How to Create Monthly Income With Dividend Paying Stocks

You don't have to wait for quarterly dividend payments if you choose stocks wisely.

You don't have to wait for quarterly dividend payments if you choose stocks wisely.

A lot of stocks pay dividends quarterly. That means you get your money every three months and have to portion it out a little each month until the next dividend payment. You have another choice. Some dividend stocks pay monthly. You can create a portfolio that pays you when you need the money. You may choose from many stocks that make monthly dividend payments. lists over 450.

Create a list of prospects. You can find stocks that pay monthly dividends by searching for “monthly dividends.” A number of reputable online magazines and investment sites list stocks that pay monthly. You don’t have to take these as recommendations. Just put the stocks on your list of possibilities for further consideration. For example, Forbes, Seeking Alpha and all list monthly dividend payers.

Research your dividend stocks. Narrow your list by using research sites such as Yahoo Finance and Google Finance. You can enter the symbol of your stock and get a current quote that shows you the last price at which it traded. Look at financial reports, a chart and analysts’ ratings to choose the stocks that seem most appealing to you. For example, you might choose companies that have made steady dividend payments, have consistently made profits and have low debt. On the other hand, you might choose stocks that pay the highest dividends, no matter what the condition of the company. Establish your own criteria while doing your research, and choose several stocks.

Buy the stocks you have selected. Each stock will have its own dividend payout date, so you won't necessarily receive all of your dividends on the same day of the month. You may find it helpful to create a chart that shows when each stock pays. Your financial research site will allow you to create a watch list of your stocks. Monitor their performance and weed out any that don’t behave the way you want them to. You can replace these by doing new research. Since all of your selections pay monthly, you will have a monthly income for as long as you hold the stocks.


  • Companies that pay a monthly dividend are distributing their profits. That means they're not reinvesting this money in the company. The strain of paying a monthly dividend can cause financial hardship for some companies.

About the Author

Kevin Johnston writes for Ameriprise Financial, the Rutgers University MBA Program and Evan Carmichael. He has written about business, marketing, finance, sales and investing for publications such as "The New York Daily News," "Business Age" and "Nation's Business." He is an instructional designer with credits for companies such as ADP, Standard and Poor's and Bank of America.

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