With inflation still clocking in around 40 year highs, more retirees are looking for ways to boost their incomes. Dividends stocks look tempting, as a strong dividend-paying company can potentially boost what it offers to its shareholders faster than inflation.

The flip side, unfortunately, is that dividends are never guaranteed payments. When a company is forced to cut its dividend, its share price often drops along with it. That's a double gut punch. After all, not only do you lose the income, but you also lose a bunch of the capital that you otherwise could have used to buy other dividend paying stocks with more solid foundations.

That risk is what makes dividend-focused ETFs a worthwhile tool for your consideration. With a broad enough base of companies in the ETF, the loss of any one company's dividend won't have quite as dramatic an effect as it would have had in a more concentrated portfolio. With that in mind, these three dividend ETFs could very well turn out to be a retiree's best friend.

Continue reading

Source Fool.com