Why Dividend Growth Stocks Should Be Part of Your Retirement Plan

If you are saving for retirement, you should aim to include not just any dividend stocks, but stocks that regularly increase their payouts over time. They can add some important stability to your portfolio as they are normally safe businesses to hold and can pay off in the long haul -- just through their dividend payments.

Here's how the passive income you collect from these types of stocks can grow over time.

The real value in a dividend growth stock is that over the years, your dividend income can be much higher than it is today. For example, a company that increases its dividend payment by 5% each year for 25 years will have increased its dividend income by nearly 240%, more than three times what it is paying today.

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Source Fool.com