One of the common and simple ways is to obtain a second income without working to buy shares in companies that pay profits.

This does not necessarily need to involve the purchase in large numbers of different companies. Some diversification is important as a strategy for risk management, but I believe that the investor can gain a large second income of shares in a handful of carefully chosen blue chip companies.

Speak now, or doubling the future

the FTSE 100 The leading corporate index has a average profit revenue of 3.4 % at the present time.

This is just an average, so I think the investor can really target 5 % return in today’s market while maintaining the laser concentration on the company quality and evaluating participation.

£ 200,000 in such a wallet should produce a second annual income of 10,000 pounds, with profit distributions within months.

Of course, a few people have 200,000 pounds sterling sitting without benefit to that. Therefore, the second approach to the same end can include starting from scratch, preparing regular contributions, and re -investing (vehicle) along the way.

Doing this with 500 pounds each month and assuming the same return by 5 %, within two decades, the wallet will be more than 200,000 pounds. With a rate of 5 %, this would get rid of more than 10,000 pounds annually from the second income – all for 500 pounds per month, starting from now.

Prepare a dealing account

Of course, the investor will need a place to put money (whether it is a cut or as regular contributions), ready to start buying shares.

Therefore, the first useful step is to prepare a stock trading account, trading application, or stock and stocks.

Prepare to buy income shares

The investor also needs to search for the appropriate type of stocks to buy.

Never guarantee profits (and thus the second income). For this reason I said above I think the investor should focus on very high -quality companies with attractive stock prices.

One of the investors who must look with the second income capabilities is the Financial Services Company Legal and public (LSE: Lgin).

Long -term FTSE 100 The member is a well -known company with a long history. This, in addition to the iconic brands and logo, helps them to attract and keep customers.

Legal & General has proven its business model over time, but of course the times can change. One of the risks I see at the present time is that the sale of major insurance business in the United States, although it is positive for the short -term cash flow, can reduce the long -term legal ability and general to generate free cash flows.

The company reduced the growth of the target annual profits per share from 5 % to 2 %. This is still growth, however. The last time the company reduced its profits in the wake of the 2008 financial crisis.

Its return by 8.4 % before the 5 % goal you mentioned above.