web analytics
July 22, 2014 / 24 Tammuz, 5774
Israel at War: Operation Protective Edge
 
 
At a Glance
Blogs
Sponsored Post
IDC Advocacy Room IDC Fights War on Another Front

Student Union opens ‘hasbara’ room in effort to fill public diplomacy vacuum.



Three Reasons To Buy Dividend-Paying Stocks

Doug Goldstein

Have you thought about investing in dividend-paying stocks? As the name suggests, these are stocks that pay out a certain percentage of the company’s earnings as a dividend periodically (usually quarterly) to the investor. Recently, dividend-paying stocks have received a good press in publications such as The Wall Street Journal. Have you considered why dividend-paying stocks might be good for you?

Here are three possible reasons for thinking about dividend paying stocks:

1. You can reinvest the dividend payments in the same stock. Chances are you originally bought the stock because you believed in the fundamental strength and stability of the company. As long as you continue to believe in the strength of the particular firm, if you reinvest your dividend income in the company and continue to buy more shares of the same stock, you will increase your position in a company that you believe is strong. If you choose carefully, your investments might turn out like those of Grace Groner, a secretary at Abbott Labs. Her $180 investment in 1935 eventually grew to $7 million (which eventually went to fund a foundation to benefit students of Lake Forest College.)

2. Dividend-paying stocks have the potential to maintain a certain amount of stability when the market gets rough. Stocks that pay dividends are generally considered safer in a down market because they still keep a certain level of value and generate income in the form of a regularly paying dividend. Even if the stock value drops, unless the board of directors vote to eliminate the dividend, you can still anticipate receiving a periodic check.

3. The need to pay out dividends to shareholders can keep a company’s management in check. If the board of directors knows shareholders expect a dividend on a regular basis, they may be more likely to avoid embarking on risky projects that could end up fundamentally destabilizing the company. Since stockholders will only continue holding onto their shares if they believe in the fundamental stability of the company, both the board of directors and shareholders have a common interest in furthering the company’s profits.

If reading the above has convinced you that to buy dividend-paying stocks for your portfolio, wait a minute before you call me (or your broker). First, read my next post, to learn about potential problems with dividend-paying stocks. As always, don’t invest in anything until you get proper advice from a licensed financial advisor.

About the Author: Douglas Goldstein, CFP®, is the director of Profile Investment Services, Ltd, a financial planning firm located in Jerusalem. He specializes in working with clients in New York, Florida, and Israel and is a licensed financial professional both in the U.S. and Israel. Securities are offered through Portfolio Resources Group, Inc., Member FINRA, SIPC, MSRB, SIFMA. Accounts held at Pershing LLC., Member NYSE/SIPC, a subsidiary of The Bank of New York Mellon Corporation. Neither Profile nor PRG gives tax or legal advice. Before immigrating to Israel, it is advisable to consult with a tax attorney who is knowledgeable about Israeli law. Doug’s newest book The Expatriates’ Guide to Handling Money and Taxes is available at www.expatguidetomoney.com. He hosts a weekly finance show, Goldstein on Gelt, on internet radio. Listen live or download podcasts. Toll-free from U.S. 1-888-327-6179, Jerusalem: (02) 624-2788. Follow on Twitter: @DougGoldstein or contact at doug@profile-financial.com.


If you don't see your comment after publishing it, refresh the page.

Our comments section is intended for meaningful responses and debates in a civilized manner. We ask that you respect the fact that we are a religious Jewish website and avoid inappropriate language at all cost.

If you promote any foreign religions, gods or messiahs, lies about Israel, anti-Semitism, or advocate violence (except against terrorists), your permission to comment may be revoked.

No Responses to “Three Reasons To Buy Dividend-Paying Stocks”

Comments are closed.

SocialTwist Tell-a-Friend

Douglas Goldstein
Current Top Story
Military funeral in Israel
IDF Names Missing Soldier As Sgt. Oron Shaul
Latest Blogs Stories
Socks

If you are lloking to buy socks, this store is NOT where to go! B”H

Jewish Mother (ca. 1906), carved ivory by Boris Schatz.
Courtesy Kestenbaum & Company.

Ruthie Blum reveals just how hard it is for a Jewish mother to be a patriot at the time of war. Maternal cognitive dissonance On Thursday night, after 10 days of aerial warfare between Hamas terrorists and Israel, Prime Minister Benjamin Netanyahu approved a ground incursion into Gaza. It was a move that much of […]

IDF Chief of Staff, Benny Gantz talking to the media.

JoeSettler takes on the IDF Spokesperson’s tweets that he believes are morally wrong and negatively affect the war we are fighting…

Goldstein

The 7 Decisions that changed author Andy Andrews’ life and how they can guide you towards success.

Not asking the world for the right to defend ourselves; such a right is obvious to anyone with a spine.

Where has all the billions of Euros and dollars that have been poured into Gaza over the years gone?

One wishes the PA would distance itself completely from Hamas now for the sake of peace and development in the region.

Israel will never be the underdog, so no defense will be legitimized.

In a war, people die; all Israelis should know that by now.

“We thought they wanted a state; it turns out that all they want is to destroy Israel”

It’s called Operation Protective Edge and is a double-edged sword.

The majority of the Israeli public is against a ceasefire with Hamas at this time.

Bibi knew back then what needed to be done. So why isn’t PM Netanyahu listening to his younger self?

If eligible, are their benefits to claiming Spanish citizenship?

Suggestion: Along with not eating and drinking let us “fast” today from other indulgences…

More Articles from Doug Goldstein, CFP®
Goldstein

The 7 Decisions that changed author Andy Andrews’ life and how they can guide you towards success.

If eligible, are their benefits to claiming Spanish citizenship?

The importance and function of having a dream in building your own success.

An expert discusses the mistakes gamblers make and how to play safely at casinos.

Former hedge fund manager now makes new foods from castoff vegetables, explains how to win war on waste.

Listen to the author of a book about surviving – and even thriving – on a low-income salary.

Is e-commerce the wave of the future?

Doug Goldstein speaks with author Roberta Taylor about how couples need to plan for their retirement.

    Latest Poll

    Israel's Iron Dome Anti-Missile System:





    View Results

    Loading ... Loading ...

Printed from: http://www.jewishpress.com/blogs/goldstein-on-gelt/three-reasons-to-buy-dividend-paying-stocks/2012/07/18/

Scan this QR code to visit this page online: