Maximize Your Income: A Complete Guide to Investing in Dividend Growth

This tutorial groups together and orders the "pillar" texts of this blog. By reading these articles, you will quickly learn more about the growing dividends and their risks.

We do not come to be interested in this particular approach by chance.The combination of poor stock market performance and insignificant bond yields explain the Current renewed interest in dividends among investors. A few basic rules apply to achieve good results, such as avoiding excessively high returns and diversifying the sectors in your portfolio.

Once again, the United States is ahead of us in this area. On the Old Continent, many still limit themselves to seeking the highest yields. Many Americans, on the other hand, prefer progressive dividends.

Growing dividends

The principle is simple: we are looking for average, solid and growing dividends. Nothing too complicated, yet these dividends include a lot of assets : not only are they magical but moreover they beat the market.

Some of them are part of what is considered the high society dividends: dividend aristocrats, which have increased their distributions for at least 25 consecutive years.

Growing dividends protect against inflation and allow to preparing the ground for future rentiers. As we play on time, we must detach ourselves from the market sirens and play on the underlying trends in our society.

Indicators

The key numbers to follow when investing in growing dividends are: performance, THE annual growth rate, THE number of consecutive years of increase and the distribution ratio. Growth, allied to time, transforms discrete returns into real ones income boosters.

The distribution ratio is too often underestimated. However, it is essential when adopting an investment method based on dividends. It brings an informed look at performance and the price/earnings ratio.

Risks

Anyone who invests in the stock market takes risks a priori, but on closer inspection these are not higher than let your money sit in a savings account. Investing in dividends also has its risks and despite a long-term investment horizon, Sometimes it is necessary to sell some titles. It is also appropriate to define what will be done with the dividends received.

Since the best growing dividends are on the other side of the Atlantic, we are also exposed to currency risk. It is necessary to take a number of measures to protect against it.

Although investors are usually quite aware of the risks inherent in the investments they make, they very often neglect a very common risk, however, which is linked to feelings of fear and greedTo remedy this, it will have to adapt the volatility of its investments with his risk propensity.

The last point to consider refers to the market, which is also a risk in itself. A majority of dividend-growing stocks are relatively uncorrelated to the latter. However, it is difficult not to take it into account.

To enjoy it, you need to enter when the stock price is likely to provide decent long-term profitability. It is also necessary playing in a different league than the big players in the market.

Conclusion

In a nutshell, this tutorial shows you that the increasing dividend method is based on some simple principles to follow, which stand out from many stock market approaches, and which allow you to obtain solid and progressive income, with a view to why not become a rentier.