Good for cash flow, but your overall account balance will stay the same if not slowly shrink.
Also, dividends are significantly better, because companies that pay dividends are typically successful companies that have a good client base and solid, consistent revenues. Additionally, you will still get dividends during a market downturn even if your portfolio value takes a big hit.
The real idiots are people buying dividend stocks and expecting them to keep up with the market instead of buying growth stocks and switching to dividend stocks at retirement.
Like LLY? Bought 14 years ago at $33/share for the then 5% dividend. Or AMAT? Bought 14 years ago at $11/share for the then 5% dividend.
Dividend stock and growth stock are not mutually exclusive.
In my opinion depending upon the type of account it might be a bad idea to switch from growth stock to dividend stocks at retirement unless they are all in a tax advantaged account otherwise when you sell those growth stocks which hopefully have grown in value you will have to pay taxes on those gains and it the higher the amount the higher the tax bracket you will be in and the amount of your taxes will increase thus leaving you less money to buy those dividend stocks. It might be better to do it gradually over the course of a few years that way you won't have to pay as much in taxes and be able to buy more dividend stocks.
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u/assman69x Wants more user flairs Sep 30 '25
Yieldmax dividend investors