Since I first started investing in the stock market, I've had an addiction to dividend paying stocks.  I love watching my money grow, but I love even more to see little paychecks come in while I'm doing something else.

"Because you own shares, AT&T paid you $45".

You could be hiking somewhere.  Out with friends.  And still get that notification that you made money.

It's perhaps one of the most passive forms of income. 

Dividends, if you don't know, is extra cash that is paid to shareholders of a stock (often yearly or quarterly). 

Not ALL stocks pay dividends.  Some stocks simply use all their money for the operation of the business (and to pay their workers, CEO, etc.).  I personally prefer to own a majority of stocks that pay dividends. I've seen companies waste money on bonuses for the CEO, etc.  And I'd just prefer I get a paycheck either way.

Dividend yield is the percentage of the share price paid out by the stock every year.  For example, AT&Ts share price is $28.99.  The dividend yield is currently 7.21%.  That means owning one share pays out about $2.09 every year.  Since it pays a quarterly dividend, that's $0.52 every quarter ($0.52 x 4 = $2.09).  

If you like dividend stocks like me, you'll REALLY like monthly dividend stocks.

Instead of paying out dividends once a quarter, they pay them every month.  The yield is the same for the total year, but instead of getting it in four payments, you get it in twelve.  For example, IF that same above stock was a monthly dividend payer, you'd get twelve payments of $0.17 for every share you own.

Monthly dividends let the money compound a little faster, and give you the option of selling sooner if you'd like because you get more frequent dividend payments.  Selling a stock just before the dividend is set to pay is never fun.

So what are some of my favorite monthly dividend stocks?  Here are a few (NOT investment advice, do your own Due Diligence):

• $STAG:  STAG Industrial is Real Estate Investment Trust that owns single tenant industrial properties.  It's based in the US.  Current yield:  4.65%.
• $O:  O Realty.  Another Real Estate Investment Trust.  It owns rental property (mostly commercial like gyms, restaurants, movie theaters).  Current yield:  4.74%.
• $MAIN:  This is a business development company.  It mostly services middle market companies with finance related issues. Current yield:  7.53%.
• $QYLD:  One of the most interesting on this list.  It runs a covered call options strategy on the NASDAQ index to generate income.  Current yield:  11.12%.
• $SDIV:  Global X SuperDividend ETF.  A collection of high dividend paying stocks from US to international.  Current yield:  8.96%.
• $LAND:  Gladstone Land.  This is a Real Estate Investment Trust that owns farmland and farm related properties. Current yield:  3.29%.
• $GAIN:  Gladstone Investment.  A management company that invests in the debt of other companies to generate income.  Current yield: 7.73%.
• $SDEM:  Global X MSCI SuperDividend Emerging Markets.  This ETF tracks an index of 50 companies throughout emerging markets that pay a dividend.  Emerging markets can include countries like China, Mexico, Korea, South Africa, and many others outside the US.  Current Yield: 6.09%.

Note:  From the above, the ETFs ($QYLD, $SDIV, and $SDEM) have expense ratios that cut from the yield somewhat.  An expense ratio is the fee an index fund or ETF will charge to operate.  Some are small (like Vanguard funds) and only charge below a half a percent.  Others are more expense and can extend to a full percentage point or more.  Pay attention to these as they eat into your gains/income.

I own a position in each of the above.  Some I plan to hold for along time.

Are you a fan of monthly dividend paying stocks?  Which are your favorite?