A Beginner’s Guide to Investing for Income: How to Start Building Your Financial Future

Have you been thinking about building your financial future, but don’t know where to start? People invest for a myriad of reasons. Some are keen to achieve goals such as building a nest egg for retirement. Some people may look to their investments to generate a regular income. This latter approach is known as investing for income.

Investing for income is an excellent choice if you are interested in getting a regular sum from your investments, which is supplementary to other payments you might already be receiving. By carefully selecting the best income funds, investors can ensure their hard-earned money is put to effective use by providing steady streams of cash flow on an ongoing basis.

With this beginner’s guide to investing for income, we’ll take you through what it is, how good it really is and finally how to invest in income-producing funds – all from one comprehensive source! Imagine having access to reliable dividends annually or even monthly – now that would make managing your finances much easier!

Let’s look at this approach in greater detail.

What is investing for income?

Simply put, this means generating an income from your investments in order to supplement other regular payments you’re receiving.

This could include bank accounts, stocks and bonds, funds, property, or annuities, all of which are chosen for their potential to deliver a steady stream of income.

There is no need to worry if you are just starting out; anyone can choose to invest for income at any stage of life, according to their personal goals and attitude towards risk.

It might be that you’re retired and want a little extra money on top of your retirement fund to improve your lifestyle. Alternatively, you may be a young family and need an extra source of revenue in addition to your salary.

Whatever the situation, investing for income can help boost your finances without necessarily taking too much risk.

How good is investing for income?


Investing for income can be a great way to boost your finances and create a steady income stream.

It can also help you meet rising costs or ensure that whatever money you have put away is working extra hard for you.

This style of investing should provide you with the regular payments that you need, ensuring that your funds are helping to secure your financial security even in uncertain times.

In addition, efforts such as diversifying across asset classes will ensure that you reap the full potential rewards of a long-term investment strategy.


While investing for income can be an attractive option for those wanting to supplement their retirement funds, as always, there are some potential downsides. For instance, while companies paying meaningful dividends may be well-established and their growth prospects may be limited meaning their share price may not appreciate much in value.

It is worth bearing in mind too, that all investments bear some risk. Individual companies or funds can fail to meet expectations and asset prices can fall in value meaning investors may not reach their income objectives.

So, how to invest for income?

Investing for income is a wonderful way to build up your financial future, and thankfully there are multiple routes that can be taken.

A good entry point is to open a savings account with either a high street or online bank – they tend to offer competitive rates while also being secure and providing easy access to your money.

For those looking to take their investments further, purchasing shares in dividend-paying companies or investing in bonds or property are all great options, as they will all provide you with a regular income stream.

If you prefer an even more diversified approach, managed funds such as equity income funds, fixed income portfolios, multi-asset income funds, and property funds are often the first choice of many.

Equity income funds are particularly popular because of their ability to generate returns above inflation by investing in several dividend-paying companies at once.

Meanwhile, fixed income portfolios invest solely in government and corporate bonds and property funds focus on generating rental income from actual buildings or shares related to properties.