Want a More Reliable Retirement Paycheck? Use These ETFs to Supplement Your Social Security

There are millions of older Americans who collect a monthly paycheck from Social Security. And for many retirees, that’s really the only guaranteed income they have access to.

But if you’re banking on Social Security as a guaranteed income source, you should know that the program may be creeping closer to sweeping benefit cuts. And while Social Security is not at risk of going away completely, the monthly benefits you may be banking on could end up being smaller than expected.

Even if Social Security isn’t forced to cut benefits, the reality is that you may not be able to live very comfortably on those monthly checks alone. If you earn an average wage before retirement, you can expect Social Security to replace about 40% of it, assuming benefit cuts don’t happen.

But a 60% pay cut could mean having to slash expenses in retirement and live very frugally. That’s not necessarily what you want.

For this reason, it’s important to have reliable income to supplement your Social Security benefits. Here are three ETFs, or exchange-traded funds, that could get the job done.

1. The JPMorgan Equity Premium Income ETF (JEPI)

Like many other funds, JEPI invests in large-cap companies within the S&P 500. But JEPI also takes things a step further by selling call options against its holdings. In doing so, it’s able to generate extra income, which it’s then able to share with investors.

Another nice thing about JEPI is that it pays investors monthly. So if you’re looking for a way to add onto your Social Security checks and cover your ongoing expenses, it could be a good choice.

Plus, the fact that JEPI invests in established companies mitigates your risk to some degree. This isn’t to say that JEPI is a low-risk investment, but it would be fair to classify it as moderate risk.

2. The Invesco S&P 500 High Dividend Low Volatility ETF (SPHD)

If you like the idea of consistent retirement income but don’t want to take on too much investment risk, SPHD could be a good choice. SPHD invests in dividend-paying S&P 500 stocks. So once again, you’re getting established businesses.

But the reason SPHD may carry less risk than other funds is simple. First, it identifies the highest dividend-payers within the S&P 500. But it also then whittles down its holdings to the companies with the lowest volatility, historically speaking.

Plus, like JEPI, SPHD pays investors monthly. So it could be a consistent income stream for you in retirement.

3. The Global X SuperDividend ETF (SDIV)

Unlike the choices above, SDIV doesn’t just invest in U.S. companies. Rather, as the name implies, it invests in high-yielding companies across the globe.

Now you should know that when you invest in international stocks, you increase your risk profile a bit. But because SDIV prioritizes dividend yields, you may find that it serves as a generous supplement to your Social Security checks. And because it pays investors monthly, you can bank on having steady, reliable income to cover your living costs and enjoy more financial breathing room than what you’re likely to get with Social Security alone.