The Power of Dividends

June 10, 2022
Why choose dividends? Find out why dividends can be a smart option for generating income, and can potentially offer even more value over time than returns alone.

Generating income is a universal challenge that impacts most investors—And while the first investment you may think of for income is bonds, dividend-paying equities are a smart option for generating income today.


Not only can they be a great choice during retirement, dividends can also help provide the portfolio growth and support you need to get to retirement. In fact, reinvestment of dividends is responsible for the majority of the stock market’s return since 1926.


Additionally, dividends have historically outperformed inflation—helping to protect your purchasing power over time.


Dividends also tend to outperform during down markets—and studies have shown that losing less on the downside may be more important to your portfolio value over time than your average annual returns.


Today, more companies are paying dividends and in larger amounts than ever before. In fact, many companies increase their dividends over time, providing a potentially growing stream of income.


Dividends can actually be found all over the world, in every country—and in every sector—providing you with global opportunities for income.


Dividends are an objective measure of a company’s health and profitability. And, they can help retirees to grow capital, keep up with inflation, outperform during down markets and gain a potentially growing stream of income.


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