Top dividend income funds to invest in
Being financially secure for life is a dream for everyone, but fulfilling it may be a major challenge unless one doesn’t have at least the basic knowledge about financial management. Earning a steady salary is merely the first step; multiplying it is the main one. In that sense, investing in income funds which offer big dividends in return is a perfect choice.
One of them is the expense ratio, which basically indicates the per annum amount an investment company charges for the sum invested by a consumer. The other factor is that dividends earned may be used to buy more shares, thereby reinvesting them in a process known as the Dividend Reinvestment Program (DRIP).
Here are two of the best dividend income funds which have been relied upon and consistently given benefits to the investors:
- Vanguard International High Dividend Yield Index Fund ( VIHIX )
The specialty of VIHIX lies in the fact that it gives investors the much-needed exposure to nearly 800 stocks in companies both in and out of the country. They are estimated to deliver above-average yields at a cost of 0.42%, which is 64% less than an average expense ratio of funds of a similar type. It means that if a person invests the minimum amount set of $3000, he or she would have to pay only $12.6 to the investment firm for the same. The fund has large-cap value, which signifies that it is suited for those who have investment goals for the long-term and may persevere with the volatility of stock markets.
- Fidelity Capital and Income Fund (FAGIX)
This is amongst the best dividend income funds that also gives an investor capital growth in the form of diversification. A minimum investment of $2500 is required and as of June 29, 2018, an investor will have to pay around $16.75 due to an expense ratio of 0.67%. The fund claims that each year, an investor gains 5.69% annual returns on an average and persisting for 10 years takes it to 8.55% and more. This fund ought to rank in the top dividend income funds as it consists mainly of high-yield bonds, involving maximum returns against average risks.
