Around 75% of the shares I own pay a dividend. I see it as one of the most effective ways to build an extra income. I reinvest the dividend payments I receive back into buying more shares.
The FTSE 100 is home to a number of high-quality companies rewarding investors with handsome yields. Most businesses on the index have been trading for decades, and they have solid business models and plenty of cash flow. When it comes to paying out a dividend, those are all positive signs.
The average yield on the index sits at around 3.6%. However, I’m placing my focus on the highest-paying stocks on the index. Here’s one I like and already own, and one I’d pass up on.
I’m not sold
Shares in telecommunications giant Vodafone (LSE: VOD) look like an absolute steal on paper. At 74.4p, its share price looks dirt cheap. Coupled with that, it has the highest yield on the index at 10.3%. But even so, I’d steer clear of…
