Advantages of Investing in Dividend Stocks for Retirement Planning
When planning for retirement, choosing a mix between stocks that offer growth and bonds that offer security is a very important choice. While stocks typically offer the opportunity to grow your wealth, they are also more susceptible to losses. On the flipside, bonds give you access to a fixed rate of return but typically have lower returns than stocks on average.
Despite the differences between the two there is a middle ground where you can also invest, stocks that offer a dividend. A dividend is when a company pays you for owning its stock as a reward for investors putting your money into their business.
Stocks with a dividend give people the opportunity to create a steady stream of income like a bond but also have the opportunity for growth of your nest egg. However, dividend stocks still have similar risk factors present in all stocks including potential for large losses so be sure to choose your strategy according to the amount of risk you are comfortable with.
While an investment in green company though buying their stock has a minimal impact when it comes to supporting the business, green investing is an area that has grown incredibly rapidly and is expected to in the future. This fact presents an interesting opportunity to grow your nest egg but also comes with more risk as the industry is fairly new.
While offering little support for the business, investing in companies who are green and care about ESG factors can actually be something that reduces the risk as it is now widely accepted that ESG risks present real and harmful risks to a business.
If you are looking for a green company with the opportunity for growth and that pays a dividend, look no further than RE Royalties.
For every share of RE Royalties stock that you own, the company will pay you $0.01 per quarter or a total of $0.04 per year per stock you own. For example, at the current price as of writing this article (of $1.36 CDN), that $0.04 per year translates to a dividend yield of around 3% which is the average dividend yield across the entire Canadian stock market.
Dividend stocks enable people to receive a fairly consistent cash payout with the potential for growth of your money. These special stocks are a suitable investment for those at all stages of retirement planning, whether you are just beginning to save, mid-way through your career or even if you are just about to retire, the ability to get a consistent payout is something that is invaluable.
Learn more about how to save for retirement while saving the planet here.