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Solid Investments for Retirement
As investors approach their retirement years it is important to modify their investment portfolio. Risky growth stocks may provide impressive earnings for a younger investor. But a retiree cannot bear the risk of losing part of their portfolio just when they need it the most. Solid investments for retirement should always include dividend stocks but more importantly stocks with long term intrinsic value. Here are a few thoughts on the subject.
Investments for Income in Retirement
A substantial part of any investment portfolio in retirement is typically in dividend stocks. While a person may have reinvested dividends over the years, they will typically take the dividends during retirement. Well-chosen companies with dividend stocks have been paying dividends for decades and steadily increasing the dividends as well. The ability to keep doing this is a measure of the financial health of such an investment.
Healthy dividend-paying companies are not growing rapidly but are generating healthy profits. Passing these on to the stockholder is a way of making up for slowed growth. Some of the highest and most reliable dividends come from utilities which have slow growth, are stable and are financially solvent.
Companies that have been paying dividends for more than a century include the likes of Coca Cola, Exxon Mobile, Procter & Gamble, Colgate Palmolive, and Eli Lilly and Company.