Procrastination is a silent and slow killer of savings. Everyone puts things off, of course, waiting until the last minute and then scurrying to finish a longstanding to-do list. Taken to extremes, this course pulverizes your long-term financial plans.
Dividends and interest are the two major types of income investors can receive. The distinction between dividends and interest is determined by what type or classification of investment pays the income. Dividends and interest also have different tax consequences for both the receiving parties and the paying entities.
Types of Dividends. 1  Ordinary Dividends. Dividends paid out from a companyâs earnings and profits are referred to as ordinary dividends. They are taxed at normal income tax rates. Many real estate investment trusts (REITs), for example, pay out ordinary dividends, which can raise your overall tax burden.