I’m in my mid 20’s. I've been maxing out my Roth IRA every year with 90% SWTSX and 10% international markets. Now that I've maxed my Roth, I have 10k to invest so I’ve started investing in the Schwab Dividend ETF (SCHD) in my taxable brokerage account.
Everyone keeps telling me that dividends are irrelevant and that I should focus on total return, I’ve had many people tell me I would pay most of my "gains” as tax at the beginning of every year but my goal is to eventually use the dividends as passive income. I know there’s a potential tax drag on dividends in a taxable account, but is this really a bad strategy? I also started a little side hustle where I tutor students on various medical topics and plan to use that money solely on the SCHD in my taxable brokerage account.
Would I be better off just continuing with SWTSX in my Roth and putting the rest in a HYSA or is it reasonable to prioritize SCHD for the dividend income stream? Looking for insight from those who have been in a similar situation.
Thanks!