Image source: Getty Images <\/p>\n
A great way to generate a long-term passive income in retirement is to build a portfolio of\u00a0FTSE 100 shares offering both dividends and growth.<\/p>\n
Investors can do this inside a Stocks and Shares ISA, a Self-Invested Personal Pension (SIPP), or a mix of both. I\u2019m on the hunt for companies that can deliver a reliable income stream for years, ideally decades.<\/p>\n
I asked ChatGPT to list five \u2018forever\u2019 income stocks. I\u2019d never rely on a chatbot to pick shares for my portfolio, but it\u2019s fun to test them. Here\u2019s what it said.<\/p>\n
\u201cReliable income stocks need solid cash flows, ideally from essential services or products. They also need strong balance sheets with manageable debt and a record of consistent dividend payments.\u201d<\/p>\n
Can\u2019t argue with that. ChatGPT\u2019s first pick surprised me: business-to-business supplier Bunzl. Hardly the most prominent dividend stock. Then I remembered why. I recently bought Bunzl myself, and ChatGPT knows that. It\u2019s feeding my own interests back to me, as AI systems often do. Still, having increased its dividend annually for more than 30 years, and available at a reduced price with the shares down 33% in a year, I can\u2019t argue with Bunzl.<\/p>\n
The next pick felt inevitable: utility giant\u00a0National Grid (LSE: NG). Many see it as the perfect income stock, typically yielding between 4% and 5%, with regulated earnings and a solid history of share price growth.<\/p>\n
Yet I wouldn\u2019t buy it personally. It has to pour vast sums, up to \u00a360bn, into preparing the electricity grid for the green energy transition. That\u2019s an enormous burden, and if costs overrun it may need to raise more money from shareholders, risking dilution, or even trim the dividend.<\/p>\n
Perhaps I\u2019m being too negative. Its half-year results published on 2 October were in line with expectations, as they often are, and it has a brilliant long-term income record. National Grid\u2019s role is fundamental to the nation\u2019s energy infrastructure.<\/p>\n
But my doubts highlight why investors shouldn\u2019t blindly rely on AI to pick stocks for them. Machines struggle to weigh up the human factors such as caution, patience, risk appetite and personal experience, that shape successful real-world investing.<\/p>\n
Cigarette maker British American Tobacco is one of the most reliable dividend payers, with a trailing yield of 5.9%. No surprise ChatGPT plumped for that. The shares have climbed 45% in a year. This should be a good long-term buy-and-hold to consider but recent growth is likely to fade.<\/p>\n
ChatGPTs final two stocks \u2014\u00a0Aviva\u00a0and\u00a0Legal & General Group\u00a0\u2014 are both strong income plays. Aviva is up 48% in a year and yields 5.36%, while Legal & General is up a modest 9.5% but pays a mighty 8.86% income. I like both, but I won\u2019t hold them together in a five-stock portfolio as it\u2019s too much concentration as both are in the same sector, financials. So that\u2019s something else ChatGPT has suggested that I won\u2019t do.<\/p>\n","protected":false},"excerpt":{"rendered":"Image source: Getty Images A great way to generate a long-term passive income in retirement is to build…\n","protected":false},"author":2,"featured_media":117549,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[83307,138,246,83306,83308,83305,111,139,69,24672,244,245,31351],"class_list":{"0":"post-117548","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-bunzl","9":"tag-business","10":"tag-finance","11":"tag-income-stock","12":"tag-income-stocks","13":"tag-national-grid","14":"tag-new-zealand","15":"tag-newzealand","16":"tag-nz","17":"tag-passive-income","18":"tag-personal-finance","19":"tag-personalfinance","20":"tag-stocks-and-shares-isa"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/117548","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=117548"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/117548\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/117549"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=117548"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=117548"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=117548"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}