Social Security Won’t Be Enough. Load Up on These High-Yield ETFs to Avoid a Retirement Income Shortfall

Quick Read

Social Security may only replace about 40% of your pre-retirement paycheck. Most retirees need a lot more money than that for a comfortable lifestyle. It pays to invest in ETFs that can generate a generous, steady income to supplement your Social Security checks. A recent study identified one single habit that doubled Americans’ retirement savings and moved retirement from dream, to reality. Read more here.

Millions of Americans today are eligible for a monthly benefit from Social Security. And unfortunately, a lot of seniors have only those benefits to live on.

But you should know that if you're an average earner, Social Security will only take the place of about 40% of your pre-retirement paycheck. Most seniors need a much larger amount of replacement income to live comfortably, which is why it's important to have access to money outside of those benefits.

If you're in the process of building a retirement portfolio, you may want to focus on ETFs, or exchange-traded funds, that generate a high enough yield to supplement your Social Security checks nicely. Here are some worth considering.

The JPMorgan Equity Premium Income ETF (JEPI)

The JPMorgan Equity Premium Income ETF (JEPI) invests in S&P 500 companies like many other ETFs do. Where JEPI differs is that it also writes call options against it holdings that buyers pay a premium for. That allows JEPI to generate consistent income it can then share with investors.

The JPMorgan Nasdaq Equity Premium Income ETF (JEPQ)

The JPMorgan Nasdaq Equity Premium Income ETF (JEPQ) is similar to JEPI in that it uses a covered call strategy to generate income. However, JEPQ focuses on Nasdaq-100 stocks specifically, giving investors a lot of exposure to tech and growth-oriented businesses. That could be a good or bad thing. JEPQ's strategy could lead to more income and returns, but since Nasdaq stocks can be more volatile, there's more risk involved.

The SPDR Portfolio S&P 500 High Dividend ETF (SPYD)

The SPDR Portfolio S&P 500 High Dividend ETF (SPYD) invests in the top-yielding stocks within the S&P 500. That means you're putting your money into established businesses with a strong history of paying dividends.

The Global X NASDAQ-100 Covered Call ETF (QYLD)

The Global X NASDAQ-100 Covered Call ETF (QYLD) invests in stocks that are part of the NASDAQ-100 index. Like JEPI and JEPQ, QYLD uses a covered call strategy to generate income. This approach provides consistent cash flow, making it a good retirement investment.

The iShares Emerging Markets Dividend ETF (DVYE)

The iShares Emerging Markets Dividend ETF (DVYE) invests in companies that have high dividend yields. But one key distinction from the funds above is that it focuses on emerging markets. Because of this, DVYE may be a riskier investment, though the upside could be worth that tradeoff.

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Don’t just retire on Social Security

If you retire on Social Security only, you might have to seriously cut corners at a time in life when you deserve to be enjoying yourself. It’s a good idea to build a portfolio of ETFs to supplement those benefits in retirement. But make sure to do your research when choosing your funds.

Pay attention to factors such as yields, historic returns, and expense ratios when making your investment decisions, and make sure any fund you choose aligns with your personal tolerance for risk. But with the right portfolio, you can set yourself up with enough income to enjoy retirement to the fullest.

Data Shows One Habit Doubles American’s Savings And Boosts Retirement

Most Americans drastically underestimate how much they need to retire and overestimate how prepared they are. But data shows that people with one habit have more than double the savings of those who don’t.

And no, it’s got nothing to do with increasing your income, savings, clipping coupons, or even cutting back on your lifestyle. It’s much more straightforward (and powerful) than any of that. Frankly, it’s shocking more people don’t adopt the habit given how easy it is.

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