1.Legal & General Group plc
LGGNF (OTC)
Legal & General Group plc stands out as an attractive investment for those seeking reliable income, boasting an impressive 8.32% dividend yield and a remarkable history of nearly 20 years of uninterrupted dividend increases. Despite a slight decline in its five-year return of -2.70%, the company has delivered a robust one-year return of 20.40%, indicating strong recent performance. With a C+ analyst rating, it remains a solid choice for investors focused on dividend-growth from financially healthy companies.
Pros:
- Strong forward dividend yield
- Almost 20 years of uninterrupted dividend increases
Cons:
- Recent negative 5-year return
- Market competition in financial services
2.Taylor Wimpey plc
TWODY (OTC)
Taylor Wimpey plc stands out as a major UK house-builder, appealing to investors with its attractive dividend yield of approximately 8.56%. Despite a recent 1-year return of 2.48% and a challenging 5-year performance of -32.99%, the company's commitment to delivering new homes across Britain remains strong, supported by a solid dividend payout of 4.67 pence as of November 2025. With a "B" rating from analysts, it continues to be a noteworthy option for income-focused investors seeking reliable returns.
Pros:
- Attractive dividend yield
- Established presence in UK housing market
Cons:
- Negative 5-year return
- Market sensitivity to economic conditions
3.City of London Investment Trust
BA69.L (LSE)
The City of London Investment Trust boasts an impressive 59-year history of increasing dividends, with a projected payout of 21.30p per share for 2025, marking a 3.4% rise from the previous year. While the current dividend yield stands at 6.82%, it's important to note the lack of growth in share price, with a one-year return of 0.00%. Analysts maintain a "B" rating, reflecting a cautious outlook, as one projection suggests a decline in share price to 351.00 GBX over the next year.
Pros:
- 59-year streak of rising dividends
- Focus on large, multinational companies
Cons:
- Low recent returns
- Market volatility risk
4.M&G plc
MNG.L (LSE)
M&G plc stands out as a strong asset manager and insurer, offering an attractive dividend yield of approximately 7.98%. With a solid 1-year return of 49.36% and a 5-year return of 56.41%, it appeals to investors seeking reliable income from financially healthy companies. Despite a D+ analyst rating, its consistent payouts make it worth considering for those focused on dividend growth.
Pros:
- Strong recent performance
- High dividend yield
Cons:
- Market volatility risk
- Dependence on asset management sector
5.WPP plc
WPP.L (LSE)
WPP plc stands out as a high-yielding option in the UK market, currently offering a dividend yield of approximately 9.22%. However, investors should note the stock has faced significant challenges, reflected in a 1-year return of -56.11% and a 5-year return of -59.21%. Recent downgrades from analysts, including Morgan Stanley and Exane BNP Paribas, indicate concerns over the company's revenue growth, which has fallen short of expectations.
Pros:
- High dividend yield
- Global advertising presence
Cons:
- Significant recent losses
- Struggles with competition and market changes
6.British American Tobacco plc
BTI (LSE)
British American Tobacco plc presents a compelling investment opportunity with a dividend yield of 5.26%, backed by robust cash flow and a solid track record of consistent payouts. Analysts have a positive outlook, setting a median 12-month price target of $40.00, and the company is projected to grow earnings at 16% annually, making it a strong candidate for investors seeking reliable income and growth.
Pros:
- Strong cash flow
- Established dividend pedigree
Cons:
- Regulatory risks in the tobacco industry
- Market competition from alternative products
Final Words
As you consider your investment options in monthly dividend stocks this January, remember to evaluate the stability and growth potential of each choice. Take time to compare different stocks and conduct your own research to find the best fit for your financial goals.
Frequently Asked Questions
The City of London Investment Trust is a closed-end investment trust focused on providing long-term growth in income and capital through investments in UK equities, particularly large, multinational companies. Established in 1860, it has a notable history of rising dividends.
The City of London Investment Trust reached a dividend of 21.30p per share in 2025, which represents a 3.4% increase from the previous year. The next dividend is scheduled for February 27, 2026.
The current dividend yield of the City of London Investment Trust is approximately 6.82%. This yield reflects the trust's commitment to providing income to its investors.
As of now, the City of London Investment Trust has reported a year-to-date return of 0.00%. This indicates that while it has maintained dividend payments, it has not seen price appreciation in the current market conditions.
Investing in monthly dividend stocks can be risky due to market volatility, changes in interest rates, and company-specific factors that may affect dividend payments. It's crucial to research and understand each stock's fundamentals before investing.
Monthly dividend stocks provide more frequent income, which can be advantageous for investors seeking regular cash flow. However, quarterly dividend stocks may offer higher overall yields, so it's important to consider your financial needs and investment strategy.
