I have an IRA that focuses heavily on high-dividend companies. According to The Motley Fool, stocks that pay dividends increase in value at a rate of 2.5x that of non-dividend companies.
I have shares in the following companies:
- AGNC - a REIT stock...Insane dividends. They've been paying out 20% interest per year for over 2 years now. They buy up mortgages and undervalued houses, fix them up, and sell/rent them. Fantastic company.
- BJBHX - a high-growth mutual fund with a 7% yearly dividend. Its been the most solid investment I've made. Its gone up about 5% since I bought in March or April, but its dividends have been great.
- CEL - The leading Israeli telecommunications company (think Verizon of Israel). Way undervalued earlier this year, because there were fears that the Israeli government would block/ban some internet access...Dropped like 30%. I bought it at $26 a share. Its $32.50 now, and returns 7-10% in dividends per year.
Overall, my portfolio has gained a little since last year...I did make a bad investment on a trust that dropped 30% in a day, and I lost a bit of money on that. However, most other stocks I have been in have done well. Very happy with the three I've listed.
I'd suggest mutual funds and/or high-dividend stocks that are secure. There are a lot out there that are major companies that offer between 5-7% returns per year...Thats way better than CDs or America's wonderful Social Security system.
Back from the dead, I'm afraid.
