There are many ways to invest in the stock market, and not all of them are effective. One of the best (and also one of the safest) strategies is to invest in solid companies that have steadily increased their dividends since 10, 20, 30 and for some even for more than 50 years in a row. This strategy has been successfully implemented for years in the United States by investors of all ages, whether for the purpose of obtaining additional income for retirement or for achieving financial independence.
These exceptional actions are often titled as “dividend aristocrats” or “dividend champions”. We will see in detail in this article why investing in growing dividend stocks is probably the best stock market investment strategy for a particular investor.
Dividend-paying stocks offer historically higher returns than those that don’t. For proof, here is a graph illustrating the performance of these stocks between 1987 and 2015. You can see in green the “growers”, i.e. companies that have increased their dividends each year, and in dark blue the “payers”, i.e. companies that pay regular dividends (without necessarily increasing them). These two categories of stocks have a much higher performance than “Non-payers” (companies that don’t pay dividends) and “cutters” (companies that for one reason or another remove or decrease dividends paid). In terms of yield, just feel it with your open eyes. ...CONTINUE READING