6 Safe Dividend-Paying Stocks for Retirees to Consider
As people approach retirement, one of the most important concerns they have is how to generate income that can sustain their lifestyle. Investing in stocks that offer dividends is a popular way for retirees to supplement their retirement income while also preserving capital.
However, not all dividend-paying stocks are created equal. Retirees must be careful when selecting these stocks as they need to ensure that the company has a solid financial standing and the dividend payments will continue even during market volatility.
Here are some safe dividend-paying stocks that retirees may want to consider:
1. Johnson & Johnson (JNJ)
Johnson & Johnson is a diversified healthcare conglomerate with a long history of stable earnings and consistent dividends. The company’s products range from pharmaceuticals and medical devices to consumer health products like Band-Aids and Tylenol.
The stock currently yields around 2.6%, which may not seem high compared to other companies on this list but JNJ’s track record makes it an attractive choice for risk-averse investors looking for steady returns. The company has increased its dividend payout every year since 1963, making it one of only two U.S.-listed companies with such an impressive feat.
2. Procter & Gamble Co (PG)
Procter & Gamble Co is another blue-chip stock with an excellent track record of stable earnings growth and consistent dividends payouts over time. P&G offers personal care brands like Crest toothpaste, Tide laundry detergent, Gillette razors, among others.
Currently yielding around 2.5%, P&G’s strong cash flow allows them to continue paying out consistent dividends despite economic uncertainty or market volatility.
3. Coca-Cola Co (KO)
Coca-Cola Co needs no introduction as it’s known worldwide for its iconic brand name and flavored beverages including Coke Classic, Sprite, Fanta Orange just to mention a few.
With more than 50 years of uninterrupted dividend increases under its belt – KO currently yields around 3% and has solid financials that can support its dividend payouts.
4. Verizon Communications Inc (VZ)
Verizon is a telecommunications company that, in addition to providing phone and internet services, also provides digital video and advertising services. The company currently yields over 4%, which is higher than most of the other companies on this list.
In addition to its high yield, VZ’s strong cash flow position allows it to cover its dividend payments even during times of economic uncertainty or market volatility.
5. Apple Inc (AAPL)
Apple is not typically thought of as a dividend stock but with a current yield of around 1%, it’s worth considering for retirees who are looking for technology exposure in their portfolio while still earning income from dividends.
With over $200 billion in cash reserves, AAPL has more than enough resources to continue paying out consistent dividends even if the tech sector experiences fluctuations in earnings growth or market volatility.
6. AT&T Inc (T)
AT&T is a telecommunications giant that offers wireless and wireline telephone services alongside satellite television services through DirecTV. Currently yielding almost 7%, T’s strong free cash flow generation allows them to continue paying out dividends despite fierce competition among telecommunication providers.
However, retirees must note that given the high payout ratio (dividend per share divided by earnings per share), T may be exposed to greater risks compared to other companies on this list.
Conclusion
Retirees seeking steady income streams should consider investing in safe dividend-paying stocks like Johnson & Johnson, Procter & Gamble Co., Coca-Cola Co., Verizon Communications Inc., Apple Inc., and AT&T Inc.. These blue-chip stocks have proven track records of stable earnings growth and consistent dividends payouts over time – making them great investment options for risk-averse investors looking for reliable returns on their investments.