Trusts Work for Retirement

• Consistency: All five have long histories of annual dividend increases.
• Diversification: They span UK and global markets, large and small caps.
• Resilience: Their ability to smooth dividends using revenue reserves makes them ideal for weathering market downturns.
  co pilot

Here’s how the dividend income on a capital investment of 10k grows when compounded annually at 7%, using the formula:

A = P \cdot (1 + r)^t

Where:

• P = 700
• r = 0.07 (7% annual interest)
• t is the number of years

If you have longer to compound

Reaching 53%, you have to allow for inflation and any for any years when the dividend yield is under 7% but you will have years like now when the dividend yield is above 7%. On the capital invested, the dividends should gently increase and you will get the yield on your buying price not the current headline price.

Near-zero savings ? Start building wealth with Warren Buffett’s golden method

Learning these Warren Buffett tips can help investors potentially become significantly richer in the long run, especially when starting early.

Posted by Zaven Boyrazian, CFA

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice.

Warren Buffett is one of the most successful stock market investors in the world, with a net worth of almost $150bn. That’s despite starting out with only around $2,000.

Throughout this journey, he’s been quite a vocal teacher, offering powerful advice over the years to guide the next generation of investors. And while the economic landscape’s very different in 2025, Buffett’s method remains a proven strategy for building long-term wealth, even when starting with little-to-no savings.

Focus on the business

In the short term, the stock market can feel a bit like a casino with prices jumping up and down almost randomly. But in the long run, shares ultimately move in the same direction as the underlying business.

So long as the company’s able to grow and create value, the share price will eventually follow. Yet that rarely happens overnight. That’s why Buffett once said: “What we really want to do is buy businesses that we will be happy to hold forever”. And in order to do this confidently, investors need to dive deep into research, or as Buffett puts it, “you have to understand the business”.

Depending on the company, the process can be a lengthy one. And it’s also why the ‘Oracle of Omaha’ strategically only looks at stocks within his circle of competence. But even then, when hunting for the best businesses in the world, Buffett admitted, “we can’t find a lot of them”.

As someone who’s been analysing stocks for over a decade, following these core principles, my research often ends with a ‘not good enough’ conclusion. And it’s why Buffett also advised that investors who lack the stamina to invest in this way should opt for passive index funds.

But “for those willing to put in the required effort”, stock picking can open the door to tremendous long-term wealth.

Practising what he preaches

Perhaps a perfect example to consider is Coca-Cola (NYSE:KO). Buffett first bought its shares in 1988, recognising the soft-drink company’s powerful global brand that granted the business an enduring competitive advantage.

Since then, he’s never sold a single share. And with earnings expanding as the firm entered and captured new markets, dividends have been hiked consistently. The result ? His initial investment’s now generating a yield close to 60% a year !

Fast forward to 2025, and Coca-Cola continues to demonstrate the world-class traits Buffett loves to see. Management has been adapting its product range to shifting consumer tastes, most notably with its Coke Zero variant. And with the group’s digital transformation offering new efficiency opportunities, Buffett continues to hold his shares, enjoying consistently and reliable dividends.

Does that make Coca-Cola a no-brainer buy in 2025? Not necessarily. Having reached a $290bn market-cap and worldwide dominant status within the beverages industry, Coke’s future growth is likely to be less impressive moving forward. And while management’s diversifying the product portfolio to tap into new opportunities, the group nonetheless faces rising pressure for both its growth and profit margins. 

How big does an ISA need to be for someone to quit work and retire early?

Ben McPoland explores how long it might realistically take to reach financial freedom investing regularly in a Stocks and Shares ISA.

Posted by Ben McPoland

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

Most people invest inside a Stocks and Shares ISA to help them live a more comfortable life later on. Some might even reach a point where their portfolio supports early retirement.

But how realistic is this ? And how long might it take? Let’s take a closer look.

Aiming for £1.5m

The obvious thing to note is that what one person would need in retirement is totally different to someone else. So is the affordable amount to invest every month.

For example, industry data show that most people fail to max out their £20k annual ISA allowance. When we consider that the median full-time annual salary in the UK was about £37,000 last year, this makes sense. 

As such, what sum and time is needed is highly variable. But for simplicity’s sake, I’m going to assume a figure of £1.5m would be enough.

Wealth-building takes time

Now, reaching that amount might sound like a fairy tale when starting from scratch. But the following table shows how quickly this sum could be reached investing £600 every month. I’ve included three rates of annual return (8%, 10%, and 12%).

8% return*	10% return	12% return
37 years	32 years	28.5 years

*Figures do not include platform charges, and assume all dividends are reinvested.

Taking the middle 10% return scenario, this shows that it would take 32 years to reach £1.5m. So a 30-year-old could quit work and retire at 62 rather than 68 (or whatever the State Pension age is by then).

Were this investor to achieve a higher 12% average return, this would shave nearly four years off.

Some top investors have generated returns far in excess of 12%, including Warren Buffett (an incredible compounded annual return of about 20%). A person generating such a return would reach this target inside 21 years.

However, this type of return is very rare (after all, there’s a reason Buffett is a celebrated billionaire!). Indeed, 12% might even be stretching it, as the long-term global market average is more like 9%-10%.

To show what’s possible, here are two tables showing how quickly £1.5m could be reached investing £1,000 and £1,666 per month (the latter being the maximum allowance).

£1,000 per month	8% return	10% return	12% return
	31 years	27 years	24 years

£1,666 per month	8% return	10% return	12% return
	25 years	22 years	20 years

If you are starting out with a dividend re-investment plan, the good news is that compound interest takes a while to make a noticeable difference, better if you can add fuel to the fire with a yearly contribution.

The highest-yielding money market funds to park your cash in

Investors can get around 4% inside a tax-efficient wrapper with these fund ideas.

3rd October 2025 15:29

from interactive investor

In the UK, the Bank of England base rate is now 4%. Interest rates are falling although inflation is proving somewhat sticky. 

Interest rates influence bond yields, as well as the returns from easy-access and fixed-term savings accounts.

• Invest with ii: Money Markets| Bond Yields| Tax Rules for Bonds & Gilts

Investors have a number of options. While they could buy UK government bonds (gilts), with 10-year gilts yielding 4.7%, they could also stray into the corporate bond market, where yields are even higher. However, bond prices can be very volatile, and investors could be hit with capital losses even if the income is stable.

Savings accounts are another option, but yields tend to lag bond market equivalents. Moreover, unless the account is inside a cash ISA, where returns are lower, savers may have to pay tax on their returns.

Basic-rate taxpayers (up to £50,270 annual income) get a £1,000 tax-free savings allowance, while higher-rate taxpayers (up to £125,140 annual income) get £500 and additional rate taxpayers (earning more than £125,140) get nothing. Any savings interest above the thresholds is taxed at income tax rates.

Money market funds could fit the bill

Money market funds are a viable in-between option, offering the income similar to gilts maturing soon, but without the complexity, while also mitigating the risk of bond price fluctuations. They can be held inside ISAs and SIPPs.

They own a diversified basket of safe bonds that are due to mature soon, normally within just a couple of months, meaning that investors can earn an income on their cash with minimal risk. They can also put money into bank deposit accounts and take advantage of other “money market” instruments offered by financial institutions. 

On our platform, assets in money market funds have risen 1,100% (a 12-fold increase) in the past two years.  

Fund industry trade body the Investment Association (IA) categorises money market funds into two buckets: short-term and standard-term funds.

Short-term funds are lower risk. Fund managers try to ensure the highest possible level of safety by keeping very short duration bonds and high-quality bonds in the portfolio.

Standard money market funds generally deliver slightly higher returns by owning bonds that have slightly longer maturity dates. There are also less stringent liquidity requirements. 

The short-term money market funds on the ii platform, as of the latest data available on 31 August 2025, include Royal London Short Term Money Market (4.1% yield); L&G Cash Trust (4%); Fidelity Cash (4.05%); BlackRock Cash (4.08%), and Vanguard Sterling Short Term Money Market (3.95%). A fund’s fees will eat into the yield.

The Royal London Short Term Money Market fund is one of interactive investor’s Investment Pathway options for investing in drawdown to access all or part of their pension. The Royal London option is for those planning to take out all their money within the next five years.

Fund	Ongoing charges figure (%)	Yield (%)	Fund size (£million)
Royal London Short Term Money Market	0.10	4.10	9,521
L&G Cash Trust	0.15	4.00	3,399
Fidelity Cash	0.15	4.05	2,279
BlackRock Cash	0.20	4.08	1085
Vanguard Sterling Short Term Money Market	0.12	3.95*	1,800

Source: FE Analytics/ latest data published as of 31 August 2025. *As of 26 September. Past performance is not a guide to future performance.

The standard money market funds on the ii platform include: Premier Miton UK Money Market (4.01% yield); Invesco Money (UK) No Trail (4.21%) and abrdn Sterling Money Market (4.3%).

Fund	Ongoing charges figure (%)	Yield (%)	Fund size (£million)
Premier Miton UK Money Market	0.26	4.01	317
Invesco Money (UK) No Trail	0.15	4.21	123
abrdn Sterling Money Market	0.15	4.30*	942

Source: FE Analytics/ latest data published as of 31 August 2025. *One-day yield figure sourced on 3 October. Past performance is not a guide to future performance.

Investors usually have a choice between an accumulation (acc) or income (inc) version of a fund, which determines whether income is automatically reinvested or paid out as cash. 

Dzmitry Lipski, head of funds research at interactive investor, says: “Royal London Short Term Money Market stands out most to us in the sector. It has an excellent long-term track record, low drawdowns and is competitively priced with a yearly ongoing charge of 0.10%.

“The fund seeks to maximise income by investing in high-quality, short-dated cash instruments. The managers place particular emphasis on the security of the counterparties it lends to, while ensuring daily liquidity.”

The interest paid by money market funds will fluctuate with bond market yields, which are closely linked to central bank interest rates. This means it will rise when yields rise, but fall when yields fall. As interest rates are expected to keep dropping this year and next, yields on money markets are also likely to drop. 

Bond yield: the key terms

There are three key terms that bond investors need to get their heads around: yield to maturity (also known as the running, or redemption yield), historic (or annualised) yield, and distribution yield.

Assuming all portfolio coupon payments (the level of interest promised) are made, and the principals on bonds (amount lent) are returned, the yield to maturity of a portfolio is the total annual return of a fund if all bonds are held to maturity. This assumes no portfolio changes. It’s a measure that bond fund managers use to assess what their portfolio is forecast to return, including when they get their capital back when a bond matures.

In reality, these figures change as the fund manager is constantly selling and buying bonds, but they are a helpful snapshot about return potential and income distributions.

 Advantages of a money market fund

• Very low risk, with the portfolio likely to at least hold its value and also pay out a modest income
• Diversified, meaning investors are not exposed to a single bond failing and can withdraw their money easily
• Can be held in a tax-friendly wrapper, such as an ISA or SIPP.

Disadvantages of a money market fund

• Investments may fall in value, unlike savings accounts
• Not suitable for growing savings over the long term as inflation will eat into returns
• Sensitive to interest rate fluctuations, with lower rates leading to lower yields. Yields rise when interest rates rise
• The Bank of England warns that in times of market panic and a rush to cash, there may be liquidity issues in money market funds.

This article was originally published on 30 October 2023 and updated on 3 October 2025.

Somewhere to squirrel your spare cash into, hopefully profits when you rebalance your Snowball, as you wait for the next market crash, so you have funds to buy a bargain. Sacrificing some near term interest for longer term gains.

These Utility Dividends Up to 10% Are Riding the AI High

Brett Owens, Chief Investment Strategist
Updated: October 24, 2025

Wall Street still treats utilities like income relics. Big mistake.

The same wires and substations that power your home now feed NVIDIA’s data centers—and our portfolios. These “boring” utilities are morphing into AI toll collectors, handing us up to 10.4% dividends while vanilla investors chase momentum stocks.

Take Texas, for example. The grid is strained. The population is popping. New residents, factories and AI campuses are all plugging into the state’s aging grid at once. The math is no longer “mathing” and it’s about to get worse. ERCOT projects power demand will jump 62% by 2030—yikes!

And Oncor, the state’s largest utility, believes that is way too conservative. Its interconnection queue shows 186 GW of requests waiting to plug into the grid—more than double today’s peak demand (118% more!) and enough to power every home in Texas twice over!

Texas isn’t the home of the only strained grid. Let’s head to the Northwest and visit Portland General Electric (POR, 4.8% yield), which provides electricity to 1.9 million customers across more than 50 cities in Oregon. Thanks to early AI grid work, this near-5% payer is one of the few “boring” utilities with genuine growth voltage.

This West Coast Utility Delivers Even-Keeled Price and Dividend Growth

“PGE” is gearing up for the AI revolution. Recently, it announced that it’s using a new AI-enabled flexibility tool that will free up more than 80 megawatts for datacenter interconnections next year. Here’s a little detail, courtesy of digital business mag Utility Dive:

“PGE partnered with the California-based startup GridCARE, which uses AI, detailed hourly demand modeling and optimized flexible resources like batteries and onsite generators to find spare capacity. The added flexibility allows PGE ‘to interconnect multiple data center customers years earlier than initially expected,’ the companies said.”

Oregon, and Portland specifically, is currently a decent-sized datacenter market, though many other states are seeing a more rapid rate of expansion. In the meantime, PGE is ramping up investments in its own infrastructure; however, some of those costs are to mitigate the state’s growing risks for severe wildfires.

Fire risk keeps investors away, but a near-6% yield and single-digit P/E make

Edison International (EIX, 5.9% yield) a classic contrarian setup. One positive legal surprise and this scorched stock could light up. Edison serves more than 15 million customers and generates much of its electricity from renewable sources including solar, wind, and hydro. EIX also has an unconventional second business: a global energy advisory division.

EIX’s forward price-to-earnings (P/E) ratio sits at just 9; that’s less than half the sector. Its price/earnings-to-growth (PEG) ratio of 0.6 signals it’s on sale, too. (Any PEG of less than 1 is considered undervalued.)

Edison is cheap for a reason, but that reason is no secret. While PGE might have wildfire risk, EIX has known wildfire exposure—specifically, it has spent years fighting litigation over wildfire damage and has paid multiple billion-dollar-plus settlements.

Fire Has Repeatedly Burned Edison’s Bottom Line

Edison could still be on the hook for billions more related to the Eaton fires. It looked like EIX was due for some relief in September, when the California Legislature passed SB 254, creating a wildfire fund continuation account that Edison and other state utilities could tap for future wildfires—but the $18 billion figure was weaker than expected, leading S&P Global to lower its ratings on Edison’s various debt issues.

The flip side? EIX is big on renewable energy, its SoCal residential base is huge, it has an otherwise strong balance sheet, and it pays nearly 6%, dwarfing the sector average. Positive surprises about any Eaton liabilities could jolt the stock to life. So, Edison remains a much bigger high-risk, high-reward gamble than the average utility.

Canada’s Brookfield Infrastructure Partners LP (BIP, 4.9% yield) the global toll collector for the AI age—power lines, pipelines and 100+ data centers. BIP blends stable cash flow with growth tailwinds we usually pay tech multiples for.

And BIP’s assets give us two ways to leverage the AI megatrend.

For one, Brookfield boasts 8.6 million electricity and natural-gas connections, 4,500 kilometers of natural gas pipelines, and 83,700 kilometers of electricity transmission lines. But it also has a data segment that includes 312,000 operating towers and rooftop sites, 28,000 kilometers of fiber optic cable and more than 100 datacenter sites.

The problem (or advantage, depending on one’s point of view) of Brookfield is we’re getting a little bit of exposure to a lot of different things. That’s the nature of a conglomerate. But while the assets are infrastructure in nature, it’s not a very defensive stock—the flip side to that is BIP will often give us buyable dips.

However, It’s Not in One Now 

Broadly, though, BIP is a well-paying stock that has raised its distribution for 16 consecutive years. I say “distribution” because it’s structured as a master limited partnership. Now, 99.9% of the time, that’s a drawback given that MLPs force us to deal with Form K-1 come tax time, but Brookfield is special—it has a mirror corporate structure, Brookfield Infrastructure Corporation (BIPC), that pays out qualified dividends instead. Alas, those shares only yield about 3.7% right now.

We can get even sweeter yields out of the utility space by investing via closed-end funds (CEFs).

Consider the MEGI NYLI CBRE Global Infrastructure Megatrends Term Fund (MEGI, 10.1% distribution rate), for instance. This mouthful of a fund is somewhat similar to BIP in that it’s not a true utility fund. But we’re still getting a heaping helping—55% of assets are allocated to utility companies such as Essential Utilities (WTRG), PPL Corp. (PPL), and PG&E Corp. (PCE). But we also get double-digit exposure to transportation, communications, and midstream/pipelines. We even get some preferred stock.

And thanks to liberal use of leverage (24% currently), we get a fat double-digit yield.

What we don’t get is much in the way of return.

Even Plain-Vanilla ETFs Have Trounced This Pseudo-Utility Play

Like with Brookfield, this global infrastructure CEF is a little too broad. I hesitate to recommend it here or in my Contrarian Income Report. However, I do keep my eye out for deep discounts on MEGI that we can take advantage of in Dividend Swing Trader. The price is currently just OK—yes, it trades at a decent 7% discount to net asset value (NAV), but that’s not even cheaper than its longer-term average discount of more than 12%.

We get much better utility exposure with the Gabelli Utility Trust (GUT, 10.4% distribution rate). This still isn’t a pure-play utility-sector fund, but now we’re at close to 70% utilities (including EIX and POR), and another 15% or so in utility-esque telecom stocks like Deutsche Telekom AG (DTEGY) and Vodafone Group (VOD).

Long-term, GUT has been much more competitive with rank-and-file sector ETFs, though its moderately levered nature (15%) and exposure to other sectors has made it more volatile over time. So, like with MEGI, our best bet is to be patient and pounce on dips.

Gabelli’s Fund Trails Long-Term, But Timing Is Key to Outperformance

But it’s almost a foregone conclusion we’ll never get truly bargain prices on GUT. Shares currently trade at a wild 83% premium to NAV, which is somehow a smidge cheaper than its long-term average premium of around 90%. The cheapest it has traded over the past year or so is at a 50% premium to NAV.

Wall Street chases AI stocks that might go higher. We’ll take the utilities that power them—and collect a sure 10.4% while we wait.