High-Yield In Retirement: BDCs Vs CEFs And The After-Tax Income Trade-Off

2026-01-14 05:26:38 ET

Different Ways to Do 'High-Yield' in Retirement

High-yield investing is a popular way to make one's money stretch farther. Sometimes this is just an illusion, as an investor might be better off just looking at total return and being broadly invested in the market ( SPY )( VOO )( IVV )( QQQ )( DIA ), but sometimes it makes sense. Where it makes sense, in my opinion, is when a retiree does not want to do a lot of portfolio manipulation, rebalancing, or calculus of their guardrails regarding their own personal safe withdrawal rate. Many in the financial planning community believe that a safe rate lies somewhere between 4-5% per annum when sloughing off chunks of a typical 60/40 portfolio invested 60% in equities and 40% in bonds ( BND )....

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