The federal government is likely to shut down soon.
Congress is having trouble passing the bills needed to keep the lights on past October 1.
Every year, Congress has to pass 12 appropriations bills that set the budget for government discretionary spending.
That includes spending on defense, education, transportation, healthcare, homeland security, science, and diplomacy.
If Congress doesn’t pass a budget, all federal agencies have to stop non-essential activities until they get funding.
That means businesses can’t get permits, licenses, or approvals for new products. Banks can’t get the information they need to approve loans. Hundreds of thousands of federal employees lose their income.
Right now, a small group of congressmen are refusing to pass the appropriations bills. They want to cut spending. But they can’t find a deal that they’re willing to support.
Here at the Intelligent Income Daily, we’re focused on finding the safest income investments on the market. A government shutdown causes a lot of problems for the economy. But there’s one agency that stays open even when the rest of the government shuts down…
Today I want to show you how to collect a safe high yield from a company that caters to this shutdown-proof part of the government.
The Federal Government Agency That Won’t Shutdown
The U.S. Postal Service (USPS) is a government agency that is an essential part of the economy. It is responsible for delivering nearly 40% of the packages from online sales.
And the U.S. Postal Service is the oldest federal agency. It was formed in 1775 during the Second Continental Congress, with Benjamin Franklin as the first postmaster general.
In the nearly two and a half centuries of its existence, the U.S. Postal Service has been a vital network connecting Americans across the country. Despite being a government agency, the U.S. Postal Service doesn’t cost taxpayers anything – it’s entirely self-funded through sales of stamps and postage.
That means the U.S. Postal Service keeps working even when the rest of the government shuts down.
So how do you collect a safe high-yield income from this shutdown-proof government agency?
How to Collect a Safe High Yield from the U.S. Postal Service
Let me introduce you to Postal Realty (PSTL).
Postal Realty is a real estate investment trust (REIT) that focuses on buying and leasing post offices. That means they have one of the most reliable streams of rental income from the government itself.
And as a REIT, Postal Realty is required by law to share 90% of its taxable income with its shareholders through dividends.
Though Postal Realty is lumped into the category of office REITs, its buildings function more like industrial properties as part of one of the nation’s largest logistics networks.
And, post offices are more than just places to drop off or pick up mail. They are also important community centers and often provide other government services such as renewing driver’s licenses and passports.
That means that they are more likely to keep the lights on – and keep paying rent – even in the tough times.
Postal Realty has an impressive 99.7% occupancy rate and has retained 99% of its leases that have come up for renewal.
Although a relatively young REIT (it went public just four years ago in 2019), it already has a solid track record of increasing its dividend every year.
And Postal Realty has a long runway for growth with its specialized niche in post offices.
The company currently owns just 1,375 postal properties, which makes up about 6% of the space that the U.S. Postal Service leases across the nation. That means it has plenty of opportunities to buy more post offices.
And with an attractive 7% yield, Postal Realty’s shares are trading at 13.2x adjusted funds from operations (AFFO).
AFFO is a financial metric that tells shareholders how much cash a REIT has available for distribution to shareholders.
Postal Realty has historically traded at an average of 16.6x AFFO. So right now you can buy shares at a 20% discount.
That means it’s a great time to add this high-yield REIT to your portfolio and hedge against the upcoming government shutdown.
Now is the time to take advantage of this opportunity.
Happy SWAN (sleep well at night) investing,
Brad Thomas
Editor, Intelligent Income Daily
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