$450 Invested Monthly in This ETF Can Pay Your Rent in Retirement

You're targeting retirement in 25 short years and you don't own a home. The quandary is, should you buy a home so that someday you can do away with the cost of rent? Or should you focus solely on saving for retirement, even if it means you'll pay rent for the rest of your life?

Fortunately, there is a middle ground. It involves forgoing the home purchase and directing your excess cash into a dividend fund. The goal is to rely on those dividends to generate enough cash to cover your rent expense in retirement. Using this strategy, you can keep a roof over your head without liquidating positions. That reduces your exposure to short-term market volatility, because you don't have to sell something each month to fund your rent. It also protects your earnings power going forward.

Image Source: Getty Images

Source Fool.com