Income Investing: Here's How Any Regular Investor Can Do It | Steven Bavaria

One of the most frequent requests from Thoughtful Money viewers is for a discussion focused on investing for income. Well, that's what we're delivering here.

Steven Bavaria, author of the book 'The Income Factory: An Investor’s Guide to Consistent Lifetime Returns' joins us to share his framework for constructing a lower-risk portfolio of income-generating assets that include: high dividend stocks, senior bonds, high yield bonds, covered call funds, Master Limited Partnerships, closed-end funds, and more.

#incomeinvesting #dividendstocks #fixedincome
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We produce educational content geared for the individual investor. It’s important to note that this content is NOT investment advice, individual or otherwise, nor should be construed as such.

We recommend that most investors, especially if inexperienced, should consider benefiting from the direction and guidance of a qualified financial advisor in good standing with the Financial Industry Regulatory Authority (FINRA) who can develop & implement a personalized financial plan based on a customer’s unique goals, needs & risk tolerance.

IMPORTANT NOTE: There are risks associated with investing in securities.

Investing in stocks, bonds, exchange traded funds, mutual funds, and money market funds involve risk of loss. Loss of principal is possible. Some high risk investments may use leverage, which will accentuate gains & losses. Foreign investing involves special risks, including a greater volatility and political, economic and currency risks and differences in accounting methods.

A security’s or a firm’s past investment performance is not a guarantee or predictor of future investment performance.

[tatersquad]

I like how Steven is not afraid to call out actual tickers that fit his investing framework. That's what I call actionable.

[GaryRummelhoff]

I became interested in closed end funds in 2016 and fully adopted this approach in 2017. At the time of my retirement in December 2019, I had refined my approach to selecting funds and allocating investments across 30 to 35 funds. In the past 2 years I have added BDCs. CAGR is 10.25% in the four years. During this period, I road out the dips in March 2020, October 2022 and most recently the drawdown in October 2023. The annual dividend returns have been in the range of 8% to 9% for this four year period. I'll never go back to investing for appreciation in price and will remain focused on income and compounding returns. Yes, I sleep well at night.

[dr.jstudio]

Imo, this has been one of the best Wealthion/Thoughtful Money episodes ever. The more theoretical episodes (which is most of them) are really good, but it's hard to beat this one for being actionable. Building an "income factory" has been the backbone of my investment strategy, but I didn't know it was known by that term. This discussion has given me some ways to further refine this strategy and given me some specific promising securities to look into that I didn't already own. Thanks so much!

[Silvangreen]

I initially adopted this strategy after 2009 for a portion of my retirement portfolio to offset zero interest rates. I mostly use closed-end funds. It’s a long term process. Own a variety of fund types as they will have different discount / premium cycles and dynamics. Make sure to buy extra shares on broad market dips (see March 2020). That discount is a gift that keeps giving. I occasionally sell some of a fund when it reaches a large premium to NAV and buy more of a fund trading at a discount. In the aggregate, I make decent capital gains in addition to the generous dividends. For me it’s been a fun long-term investment project.

[VanillaCherryBread]

I have a 3 fund portfolio but I have finally decided to invest in ETFs, alongside. I’m looking at SCHD, VOO, XLK or SCHG.

[dalehutchings]

I just stopped your program and went to Amazon and bought the book and the audio book as well. Been listening to your podcast for a very short time, and I love it. This program may just be what I have been looking for. I was the person who was making. 05% on my money in a savings account. To conservative. I like boring like 7% on my money. Thank you for this discussion. I am almost 70 years old. But not to old to learn. Thank you my friend. Be Blessed 🙌

[dirtmeister]

Been watching Wealthion/TM for almost a year now. This is in my top 3 favorite episodes. Excellent all around to the very end.

[jenniferrakonjac]

This is my style. During the 2022 downturn my portfolio went down on paper. However I was constantly receiving a 10% income stream. My balance has now recovered and still receiving the income.

[billgoodrich]

Best interview ever as I just retired and adopted a similar strategy a few years ago.. The thing you need to do is just readjust your thinking and as the man says as long as they keep paying the dividend that was the plan all along and even when the positions drop the money keeps rolling in and you are accomplishing what you want and your investments will eventually come around if they don't actually go out of business.. Getting more info to us that are retiring is great... Thanks a lot.. ..

[peterkolbe]

Absolutely great interview with Steven Barvaria! What a clear, concise, and very helpful articulation of a topic that I don't hear enough about as a pre-retiree with 4 years to go. Please have him back on the show, and thank you for everything you do to educate investors!

[arniesteinlage]

YES....have Steven back in the future! Great! Thanks

[mtanner]

Steven was awesome. Please have him back.

[CaleHeintz]

I would love to have him back SPECIFICALLY to speak about his thoughts around fund expenses/fees and taxes, which would be my biggest areas of concern to address for this type of strategy.

[clbrown]

Refreshing to see an optimistic topic that’s not all doom and gloom. An investment approach I would never have considered. Great interview as usual Adam

[gailjacobo]

Good job Adam and Steven! I just felt my paradigm shift. It would be good to have Steven back some time in the future.

[edyochum]

One of your best interviews ..this gentleman is not selling anything other than his knowledge to help other people, very refreshing, but no surprise considering your new platform.
Thank you!

[DukeOkes]

Really good stuff for retirees who have build up a portfolio thru growth, and now want to convert to income.

[davecirelli]

Closed end funds and REITs have been the backbone of my portfolio. We are all investing in the markets for income one day. Create your own pension with growth. It is a winning strategy even though you have to consider taxes on dividends especially if you are still working a job. Thanks to buying more and more shares like a nutcase during the COVID crash an the interest rate shock to the markets, I am able to enjoy life today.

[whodidit]

Good video. Would be great to have him on again and do an actual income factory for different levels of capital accumulation, or by age. That would be awesome.

[johnbeeck]

Rob, there is another YouTuber who focuses on High Yield investments - very thorough review of each type and specific instruments to consider - gives pros/cons of each, who might benefit, who might not, and how it might perform in various market/interest environments. He does not believe in leverage. Armchair Income is the channel. Would be a great guest!