If you’re a regular reader of StreetAuthority, you know I love getting and reinvesting dividend paychecks. Simply put, my goal is to earn a paycheck every day of the month by owning a basket of solid income securities, then grow the size of those paychecks by harnessing the power of compounding through dividend reinvestment.

So far, the results have been very rewarding. From an initial $200,000 investment, I’m earning $18,613 in dividends a year (more than $1,551 a month) using this strategy. And that doesn’t even include a penny from the healthy capital gains I’ve made from most of my holdings.

But as I said, you may have already heard this before. My goal today is to show you how to get the most out of your income investments using a simple, yet effective, three-part strategy.

I like to think of it as a dividend “trifecta,” and it’s the cornerstone of my Daily Paycheck Retirement Strategy. The great thing about this trifecta is that it’s fully customizable to your own needs. You can use it to multiply your wealth over time, preserve capital, even bring in a second income to fund your retirement.

Here’s how it works…

#-ad_banner-#I have three separate portfolios within my premium advisory, The Daily Paycheck, and each month they work in concert to deliver a reliable stream of income.

To maximize income, the first third of The Daily Paycheck is dedicated exclusively to High-Yielders. I doubt I need to tell you the primary benefit of this elite category, which starts at 7% and go up from there. These stocks average a yield of at least 9% overall, but also include a couple of double-digit gems. This makes them particularly attractive for anyone looking for a large income stream in retirement.

Although these are riskier, I take special care to choose only those securities that offer ample reward for the risk. Many of my high-yield holdings are long-established closed-end funds, specializing in everything from utilities, real estate to convertible bonds.

My Lifetime Income Growers portfolio has the lowest yield of the three portfolios. But what it lacks in income it makes up for by growing their dividends at a fast clip — sometimes doubling them in just a few years. These stocks are perfect if you want a rising stream of income, but also the potential for hefty capital gains in the process.

The Steady Income Generators portfolio is full of dependable dividend-paying securities. I’ve come to think of my Steady Income Generators portfolio as my strategy’s workhorse. I sleep better knowing that no matter what happens in the market, these will likely keep churning out paychecks, day in and day out.

When you own all three types of these income investments, and reinvest the dividends, you can see some pretty dramatic results. I’ve received over $79,578 in dividend paychecks so far. Because I reinvested, my portfolios are now worth over $310,000 — netting a total return of more than 55% since I started in December 2009.

And since the dividends keep flowing in, by the time you read this, these numbers are likely to have grown.

My three portfolios work in concert to minimize volatility and capital risk while maximizing my monthly income.

I’ve now spent more than four years using this strategy. I love its simplicity. My dividends get reinvested every month without me having to lift a finger. The combined portfolios have been roughly 26% less volatile than the overall market. To me, that represents 26% more sleep-filled nights.

But your needs may be different than mine. The good news is that this strategy is fully scalable to any size portfolio and can be easily adjusted.

Because let’s face it, not everyone gets $200,000 thrown in their laps.

Matt Michaels, for instance, is a young father who works at StreetAuthority. He doesn’t have thousands of dollars to invest at the moment. But even so, he and his wife recently began using the Daily Paycheck strategy to build a portfolio for their two young daughters’ future.

At this stage, Matt is focusing on reinvesting the dividends he’ll get from a few key Steady Income Generators — a habit that will set him up to invest thousands more for his daughters in the coming years.

In fact, Matt recently documented, on camera, his first ever high-yield trade. He hopes that by putting his money to work, and by sharing the experience, he can prove that anyone can start a successful low-risk investment plan… no matter how much money you begin with.

In the video, you will see his computer screen and watch precisely how he opened his brokerage account and invests $300 using the dividend “trifecta” I told you about today. So if you’re curious to learn exactly how this strategy works and want to know more about his story, you can watch him take the first steps by clicking the video below.