Brookfield Infrastructure Partners

BIP

Market cap $18B

A common misconception is that generating enough dividend income to cover living expenses is all that you need to retire. I detail the three investments that I would use as the foundation of my retirement strategy.

North America's freight rail map is about to be redrawn. The proposed merger of Union Pacific (NYSE: UNP | UNP Price Prediction) with Norfolk Southern (NYSE: NSC) would create the first transcontinental railroad, and the Surface Transportation Board review will almost certainly require divestitures of regional lines, yards, and equipment.

Most investors think you have to choose between high yield and dividend growth. However, this is not always the case. I detail the five non-negotiable criteria for identifying high-yielding stocks that are also elite dividend growers.

MLPs remain highly attractive for income investors due to defensive cash flows, CPI-linked contracts, and yields averaging ~7.5%. Recent MLP price surges do not signal overvaluation; current valuations are not detached given sector fundamentals and macro risks. MLPs have deleveraged, consolidated, and now benefit from higher inflation expectations and a flight-to-quality dynamic.

Brookfield Infrastructure Corporation shares are undervalued versus BIP due to concerns over a potential share structure consolidation. BIPC trades at just 11x 2026E FFO with projected 10% annual FFO growth and a 4.6% forward dividend yield, offering a compelling risk/reward. The dual share structure's future is uncertain, but BIPC's tax-advantaged dividends and discounted valuation create a unique buying opportunity.

High monthly dividend yields are very attractive to investors who live off of passive income from dividend investments. However, not all of these investments are created equal, especially in the covered call arena. I compare GPIQ and QYLD to demonstrate this point.

Dividend-paying stocks can help cushion downside risk while offering consistent returns.

Infrastructure is a core piece of the durable income investor's puzzle. It has the potential to produce high recurrent dividends without NAV erosion. My current challenge is to find picks that produce sufficiently high yields and don't overallocate to the AI-related boom.

BLUF: The accounting loss is visible. The cash-flow buffer is not.

Dividend investing sounds like a dream retirement strategy. However, there is a real dark side to it that many investors overlook and thereby suffer from long-term underperformance. This article details the dark side of dividend investing and how to avoid it.