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3 Top Dividend Stocks to Maximize Your Retirement Income
3 Top Dividend Stocks to Maximize Your Retirement Income
About this update from Coca-cola Femsa Sab De Cv Units Cons Of 5 Shs -l- + 3 Shs Series -b-
Strange but true: seniors fear death less than running out of money in retirement.And unfortunately, even retirees who have built a nest egg have good reason to be concerned - with the traditional approaches to retirement planning, income may no longer cover expenses. That means retirees are dipping into principal to make ends meet, setting up a race against time between dwindling investment balances and longer lifespans.Your parents' retirement investing plan won't cut it today.For many years, bonds or other fixed-income assets could produce the yield needed to provide solid income for retirement needs. However, these yields have dwindled over time: 10-year Treasury bond rates in the late 1990s were around 6.50%, but today, that rate is a thing of the past, with a slim likelihood of rates making a comeback in the foreseeable future.The impact of this rate decline is sizable: over 20 years, the difference in yield for a $1 million investment in 10-year Treasuries is more than $1 million.Today's retirees are getting hit hard by reduced bond yields - and the Social Security picture isn't too rosy either. Right now and for the near future, Social Security benefits are still being paid, but it has been estimated that the Social Security funds will be depleted as soon as 2035.So what can retirees do? You could dramatically reduce your expenses, and go out on a limb hoping your Social Security benefits don't diminish. On the other hand, you could opt for an alternative investment that gives a steady, higher-rate income stream to supplant lessening bond yields.Invest in Dividend StocksWe feel that these dividend-paying equities - as long as they are from high-quality, low-risk issuers - can give retirement investors a smart option to replace low-yielding Treasury bonds (or other bonds).Look for stocks that have paid steady, increasing dividends for years (or decades), and have not cut their dividends even during recessions.One way to identify suitable candidates is to look for stocks with an average dividend yield of 3%, and positive average annual dividend growth. Many stocks increase dividends over time, helping to offset the effects of inflation.Here are three dividend-paying stocks retirees should consider for their nest egg portfolio.Coca-Cola FEMSA (KOF) is currently shelling out a dividend of $0.81 per share, with a dividend yield of 3.18%. This compares ...