Dividend-paying stocks have long been a way for investors to earn income, but the recent dividend cut may have some people concerned about what to do next. On Wednesday, Intel announced that it would cut its dividend by nearly 66%, to 12.5 cents per share from 36.5 cents. The new annual dividend yield is 4.20%, down from 7.13%. The latest dividend paid on June 1 to shareholders was recorded on May 7. Intel’s move comes after VF Corp cut its dividend by 41% to 30 cents from 51 cents at the beginning of the month. this, making it excluded from the S&P 500 Nobility Index Dividend. This index includes stocks that have increased their dividends in each of the past 25 years or more. Companies say the cuts aim to best position them to create long-term value. Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, said: “However, the recent declines have been unusual. Over the past 12 months, through January 31, five companies in the S&P 500 have reduced their dividends, while 362 have increased their dividends, he said. In fact, the dividend “will easily set a record this year,” Silverblatt said. He predicts the cash in investors’ pockets will grow about 5% to 6%, even if Intel cuts back. In 2022, U.S. conventional dividend growth increased 5% to $82.5 billion from $78.6 billion in 2021, S&P Dow Jones Index data shows. Certified financial planner Jamie says the drop has grown 63% to $14.3 billion in 2022 from $8.8 billion in 2021. The company’s dividend is just one source income and that income should only be one part of your overall portfolio. Hopkins, wealth solutions managing partner at Carson Group. “When you’re looking at the return on your investments, you should consider all the sources available – CD ladders, bond ladders, dividend-paying stocks, and other fixed-income products like annuities — and figure out the cheapest way to buy that income,” he said. When looking for dividend stocks, history can be a guide. “Companies that tend to grow over time don’t cut them down much during a recession,” says Hopkins. However, as recent cuts by VF Corp and Intel show, past performance does not guarantee future results. Some dividend sectors are more sensitive to earnings and therefore more susceptible to a downside correction, UBS wrote in a note Wednesday. These include finance, real estate, media and entertainment, and technology hardware and equipment, the company said. According to UBS, sectors with less cyclical dividends than earnings include energy, healthcare equipment and services, semiconductors and transportation. Grant suggests looking at utility stocks, which often pay pretty good dividends. Preferred stocks and real estate investment trusts are other areas to consider, he said, although there could be some volatility. Dividend Funds Another option is an exchange-traded fund that includes dividend stocks. All types of funds are available, from those that track the S&P 500 Dividend Aristocrat Index to high-yield funds. There are also funds that stick to a certain sector, such as utilities. However, not all will cut the stock if the company cuts its dividend. Therefore, if income is your goal, look for people who focus on names with a history of increasing dividends. “Generally speaking, companies that have raised their dividend five to six years in a row, it’s part of their culture,” Silverblatt said. “It’s in their cash flow.” The SPDR S&P Global Dividend ETF, for example, consists of 100 high-yield stocks and measures the performance of the S&P 500 Dividend Aristocrat Index. It currently has a dividend yield of 5. .14%, according to FactSet. Year-to-date performance for the WDIV YTD mountain SPDR S&P Global Dividend ETF The ProShares S&P 500 Dividend Aristocrats ETF, which also tracks the index. Equally weighted holdings and ETFs are rebalanced at the same time as the index. It currently has a dividend yield of 2.42%, according to FactSet. For Mike Moray, chief investment officer at Integrity Viking Funds, dividend growth history is the primary metric his team uses when deciding to keep the name in their Dividend Harvest Fund. He said there have been two times since the fund’s inception in 2012, companies have been scrapped for dividend cuts. The fund’s managers try to be proactive in evaluating companies, which means that some companies are eliminated before they reduce their dividends. “We’re not 100% immune yet,” Morey said. “Strong free cash flow and a history of consecutive dividend increases have made us a lot more secure in the face of a dividend cut.” Ladder Bonds and CDs Another way to earn income is through bonds, which have high interest rates. The 10-year Treasury yield hit its highest since November on Tuesday, trading short-term at 3.95%. One strategy to capture that income and manage interest rate risk is to build a bond ladder with different maturities. As each issue matures, you can decide to reinvest the proceeds into new bonds. CFP Don Grant, Saber Wealth’s investment advisor, says the same can be done with certificates of deposit or CDs. Interest rates on CDs could hit 5.5% this year, Morgan Stanley recently predicted. However, don’t just go to your local bank. Instead, shop nationally through a broker or online, Grant advises. “Different regions will pay different rates based on the need for money and real estate in their area,” he said. Depending on your income needs, he suggests a ladder from 3-month to two-year CDs. Annuities Buying an annuity issued by an insurance company can also provide income. Just pay attention to fees, Grant advises. A fixed index annuity links its potential returns to market indexes. A multi-year guaranteed annuity, or MYGA, provides a guaranteed fixed interest rate for a specified period of time. “They are paying pretty well right now,” said Hopkins of the Carson Group. Make some profit If you need cash, there’s nothing wrong with making some profit, says Grant. “Let’s say you have some stocks that appreciate. Go ahead and sell some of them and take what you make,” he said. “Deprived of some growth. Use it as income.” – Michael Bloom of CNBC contributed reporting.