Overview
- Average high-yield savings rates have fallen from about 5.1% in March to roughly 4% in November, and some analysts predict they could near 3.5% if further Fed cuts occur by mid-2026.
- Schwab U.S. Dividend Equity ETF (SCHD) is a leading pick with about a 3.88% yield, roughly 100 holdings focused on consistent dividend growth, and a 0.06% expense ratio.
- Vanguard options offer broader approaches: VYM holds about 569 stocks with a 2.51% yield, while VIG targets companies with at least 10 years of dividend increases, spans 330+ names, and charges 0.05%.
- A practical blueprint shows that roughly $235,000 deployed across dividend ETFs and select REITs at a 5.1% weighted yield can generate close to $1,000 in monthly income, with guidance to avoid chasing double-digit yields.
- Historical data cited in the coverage indicate dividend payers have outperformed non-payers since 1973, with dividend growers posting the strongest long-term total returns.