47 Million Reasons to Buy Dividend Stocks

There are two important things to recognize about dividend stocks right off the bat. First, it's been well documented by academics and investors that dividend stocks have outperformed their non-paying brethren over the long run. This means capital appreciation -- in other words, Mom's portfolio is going to rise, not fall, over time. Second, dividend stocks actually produce income, so if and when you need extra money to help support you in retirement, you can use the cash from the dividends to do so.

Are you 65 or older? If so, you're likely one of the 47.5 million people who currently depend on Medicare for either all or a portion of their medical expenses. Unfortunately, the trustees of the Medicare trust fund just released some information that could rearrange the way you think about your finances. When we hear news about companies ridding themselves of pensions, health-care costs increasing, and entitlement plans in near danger, it's easy to throw up your hands and pretend financial freedom is out of your control. That would be the easy way out, however. What you've got to do is take part of your nest egg, invest in the market, specifically in dividend stocks, and take one step at a time.

Source: Motley Fool

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