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My approach to generating passive income does not rely on wacky schemes or unproven business ideas.
Instead, I am happy to buy shares in companies with successful business models I think can help them generate spare cash to fund a dividend for shareholders like me.
As an example, if I wanted to target a £1,000 annual passive income right now from a single FTSE 100 share, here is how I would go about it.
Buying the business not the yield
I should start by explaining that I would not put all my stock market investments in one share. That would give me no diversification – and even the best-run company can get into unexpected difficulties on occasion. So, this would be alongside the other existing investments in my Stocks and Shares ISA.
The share I am eyeing is actually one I already own, M&G (LSE MNG).
Something that grabs many people about this share is its juicy dividend yield of 9%. That could mean…
