Should You Sell Stock To Avoid The 'Cliff'

The "fiscal cliff" is to personal finance what Kryptonite is to Superman. Indeed, in today's post-election world, if your stock portfolio has one weakness, one vulnerability, one negative financial field force that is sapping it of its normal strength, it is the long list of dangers related to the nation's well-publicized fiscal woes. They carry the threat of recession and the potential for higher tax rates on stock profits and dividends. And that is putting investors' finances in a weakened state -- just as Kryptonite does to Superman.

Think twice before dumping dividend-paying stocks. That math sure sounds like a prescription for disaster for one of Wall Street's most successful investment plays in recent years: buying stocks that pay dividends to generate income in a low-yield world. But while a tripling of taxes on so-called dividend-payers on the surface screams "Sell," a closer analysis says not so fast, according to a research report by Strategas Research Partners titled, "Dividend Stocks: Now Is Not The Time To Sell."

Source: USA Today

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