Why You Should Invest in Dividend Stocks

Plus, what to look for when you do.

In good times and bad, and especially in uncertain times, a wise investor looks past the hustle and hype and goes for consistency. A thoughtful long-term dividend strategy can provide that for your portfolio—and it's a particularly appealing approach in today's low-interest-rate environment.

The benefits of dividends are well-documented. Past performance doesn't indicate future results, but since 1960, 29% of Standard & Poor's 500-stock index's returns have come from dividends. They're known to provide a cushion against the scary ups and downs of the market, with lower volatility and a higher Sharpe ratio (risk versus return). And dividend payers tend to outperform non-dividend payers over the long run.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

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Kurt Fillmore, Investment Adviser
Founder and President, Wealth Trac Financial

Kurt Fillmore is founder and president of Wealth Trac Financial, an independent financial services firm based in Bingham Farms, Michigan, specializing in customized wealth management and retirement planning. He is an Investment Adviser Representative and licensed insurance professional.