How To Build A Better 5 Percent Income Fund

I know a way investors can build a simple, diversified, ultra low-cost stock portfolio that pays 5.08 percent annually with no taxes on part of the income. Forget the expensive dividend funds that were dogs in 2012. The iShares High Dividend ETF (HDV), for instance, yielded only 3.38 percent and had a total return (including stock appreciation) of only 9.67 percent in 2012. Compare that to the build-your-own income strategy which yielded 16.45 percent.