One of the biggest things I continue to wrestle with is returns vs. income.

Investing for the long run in a well-diversified, low-cost portfolio is such a well-established strategy.  I mean, The Simple Path to Wealth can literally be summarized by “Buy & hold VTSAX”.

That said, there’s something fundamentally attractive about passive monthly income.  While the math doesn’t change, why does it feel better to get a dividend check than to sell shares for the same amount?

For now, I’m convinced that I prefer the former.  My goal to-date is to get to $10K in monthly passive dividend income, and I’ve explored a few options:

1). Rental property—1 so far, paid-in-full for $360K, renting for $2800 a month.  Net management fees, taxes, insurance, and maintenance, I’m looking at $1400, or a bit south of 5%.

To get to $10K, I’ll need at least another 6 more of these.  The rub though is that this house is now worth $560K, so I’ll need $3.4M+.

At my current savings rate, I’m looking at $180K cash per year, at best, and I only have $160K saved up now.  So we are looking at 15+ years, easily.

2). Straight dividend—Not too much different from above.  I like SCHD and VYM.  I already have SCHD in my Roth, so focus is on VYM.  Currently I’ve got $5K in brokerage, and adding $1K every month.  With VYM returning 3%, and me starting at pretty much ground zero, it will be a similar, long, climb.

3). Covered calls—I fell in love with QYLD: 12%, monthly distributions, return of capital tax treatment.  Can’t we just sweep the whole -28% price dive in the last 10 years under the rug?

My $250K QYLD portfolio has a cost basis of $19 / share, so with current share prices below $18, I am in the red.  Still, that $2500 monthly distribution is oh so sweet.

With my basic modeling, assuming -3% annual price growth, and 11.5% annual distribution rate, if I put all of my $160K into QYLD, and reinvest all dividends + cash from rental property, I can get to $10K a month by April of 2031, or about 7 years.  And possibly sooner if things trend well.

I know, I can do better, but why does it feel so good? So what do you think, worth a shot?