With no savings at 35, I’d buy this dividend stock to start earning monthly passive income

Investing in dividend stocks can be a great way for investors to increase their income. I have a few in my own portfolio.

If I was just starting out with no savings, some of the stocks I would buy were the ones in my portfolio. Another, though different.

In particular, there is one dividend stock that I do not own that I will start with today. This deposit Agree Realty (NYSE:ADC).

Agree Realty

Agree Realty is a real estate investment trust (REIT). It means making money by renting out properties to tenants and distributing the income as dividends to shareholders.

The company focuses on retail properties. And it pays dividends every month, which means that if I buy a stock today, I won’t have to wait long before my first payment comes in.

So far, such a company Realty Income (NYSE:O). And it’s true that they have a lot in common.

Beyond the monthly dividend and retail portfolio, both try to limit risk in the same way. Each focuses on quality tenants that are immune to the threat of e-commerce.

When I added REITs to my portfolio, I decided Realty Income stock was a better opportunity. But things would be different if I started today.

Excess

The biggest advantage Agree Realty has over Realty Income is its size. With a market capitalization of $6.64bn (compared to $42.6bn), Setuju Realty is smaller.

That makes it easier for Agree Realty to grow its property portfolio and boost its dividend in a meaningful way. And recent history shows this.

Over the past five years, Realty Income Corporation has paid a 3.5% dividend per share and an annual dividend yield of 3.5%. But Agree Realty has achieved an average annual return of 6.5%.

The stock has a dividend yield of 3.9% (compared to 4.4% for Realty Income). But in the long run, I think the growth prospects of smaller companies will be decisive.

interest rate

One thing I would like to keep this stock on is the interest rate. I see rising rates as the biggest obstacle to a significant return on investment from Setuju Realty.

Higher interest rates can cause stock prices to fall as investors find it easier to yield cash and bonds. And it may consider the value of the company’s portfolio if the property market declines.

It’s a significant concern for me, though. I want to use lower stock prices to boost my investment with better rates of return, and falling property prices will allow my business to do the same.

what shall so the concern for me is the possibility of rental income sticking. But there are no signs of this – the company’s rental collections are consistently strong.

If I had no savings and started my investment journey today, I would start by having enough money to see me through in an emergency. Then I will buy shares in Agree Realty and start collecting monthly dividends.