Quick Read
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DGRW and PFFD pay monthly income designed to cover Medicare's gaps, which leave retirees exposed to $1,800 crowns and $6,000 hearing aids.
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JAAA's AAA-rated CLO tranches carry a decades-long zero-default record and pay floating-rate monthly income that rises when short-term rates climb.
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You paid into Medicare your whole working life, and now you find out it does not cover the crown your dentist just quoted at $1,800, the progressive lenses your optometrist ordered, or the hearing aids that run $3,000 to $6,000 a pair. Original Medicare pays for your heart, your hips, and your hospital stays. Your teeth, eyes, and ears are on you. That gap needs a funding plan. Three exchange-traded funds can help build one: WisdomTree U.S. Quality Dividend Growth Fund( NASDAQ:DGRW ) for rising income, Global X Preferred Stock ETF( NYSEARCA:PFFD ) for higher current yield, and Janus Henderson AAA CLO ETF( NYSEARCA:JAAA ) for a steady monthly check that barely moves.
The uncovered dental, vision, and hearing line item is not a one-time hit. It is a recurring bill for the rest of your life, and it climbs with inflation. You need a sleeve of your portfolio that throws off cash every month and keeps up with prices (we rounded up seven of our favorite monthly payers in a free report here). That is exactly what these three funds do, and they do it in different ways so you are not leaning on one engine.
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DGRW: The Raise That Keeps Pace With Your Dentist
DGRW screens U.S. companies for quality metrics like return on equity and earnings growth, then weights them by expected cash dividends. The result is a portfolio built to pay you more over time. The expense ratio is 0.28%, meaning about $9,972 of every $10,000 you invest is actually working for you each year.
And the fund pays monthly. Over the trailing twelve months, DGRW distributed $1.2327 per share, with a chunky year-end special that has shown up like clockwork for years. On top of the cash, the price has done work: DGRW is up 15.38% over the past year and 266.57% over the past decade. That growth matters when your hearing aid replacement in seven years costs more than it does today.
PFFD: Monthly Cash From Preferred Stock
PFFD holds preferred shares issued by big U.S. banks, insurers, utilities, and REITs. Preferreds sit above common stock in the capital stack and pay fixed distributions, so the income tends to be higher than what common shares yield. The fund holds $2.17 billion in net assets across more than 200 positions, with top exposure to Boeing at 4.696%, Hewlett Packard Enterprise at 2.708%, and a deep bench of Wells Fargo, Morgan Stanley, and NextEra Energy issues.
The point here is check size and cadence. Preferred ETFs like PFFD are built to send you a monthly distribution funded by senior income streams from investment-grade issuers. As such, price movement is muted by design. Shares closed at $18.41, up 1.42% over the past year. You are buying this for the income.
JAAA: The Boring Monthly Paycheck
JAAA owns AAA-rated tranches of collateralized loan obligations. In simple terms: the safest slice of pooled corporate loans, floating-rate, with a decades-long history of zero defaults at the AAA level. Top holdings include OCP CLO Ltd at 1.04%, KKR CLO 35 at 1.01%, and Ares LIII CLO at 0.98%, with no single position above 1.04%.
The expense ratio is 0.20%. JAAA paid out $2.487981 per share over the trailing twelve months in twelve monthly installments, and the price barely twitches: up 4.81% over the past year with a one-week move of 0.06%. With the 10-year Treasury sitting at 4.72%, JAAA's floating-rate structure means your income adjusts if short-term rates climb.
The Trade-Off
None of this is without risk. DGRW is still a stock fund, and its price will fall in a real bear market even if the dividend keeps growing. PFFD's preferreds are sensitive to interest rates and to the credit of their issuers, so a sharp rate move or a bank scare will show up in your account value. JAAA is stable, but AAA CLOs are not Treasuries, and its yield could compress if the Fed cuts. The reason to hold all three is that their weak spots do not overlap. Rising rates hurt DGRW's multiple and help JAAA's coupon. A recession would pressure PFFD's bank preferreds but leave DGRW's quality names still writing dividend checks. For a retiree whose dentist, optometrist, and audiologist all send bills Medicare will not touch, that combination is the point.
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