Solid Investments for Retirement

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Investments for Income in Retirement

A substantial part of any investment portfolio in retirement is typically in dividend stocks. While a person may have reinvested dividends over the years, they will typically take the dividends during retirement. Well-chosen companies with dividend stocks have been paying dividends for decades and steadily increasing the dividends as well. The ability to keep doing this is a measure of the financial health of such an investment.

Solid Investments for Retirement

Although dividend stocks are a mainstay of a retirement portfolio, they are not the only stocks you should have. The Motley Fool suggests buying these 3 stocks if you are retired.

Alphabet (Google) Logo
Alphabet (Google) Logo
  • Invest at least 75% of its total assets in real estate, cash or U.S. Treasuries
  • Receive at least 75% of its gross income from rents from real property, interest on mortgages financing real property or from sales of real estate
  • Pay a minimum of 90% percent of its taxable income in the form of shareholder dividends each year
  • Be an entity that is taxable as a corporation
  • Be managed by a board of directors or trustees
  • Have a minimum of 100 shareholders after its first year of existence
  • Have no more than 50% of its shares held by five or fewer individuals during the last half of the taxable year

Diversification is Wise

As much as you may be impressed by Alphabet, Coca Cola, Procter & Gamble, or any other investment for retirement, it is not wise to limit your retirement portfolio to one stock. On the other hand, it is also not wise to have a hundred stocks in your portfolio. Smart investors go into retirement with enough stocks to be diversified and a small enough number that they can easily carry out periodic fundamental analysis. You may not change anything in your investment portfolio for years and years but it is wise to make sure that your portfolio does not contain a General Electric which everyone loves but does not grow, or an Eastman Kodak whose business model has become extinct!

AAA Bond Rating
AAA Bond Rating

Is any Risk Allowed in a Well-Designed Retirement Portfolio?

Pure speculation with your retirement savings is frankly dumb! But, if you have expertise in a given area and can spot investments with a strong potential, it would be a waste talent not to put a small percentage of your retirement portfolio to work on the potential for dramatic growth. In the end, solid investments for retirement are those with a good business plan and strong intrinsic value. If you can spot that in a small startup, it probably belongs in your portfolio.

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