Bear Market: The Passive-Income Investor's Dream
Bear market stock prices have driven up dividend yields. This lets investors put their dividends back into stocks with higher yields.
They can also make more money by putting their extra cash to work. This can help investors make a lot more money from their passive income.
Some investors have their dividends automatically re-invested, while others invest that money by hand as they see fit.
In either scenario, a bear market results in an increase in the amount of passive income generated by dividend income.
Investors can lose a lot of money in a bear market. Because stock prices have dropped by more than 20%, many investment portfolios are a long way from their recent highs.
But if you own stocks that pay dividends, a bear market can be a blessing in disguise. This is because the Stock price and dividends go in opposite directions.
Bear markets are hard for people who have all their money in stocks that don't pay dividends. But they are a chance for people who have cash or assets that bring in money.
Investors can make more passive income during bear markets because they can turn dividend income and idle cash into bigger income streams.
This can enable investors make more money in the future, which can help them get even closer to their financial goals.