Comparison of rising dividend vs rising stock and sell %If one does the math you will see that it all depends on the rise of a stock each year vs the rise of the dividend and significantly whether you care if an inheritance is wanted for a particular fund.
Of note is a question of when you need the funds: Early part of retirement when you may be travelling and active or later on when things slow down or when you move into a retirement home. If you have a home to sell and enough other funds that you do not depend on this particualr investment pool you could get a smaller income in the beginning just from dividends but a larger amount later as dividends rise. But I may want more income than just the dividends provide in the beginning . So if I want more income in the beginning you might sell a portion of a stock you believe has good prospects to rise each year. For example starting with 10,000 shares and decreasing them by 500 shares each year gives you twenty years of excellent income but no legacy if you do not save some of the income generated. But if the stock is rising each year you greatly offset the loss of the number of shares on which you are earning dividends. I keep one fund that I will decrease to zero over twenty years by selling one 20th of the number of shares if I want more income. So for me a total return concept works great for part of my funds - the other part I want to last as capital so the dividends are more important to keep rising over long periods of time. I am leery of dividends higher than 7% becasue I hav enever found them to be secure.