Dividend growth is the key to retirement because it fends off the effects of inflation. Even amid low inflation of 2% to 3% a year, a stagnant dividend will actually lose 2% to 3% of purchasing power a year. The only way to actually grow your income over time, then, is to invest in companies whose management makes rising dividends a priority.
That’s one reason you should buy stocks before their dividend increases. And we’ll review nine upcoming payout raises in a moment.
But there’s a second reason that’s coming to the fore of late: interest rates.
While the Federal Reserve has tried to put the spurs to interest rates with five bumps to the Fed funds rate since December 2015, bond yields haven’t cooperated much.…
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