Close Menu
    Facebook X (Twitter) Instagram
    Facebook X (Twitter) Instagram
    StockNews24StockNews24
    Subscribe
    • Shares
    • News
      • Featured Company
      • News Overview
        • Company news
        • Expert Columns
        • Germany
        • USA
        • Price movements
        • Default values
        • Small caps
        • Business
      • News Search
        • Stock News
        • CFD News
        • Foreign exchange news
        • ETF News
        • Money, Career & Lifestyle News
      • Index News
        • DAX News
        • MDAX News
        • TecDAX News
        • Dow Jones News
        • Eurostoxx News
        • NASDAQ News
        • ATX News
        • S&P 500 News
      • Other Topics
        • Private Finance News
        • Commodity News
        • Certificate News
        • Interest rate news
        • SMI News
        • Nikkei 225 News1
    • Carbon Markets
    • Raw materials
    • Funds
    • Bonds
    • Currency
    • Crypto
    • English
      • العربية
      • 简体中文
      • Nederlands
      • English
      • Français
      • Deutsch
      • Italiano
      • Português
      • Русский
      • Español
    StockNews24StockNews24
    Home » With just £10k in savings, here’s how an investor could target a second income of £750 a month
    News

    With just £10k in savings, here’s how an investor could target a second income of £750 a month

    userBy userJune 3, 2025No Comments3 Mins Read
    Facebook Twitter LinkedIn Telegram Pinterest Tumblr Reddit WhatsApp Email
    Share
    Facebook Twitter LinkedIn Pinterest Email


    Image source: Getty Images

    The most important part of working towards a second income is taking the first step. It may still take years to reach a desired goal, but getting the ball rolling is often the hardest part.

    Many would-be investors spend years saving and saving, thinking of the ideal day when they’ll have enough to start investing. But the truth is, any amount of money’s enough to get started.

    In fact, savings often lose money over time as they fail to beat inflation. So it can be a case of chasing a never-ending goal. When calculating compounding returns over a certain time period, it becomes increasingly evident how important it is to start investing early.

    Imagine an investment of £10,000 into a FTSE 100 tracker with an average 5% return. An investor that started at age 30 would have £57,000 by retirement at 65.

    But an investor who began just 10 years earlier, aged 20, would end up with almost double that!

    second income from investing
    Created on thecalculatorsite.com

    No matter the financial situation, the sooner the better!

    Building a second income with investments

    The key to achieving a second income through investing is with dividends. When an investor has a large enough pot of savings, the dividends alone provide a steady stream of income.

    For example, £750 a month equates to £9,000 a year. Let’s take a conservative approach and assume a decent portfolio can achieve an average 6% yield. That’s how much of the total it pays out annually.

    Nine grand is 6% of £150,000, so that’s how much would be needed. With only £10k, it would take a long time to reach £150k — possibly 40-45 years. Realistically, regular contributions would be needed to speed things up. By adding just £100 a month to the pot, it could reduce the time to 26 years.

    How to construct a portfolio

    There’s two ways to work towards a second income by investing. One option is to aim for a high growth portfolio that achieves an average of 9-10% annual returns. This is possible but risky. Another option is to opt for reliable dividend stocks and reinvest the dividends to maximise growth.

    Such stocks typically see minimal price appreciation, but the reinvested dividends make up for it. I find this approach more successful.

    One under-the-radar example that income-focused investors may want to consider is TPICAP (LSE: TCAP). On first inspection, it might not scream ‘high returns’, particularly as the price is down 22% in the past five years.

    It’s a relatively small brokerage firm but plays a significant role in the UK financial services industry. As one of the world’s largest interdealer brokers, it provides liquidity and trade execution across multiple asset classes, including fixed income, commodities and equities. Notably, it facilitates transactions between major financial institutions, investment banks and asset managers worldwide.

    At the same time, this is its biggest risk, as an economic downturn can hurt the stock.

    Dividend-wise, the 6.2% yield is more than sufficient. Its long-term dividend growth was hindered by Covid but during strong economic periods, it often increased by more than 10% a year. Now at 16.1p per share, it’s the highest it’s ever been.

    When considering income stocks, it’s best to opt for well-established firms in strong industries with good dividend history.



    Source link

    Share this:

    • Click to share on Facebook (Opens in new window) Facebook
    • Click to share on X (Opens in new window) X

    Like this:

    Like Loading...

    Related

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Telegram Email
    Previous ArticleA Boulder-based startup wants to put Colorado at the center of a greener steel industry
    Next Article Japan Urges Domestic Bond Ownership Amid Interest Rate Worries
    user
    • Website

    Related Posts

    FiEE, Inc. Closes Its First Day of Trading on NASDAQ

    June 4, 2025

    First Prize Goes to Pegasystems (NASDAQ:PEGA)

    June 4, 2025

    This Nasdaq-listed company bet $121 million on XRP for treasury

    June 4, 2025
    Add A Comment

    Leave a ReplyCancel reply

    © 2025 StockNews24. Designed by Sujon.

    Type above and press Enter to search. Press Esc to cancel.

    %d