3 Tactics for Lifelong Income
November 18, 2019
Hi, my name is Neil George. I’ve been involved in the financial services industry in one way or another for nearly all of my life.
In 1987, I was recruited by Merrill Lynch International Bank directly from my MBA class at Webster University. I’ve worked as a researcher, asset manager and securities trader.
I went on to manage a fixed-income mutual fund worth over $1 billion.
But before all that, at age 12, I started investing my own money in income-oriented stocks and funds. Those investments have been paying off ever since.
As I got a bit older, I started working on various “side-hustles” that I was passionate about to put some extra cash in my pocket. For example, I’ve always been a fan of cars, especially the fast, expensive ones, so I started my own car-detailing business.
Together with the income from my investments, I was able to save up a solid nest egg that ultimately allowed me to retire in my mid-30s.
I’m telling you this not to brag but to point out a big error that I see a lot of investors make these days.
Rather than focus on generating steady streams of income, many investors these days like to swing for the fences in hopes of hitting a home run.
But the reality is that many investors strike out early on and have nothing to show for it.
That’s not the way to build long-term wealth.
So, in 2002, I retired from the financial services industry to launch my career as a full-time financial writer and analyst.
I am currently the Editor in Chief of Profitable Investing, a leading financial advisory publication that focuses on providing guidance for growth and income investors of all stripes.
As part of my latest venture, I recently published Income for Life, a brand new book that includes 65 income-generating strategies anyone can use to build long-term wealth in any market environment.
I believe so strongly in these income-oriented strategies that I convinced my publisher to give you a free preview of what’s inside.
Below you’ll find three of my favorite chapters from the book that will help you kick-start your way to financial freedom.
I hand-picked these strategies — some mainstream and some off the beaten path — so you can begin building up a stream of steady income right away.
Speaking of things that are off the beaten path, did you know you could be making $100s in extra income just by taking a stroll in the woods?
That’s right! Even if you’re not a fan of mushrooms on your pizza or in general, many folks are, and they’re willing to pay up for them. Join a local mushroom-hunting group and you can start earning big bucks with only a few hours of “work.”
In fact, there are infinite ways to generate extra cash through various side-hustle businesses.
Ever been charged for using an ATM? It sure is annoying if you’re the one using the ATM, but for the ATM owner, they’re laughing all the way to the bank.
Build up a network of enough ATMs and you’ve just built up an extra stream of income that you can use to take a vacation, pay down debt or anything else you might need. I’ve got the full scoop for you below.
If you’re willing to give these income investing strategies a chance, please read on to see how you can start putting hundreds or even thousands of extra dollars into your pocket every month.
All My Best,
Author, Income for Life
Editor, Profitable Investing
The ATM Income Stream
If you’ve gotten this far in the book, your financial IQ is clearly higher than the average American.
That probably means you care almost as much about your outgoing expenses as you do about income.
After all, financial security is built not just on how much you’ve earned… but also on how much you’ve spent.
Folks who are good with money realize this and understand it isn’t just about saying “no” to overpriced coffees or running up credit card debt.
Saving money is also about reading the fine print and avoiding hidden fees.
Right now, you may be rolling your eyes at these obvious facts, wondering how these tired clichés about personal finance have made it into an investing book.
So I’ll cut right to the chase: Those hidden fees are an income-producing gold mine if you’re on the right side of them.
Millions of people don’t have the knowledge about money — or, frankly, the patience — to read the fine print on the most common banking fees. And for better or worse, millions more simply don’t have the means to avoid the expensive realities of the most frequent transaction charges.
I’m talking, of course, about ATM fees.
An ATM is literally a cash factory.
And thanks to the rise of companies that provide machines directly to people like you, there’s no reason you can’t build your own mini banking empire!
How an ATM Empire Adds Up
Anyone who has taken cash out of an ATM outside their personal bank network knows firsthand how these devices can rack up fees in a hurry.
It’s not uncommon for a $20 withdrawal to add on $5 in fees.
That’s a 25% rate of return on your “investment” if you’re the one fronting the cash. That kind of yield is an income investor’s dream!
Now think of the other side of the equation. All you need is the machine to dispense cash and a few thousand dollars in $20 bills to stock it and presto — those “swipe fees” are now yours for the taking!
To the typical consumer, a few dollars per transaction doesn’t even register.
But savvy income investors realize it’s not about the size of the fee but the frequency.
Here’s how you can build your own personal ATM empire and how to make it add up in your favor.
1. Find a good location
Obviously, you can’t just dump an ATM on a street corner and expect it to get used. Ideal locations have a lot of foot traffic and built-in demand for cash.
Think smaller convenience stores that sell lotto tickets or your local coffee shop. And even if things feel right, an ATM needs reliable power and communication with banks to wire over the money — and, of course, surveillance to make sure it’s not at risk of being stolen.
2. Research ATM machines
A quick internet search will give you a host of options to purchase or finance the hardware. Some, like www.atmmoneymachine.com, are all-in-one operations that allow you to lease an ATM for a minimal upfront expense.
Others, like www.atmdepot.com, also offer used or refurbished devices if you don’t desire a fancy new model.
Remember that picking an ATM machine is like buying a car and the right model depends on the “options” you want.
For instance, a brand-new machine with 24-hour tech support and wireless monitoring via your smartphone will be very low maintenance but cost you more upfront. A used model may be cheaper but will require you to visit the location more often.
3. Run the numbers
Let’s say you find a location where you have confidence 10 people each day will use your ATM, generating a surcharge of $2.50 per transaction. That’s $25 a day, or about $750 each month!
So if you buy a machine for $1,500, it theoretically pays for itself in two months. If that sounds attractive, then heck — consider buying two or three. It’s all about your personal finances and cash flow needs.
4. Strike a deal on location before buying
This is the most important part: After the numbers are right and you’re comfortable with your ATM choice, you have to make sure you have a legal right to the space.
Smaller eateries or independent gas stations are often up for anything that makes their lives easier, so they may relish the opportunity to ring up small transactions in cash instead of paying Visa all those credit card fees.
Or you could simply offer a flat rate of $10 a week or $50 a month — a small price to pay if you begin making hundreds if not thousands of dollars a month in fees. Whatever you do, just get that deal in writing.
5. Don’t neglect your ATMs!
The flow of fees will dry up in a hurry if your ATM runs out of cash, so make sure you regularly check in to keep it stocked.
And, of course, make sure that everything is operating as normal and there are no technical issues.
You can save a pretty penny performing your own maintenance, too. So if you’re handy, you may want to spend some downtime watching YouTube videos that address common problems on your ATM of choice. One clip shows how to resolve a glitch on the display of the popular Triton 9100 ATM Machine.
One final note: Unlike some other methods, an ATM empire isn’t a hands-off enterprise. Researching machines and locations requires time, and keeping them running is real work.
However, a quick look at the numbers shows just how powerful this strategy can be.
A network of ATMs generating 100 transactions each day at $5 in fees adds up to $182,500 in your pocket per year!
It may take some time to do it right, but like all things in life, you just need to keep your eyes on the goal and put in the effort.
Those who are entrepreneurial or like tinkering with electronics may not even find it work at all!
And, of course, thumbing through all those stacks of cash every day is sure to make the time go by even faster.
The Best Municipal Bond Bets
On the closed-end municipal (muni) bond front, there are some very attractive opportunities, particularly in three of my favorite discounted closed-end muni bond funds.
To start, buying at a double-digit discount is a great idea for any investor. And by buying into my recommendation of the three funds together, they generate 36 payouts each year, which come from monthly dividend distributions.
But there’s more. Each of them also has a history of paying Christmas bonus checks to shareholders that have been even higher than the regular distributions.
Combined, the average discount to net asset value (NAV) is running at over 12%. The average dividend yield — not counting year-end special distributions — is running at nearly 6%.
Of course, municipal bonds are exempt from federal income tax, and so in order to make investors in the 35% tax bracket the same amount of money after taxes, a taxable bond would have to pay nearly 9%, vastly higher than the average for U.S. Treasuries and high-yield corporates, and of course more than 400% higher than the dividend yield of the S&P 500 Index. (This is often called the taxable-equivalent yield.)
Let me expand on the muni market and why I see further value in the market for current income and appreciation over time along with well-supported credit behind the underlying muni issues.
Municipal bonds are offering some of the best yields for individual investors right now and continue to outperform U.S. Treasuries almost three to one. And specific market and economic developments are providing an immediate opportunity for higher yields and appreciation over the coming quarters.
Municipal bonds have always been a great staple for investors looking for steady and dependable income. With the exemption from federal income tax as well as specific state income tax, municipal bonds offer even better taxable-equivalent yields, particularly for investors in higher income tax brackets, which largely remained intact even after the passage of the Tax Cuts and Jobs Act of 2017.
The general market for municipals had a selloff recently when the impact of the corporate tax cut came into focus. The result is that with lower income tax rates for corporations, from 35% down to 21%, the attraction of municipal bonds to bank and insurance corporations became a bit less. And as these corporations were major owners of municipals as they sought yield, their selling is now providing the deal for you to scoop up.
For many investors who are still paying Uncle Sam a 35% income tax rate, the allure and the advantages of municipals haven’t changed one bit.
As I said above, the best way to get the most from the immediate opportunity is to buy three closed-end municipal investment funds right now. Each is selling at a discount to their liquidation value, and they pay an average taxable-equivalent yield of near 8%. I’ve followed and recommended these collectively for the diversity in their holdings across the U.S. and how they tend to work well together in reducing month-to-month price volatility.
Look to buy the BlackRock Municipal Income Trust II (BLE). This is a value-focused municipal fund that’s at a discount to its net asset value. It yields about 5%, which equates to an even better taxable-equivalent yield.
Then add the Nuveen Municipal Credit Income Fund (NZF). This fund focuses on maintaining steady higher yields and is trading at a discount to net asset value as well. It yields over 5%, making for an even greater taxable-equivalent yield.
And to round out our basket of municipal bonds, buy the Nuveen AMT-Free Municipal Credit Income Fund (NVG). This fund has the particular added benefit beyond the focus on current income, as it buys municipal bonds that are exempt from the Alternative Minimum Tax (AMT) that can hit higher-income taxpayers. It is trading at a discount to net asset value and has a yield of over 5%, as well, which means after tax it yields closer to 8%.
In addition, as I noted above, these yields do not include the Christmas bonus payouts, which further boost the returns.
Why the Discounts?
Closed-end funds come to the market in initial public offerings (IPOs), just like stocks. Fund companies make their pitches, sell shares and raise a set amount of capital to invest. This allows fund managers to avoid the fund churn that plagues open-end funds, which have to deal with daily inflows and outflows (and therefore redemptions) of investment.
Closed-end investors get stability and cost savings, and management can afford to take a longer view on the market. Closed-end funds also can use leverage to better manage portfolios via varied approaches, including issuing preferred shares.
Just like common stocks, closed-end funds will be valued at premiums or discounts to book value (or net asset value). But closed-end funds are cleaner in how book is valued, unlike common stocks that can and do use varied accounting schemes that can muddle reported book values.
Closed-end funds just total up their holdings’ market prices and subtract liabilities to pop out the NAV, which is easy for individual investors to see.
The bottom line is that at the current discounts, these three funds are all at huge margins that haven’t been seen since the liquidation of the markets in the fourth quarter of 2008. With average discounts for the past 10 years at a mere 1% or so, the current discounts are way cheap.
This buys a lot of downside protection for the stock prices, even if I’m wrong for a while on closing the discount margins. And investors will get large monthly tax-free dividends along the way.
The Fantastic Fungi Cash Machine
Like everyone else, I am incredibly reliant on mobile technology. Google Maps is a lifesaver when it comes to finding new restaurants, and having a video chat with distant relatives helps me feel connected to my family no matter where they are.
But while there’s a lot of value in smartphones, many of us relish the chance to unplug — if only for an hour or two!
There’s a lot to be said for a quiet walk in the woods, breathing in the fresh air and listening to the rustle of the leaves and bird songs overhead.
And if you can get away from it all and make a few thousand bucks in the process… all the better!
It may sound too good to be true.
And when I give you all the details, it may even sound too absurd to be true.
But believe me when I say that there is a lot of money to be made by outdoorsy types who know their way around the woods and have a keen eye.
It’s a kind of backwoods treasure hunting, and can generate thousands of dollars in annual income — sometimes simply with only a few hours work!
I’m talking about foraging for mushrooms.
Before you write me off as a crazy person, hear me out.
Better yet, hear it firsthand from a guy who forages for wild mushrooms and regularly takes home four figures a season.
In a piece published in Forbes, Frank Hyman talked about his trips into the woods each fall to harvest maitake, chicken of the woods and lion’s mane edible mushrooms. “Foraging sporadically between Columbus Day and Thanksgiving, I harvested about 120 pounds,” Hyman said.
The mushrooms commanded $12 to $25 a pound — good for some $3,000 in just a few weeks’ work!
And lest you think this is backbreaking labor, hunching over day after day as you gather fistfuls of tiny brown things, keep in mind that the choice fungi used by top-level chefs grow in large, meaty mushrooms.
That means only a few dozen mushrooms in total to generate that kind of income.
“A single five-pound ‘chicken of the woods’ mushroom is bigger than a loaf of bread and could earn you $100,” Hyman said in Forbes.
How to Hunt for Mushroom Treasures in Your Neck of the Woods
I so love a chicken of the woods mushroom. And I make a fabulous risotto with a variety of mushrooms and truffles.
If you’ve looked around and noticed all the kale and ancient grains and avocado toast on restaurant menus, it’s clear that eating habits are changing — particularly among younger Americans with money to burn.
So, why not cash in on this trend, if you’re the outdoorsy type?
Presuming you’re not grossed out by the prospect of carrying dozens of pounds of mushrooms through a gloomy forest on a misty evening, here’s how you can get started in this odd but often lucrative hobby:
Get a guide to learn your local fungi: There are a host of illustrated guides out there to help you, exhaustively outlining just what mushrooms are safe to consume and how to identify them.
Good guides also give you a more precise sense of what grows where and when, and are a must-have to avoid harmful varieties of mushrooms.
Look for local mushroom groups: Many communities have mushroom lovers that organize in a group and offer educational nature walks. I’ve participated in some of these in the Washington, D.C. region. In this digital age, many of them have Facebook pages and websites, too!
The Morel Mushroom Hunting Club (morelmushroomhunting.com) is dedicated to fans of a specific variety of mushroom. There is also a host of regional mycological associations (“mycology” is the study of fungi) cataloged on the North American Mycological Association’s website (namyco.org).
This kind of expert-led education will ensure you make the most of your time in the woods.
Identify your favorites: Most mushroom hunters zero in on just a few species rather than run around the woods looking for everything.
Every environment is different, and you’ll soon find some mushrooms are more abundant than others and learn where they thrive, what they look like and even how they smell.
Finding a few target fungi is the best way to make the most of your time in the woods.
Connect with buyers: The last link in the chain, of course, is finding someone to take all that fungus off your hands!
Now, you can’t just go to your local chain restaurant and expect them to write a check. And in some states, you may need a licensed mushroom identification expert to verify your finds before sale.
But the “farm to table” movement is alive and well in just about every community, and I’m sure you know some local restaurants that would love to say they have locally sourced mushrooms on their menus.
If you don’t want to rely on just one or two chefs, then also consider a local farmer’s market where you can set up a booth and sell mushrooms at premium retail prices.
There are admittedly better regions for mushroom foraging than others, and this is not a hobby for those who like the creature comforts of civilization.
If you live in a desert like Tucson or Las Vegas, or if tripping over roots on a muddy forest path sounds like a terrible way to spend an evening, this is clearly not an idea for you.
But it’s easy to understand how people get hooked.
It’s like an adult version of hunting for Easter eggs or buried pirate treasure!
As I said, I’m a fan of mushrooms, so the idea of making money simply by taking a hike away from the hustle and bustle of daily life is incredibly appealing to me.
Most edible mushroom species emerge in fall, from the end of September through Thanksgiving, which is my favorite time of year.
The weather is cool, the leaves are turning…
… if you can take all that in and make a few bucks at the same time, that sounds like a perfect way to spend an afternoon!
I hope you’ve found these income ideas valuable. As you can see, each of these secrets can enable you to stop worrying about money and allow you to enjoy the sort of life you’ve always dreamed of.
But I’ve given you just three of my secrets, you see, I’ve recently published a book called Income for Life: 65 Income Streams ANYONE Can Collect to prove one simple concept…
Creating lasting wealth doesn’t have to involve working long hours and making enormous sacrifices.
The key is to work SMARTER!
And I’ve put all the resources you’ll need in my new book. Using the secrets you’ll find inside this book, you’ll be able to quickly and easily set up multiple streams of income that can pay you for life. So you won’t have to worry about paying bills… or scrounging to buy the grandkids birthday presents when you retire.
It doesn’t matter how much money you currently have. All that matters is how much you’re willing to make.
Look, I’ve made it my personal mission to help as many folks as I can to turbocharge their personal finances. And I’ve certainly made my money with these secrets… now it’s your turn.
That’s why I want to send you this book, Income for Life, absolutely free today.
But there is one small catch…
Supplies of Income for Life are limited… and we’re giving them away on a first-come basis.
So if you’re truly interested, don’t wait. You won’t find this book on Amazon.com, Barnes & Noble or at your local book store. They’re only available through this offer.
So remember to click the “Reserve Now” button at the bottom of your screen.
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