How to Invest to Create a Dividend Income

by | Feb 15, 2023

Are you looking to create a steady income stream through investing? One of the best ways to do so is to look at investments that generate a dividend income. While there are some risks involved, with the right approach, you can find a steady source of income that can help you reach your financial goals.

What Is a Dividend?

A dividend is a payment made to shareholders of a company. This payment is usually made on a regular basis, such as quarterly or yearly. Dividends are typically paid either as cash or additional shares. Dividend payments are based on the profitability of the company, so if the company does well, you can expect larger payments.

Types of Dividend Investing

There are several different types of dividend investing. The most common type is dividend stocks, which are stocks that pay out a portion of their profits as dividends to shareholders. Another type of dividend investing is REITs, which are real estate investment trusts. These are specialized companies that own and manage real estate investments and typically pay out a portion of their profits to shareholders as a dividend.

Benefits of Investing in Dividends

The primary benefit of investing in dividends is that it can provide a steady source of income. This can help you reach your financial goals, such as retirement or a down payment on a home. Additionally, dividends can be used to offset losses in other investments, so they can help you manage the risks associated with investing.

When to Take Out Equity From Your Home

In some cases, it can be a good idea to take out equity from your home to invest in dividends. This is especially true if there is a large amount of equity in your home, and you are sure that you can make a higher return from investing the money than you would from leaving it in the house. Additionally, taking out equity from your home can be a safer option than investing in the stock market, especially for those who are not comfortable with more risky investments.

However, taking out equity from your home should not be done lightly. You should make sure that you have the ability to pay back the loan, and you should carefully consider what type of investments you are going to make with the money.


Investing in dividend stocks or pulling out equity from your home can be very beneficial as this is taking advantage of what is called the Smith Maneuver in Canada. Don’t hesitate to schedule a call with us to assist you with your mortgage needs!

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