Looking to boost your savings with a second income in 2026? Here's a unique strategy for those with £20,000 in excess savings. While Cash ISAs have been a popular choice in the past, the changing landscape of interest rates and contribution limits means it's time to explore alternative options. The Bank of England's recent interest rate cut signals a shift in savings returns, prompting investors to seek new avenues for income generation. One promising avenue is the stock market, where companies distribute profits to shareholders as dividends. By investing in dividend-paying stocks, you can participate in this lucrative distribution model. The key is to identify stocks with attractive dividend yields, even as cash returns decline. For instance, Primary Health Properties (LSE: PHP) offers a 7.52% dividend yield, making it an intriguing option. As a real estate investment trust (REIT), it owns a portfolio of GP surgeries, benefiting from high occupancy rates and a stable tenant in the NHS. While the recent merger deal with Assura adds short-term debt risk, the long-term prospects are promising, with the combined business poised for a strong competitive position and a likely sustained dividend payout. This strategy of investing in REITs for passive income is an appealing alternative to traditional buy-to-let properties, offering a hands-off approach to generating a second income from your excess savings.
