You’ve likely heard the phrase, “cash is king.” To be sure cash is important, not only to companies but also to individuals. Without it we’re bankrupt and in a world of hurt.
The dividend investor takes the phrase “cash is king” very literally. They invest a good majority of their portfolio in anything that pays them dividends, or cold hard cash. This could be a stable stock with a good dividend yield, a mutual fund such as the T. Rowe Price Dividend Growth fund or even, gasp, bonds.
In difficult times such as these it can be comforting to know that even if your investment loses value, you’re still earning a dividend just for owning it. Stocks such as GE, JNJ, MSFT and even T are good examples of stocks that have a good dividend yield and (as far as I know) good long-term stability.
Are you a dividend investor? Do you choose investments based on if they offer a dividend payout or a similar cash payment? I personally don’t have much invested in divided stocks, but I’m always looking to expand my portfolio. I’d love to hear your thoughts on dividend investing!