Observations on life

Collect those dividends

I am a great believer in arranging ones retirement income as much as possible with a steady stream of money that does not deplete accumulated assets.

There are several ways to do that. πŸ€‘ buy a life annuity with just a portion of your savings. πŸ€‘ invest in a bond mutual fund making regular interest payments πŸ€‘ buy stocks that have a good record of dividend payments.

Here is a list of companies from Kiplinger that have paid a dividend ever year for over 100 years. I can add another company that has paid a dividend every year since 1907, Public Service Enterprise Group (PEG) where I worked for forty-eight years.

I suggest start making these purchases (outside any retirement plan) when you are young; have all dividends and interest reinvested until you actually need the money in retirement and then convert to cash payments. This income plus Social Security will give you a cushion of steady income that may help minimize use of retirement funds or smooth out your income during bear markets.

Something to think about anyway.

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2 replies »

  1. My parents have used dividends for over 35 years as their retirement income, that also includes their SSA. it has been fine as he has the dividends setup so every month, they have money deposited.

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