Income Investing With Low Payout Ratios
Dividends are the bread and butter of investing. If you don’t have dividend stocks in your portfolio, you’re holding yourself back. According to credit rating agency Standard and Poor’s, over the last 80 years dividends have been responsible for 44% of S&P 500 returns. Between 1929 and 2012, 2012, an investment in the S&P 500 would have returned 5.2% per annum excluding income but 9.4% including dividend distributions. When you compound the additional 4.2% of extra returns over the long term,…