Week 6: All about the dividends

When I first starting delving into stocks, I looked for companies that had strong upward momentum. Now that I’ve settled into the market a little more and spent time watching many different companies over time, I’ve seen that there are other possibilities for lucrative investment strategies.

Companies with stocks that aren’t making the headlines every week, but maintain a strong foundation and pay a regular dividend to shareholders make for great long terms investments.

Take a stock like AT&T (T) for example:

Their stock has sat in a comfortable range for decades, throughout that time consistently paying a growing dividend rate (currently at 5.95%).

What’s really neat about stocks that pay dividends is that even when the market makes a bearish turn, you’re still going to be paid out with your regular dividend. When you really look at a solid company like this in the long term, even years of economic struggle like 2008, left a relatively minor dent in the stocks overall trend. And, for everyone who held on, the market corrected and got everyone back on the right track.

It’s a much more conservative method to investing, not looking for huge gains in the short term, but instead a regular payment over a long period of time.

Imagine if you had several investments in stocks that paid dividends. Twenty+ years later, your earnings from the dividends could help supplement your income when you’re at retirement age. Goals.

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