Dividends Matter If They Matter To You

There has been a spate of recent articles debating the relevance of dividends. Dale Roberts got things started with "Actually It Is All About Total Return Totally!" He followed that up with "Dividends Don't Matter in Retirement Either," and then with "How Dividends Don't Matter in Retirement A Few Examples." The author's point in all of the articles was essentially that since dividends do not drive earning power, they are immaterial. He stated that "all that matters is total return," and "whoever has the most money wins."

The fact is that investors have all sorts of different goals, and they cannot be fenced into one single category. Investing for income, and/or income growth, at any stage of one's life may not only be a sensible goal, it may be the single best goal for certain individuals. As self-directed investors, we have a cornucopia of choices as to how to invest. We take what business models and investment products we find and decide which ones best suit our needs. Our needs are defined by ourselves, and they are called our goals. Dividends matter if they matter to you.

Source: Seeking Alpha

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