Retired Engineer Living 'Dream' Life Off Dividends Shares His Top 6 Stocks — 'We Generate Enough Income to Travel Full Time' - IBM (NYSE:IBM), Blackrock Floating Rate (NYSE:BGT)

Market volatility triggered by President Donald Trump's tariff announcement on April 2 continues to weigh on US stocks. Investors are turning to dividend stocks to protect their portfolios against uncertainty due to their strong track record during market downturns.

Data shows that the S&P MidCap 400 Dividend Aristocrats index — a group of midcap stocks that have raised their dividends for at least 15 consecutive years — is down 1.74% this year through the end of April, compared with the S&P 500's 4.92% decline during the same period.

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A few days back, someone asked r/Dividends — a community of income investors on Reddit with over 730,000 followers —whether anyone was living their "dream" life off dividends. The question received over 150 comments, with many investors sharing their success stories and portfolios. One response in particular caught our eye.

An investor said he's been living off dividend income for several years after retiring as an engineer at the age of 55. He sold his house and invested the equity in his income portfolio, which has an average yield of about 8%.

"Combined with existing after-tax investments, a pension, and two social security payments, we generate enough income to travel full time," the investor added. "I'm a retired engineer with a love of numbers and a flair for Excel. It's not perfect, but it's been working well for over a decade."

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The investor said in a separate comment that he traveled "extensively" during the first 10 years of his retirement and then shifted to "hyper-travel" mode about nine months ago.

"We currently spend about $20,000 a month on average. We can sustain our travels indefinitely, but anticipate slowing down as we age," he said.

Let's take a look at some of the key stocks and funds in the investor's portfolio based on the details he shared publicly on Reddit.

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PIMCO Dynamic Income Fund

PIMCO Dynamic Income Fund PDI is a high-yield fixed-income fund that invests in debt securities, including mortgage-backed securities and bonds from developed and emerging markets. PDI yields about 14% and pays monthly dividends.

Pimco Income Strategy Fund II

The Pimco Income Strategy Fund PFN generates income by investing in a diversified portfolio of floating and fixed-rate debt instruments. It has a distribution rate of about 12% and pays monthly.

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Barings Participation Investors

The Barings Participation Investors MPV invests in privately placed, below-investment-grade debt directly from issuers, often with equity features. It has a dividend yield of about 8%.

BlackRock Floating Rate Income Trust

The BlackRock Floating Rate Income Trust BGT invests in floating and variable rate instruments of US and non-US issuers, including global floating and variable rate securities. The fund has a dividend yield of about 12%.

IBM

The investor living off dividends said IBM IBM was part of his dividend reinvestment plan. The company has raised its dividends for 30 straight years and has a yield of about 2.6%. Earlier in May, Wedbush reiterated its Outperform rating and $300 price target on IBM following the company's "Think" conference.

Altria Group

Altria Group MO was a high-yield dividend stock in the portfolio. The tobacco giant has a dividend yield of about 7%. The company has raised its payouts consistently for over five decades.

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