A Publication of WTVP

Are you interested in investing for income over the long term rather than in participating in the daily ups and downs of the stock market, and want to know what would be a good investment strategy?

One choice for income seekers may be quality, long-term dividend-paying stocks. Many "name brand" companies haven’t only paid dividends consistently since the early 1990s; in some cases, they have also steadily raised their dividends by an average of 10 percent or more per year.

What makes these stocks attractive to long-term investors? Consistent dividend growth stocks may be attractive for long-term investors who can hold the stocks as dividend payments rise. Although the stocks’ current yields may not seem competitive at first, growth in dividend payments can significantly increase the yield on an original investment.

Why is dividend growth so important? An investor seeking income could purchase conservative fixed-income investments, such as Treasury bonds.

In fact, every well-balanced portfolio should contain such investments. However, without the power of dividend growth, inflation will take its bite, and these investors may end up losing ground to inflation over time.

What should you look for in a quality stock? Consider three factors that can limit your risk and keep your income growing when you’re looking for income among stocks:

However you choose your income stocks, the key is holding them for the long term, which means daily and monthly price swings may not be as important.

Remember, the time in the market—not timing the market—is most important to investment success. IBI