24 Oct Should I buy dividend stocks or something else?

Q. For most of my life, I’ve favored dividend stocks. I think I’ve done well over time. I’m getting closer to retirement. What’s the best way to analyze my investments now? I do reinvest the dividends.
— Investor

A. Stocks that pay a regular dividend have always been attractive to investors.

But we want to make sure you’re looking at the big picture when considering this.

Rather than focus on your specific holdings, you should look at your portfolio as it pertains to a retirement plan, said Bill Connington of Connington Wealth Management in Paramus.

“Whether you own bonds, CD’s, stocks and either take dividends as cash or reinvest, the best way to analyze your investments is: How are they going to be invested going forward to achieve the comfortable retirement that you are looking for?” he said.

The plan will give you a blueprint on how those assets will grow and how you can take the income that you will need to supplement your Social Security and/or pension, Connington said.

“Whether it is in dividend stocks or growth these investments must grow over time to continue to meet your needs and cover future health care costs,” he said. “By planning for retirement, it will help to analyze the investments you presently have and that will give you the knowledge to decide the best way for you to move forward.”

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This story was originally published on Oct. 24, 2023.

NJMoneyHelp.com presents certain general financial planning principles and advice, but should never be viewed as a substitute for obtaining advice from a personal professional advisor who understands your unique individual circumstances.