It’s never too early in the year to start planning around a critical year-end retirement issue: Required Minimum Distributions. If you’re of a certain age, the RMD is a feature built into retirement plans like an IRA to force you to take some of your money out rather than keep it sheltered from taxes and growing indefinitely. You must take the money out by the end of the calendar year (12/31) or risk a penalty of 50% of the amount of the RMD. With such a punitive event out on the horizon, actively planning is critical — both in regards to how much you’re taking out and what you’ll do with it.
While you can take the money and simply head off to that golf course you always wanted to play or simply sock it away for a rainy day, a better idea is to invest your RMD money in dividend paying stocks. This way you’ll see quarterly (or monthly) income coming back to you from that extra money. Here are some ideas, with stocks with trailing price-to-earnings ratios under 20, implying a fair valuation, along with decent dividends that are over 3% and have a payout ratio of less than 60% of total earnings to show they are sustainable over the long term: McDonald’s (MCD), Intel (INTC), Clorox (CLX), Kraft Foods (KRFT) and General Mills (GIS).
Source: InvestorPlace
Related Articles:
- 9 High-Yielding Mega-Cap Stocks
- Best Stocks for 2013
- Dividend Investors Should Focus On Stocks, Not The Market
- The Secret Ingredient of Dividend Growth Stocks
- 9 High-Yield Stocks With A Low Price To Book
Dividend Stocks Perfect for New Money
Posted by D4L | Friday, October 04, 2013 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
Dividends and diversification -- those two things can help you achieve a comfortable retirement when combined with the income you will recei...
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
The best dividend stocks have one thing in common: resiliency. They can continue increasing their dividends even in the harshest economic en...
-
Investors wanting to enjoy steady and consistent income should consider dividend aristocrats. In fact, even in these chaotic times, dividend...
-
A good dividend stock has more than a high yield. Dividends need to be supported by cash flow, and cash flow depends on the long-term streng...
-
When looking for dividend stocks to invest in, it is advisable to choose companies that have strong dividend histories and stable balance sh...
-
Higher dividend yields often imply that the underlying company paying the dividend has a higher risk profile. However, that's not always...
-
It's hard to beat a sustainable, high-yield dividend paired with a beaten-down valuation. The best dividend stocks offer high yields and...
-
When hunting for discounted investments, one excellent starting point is to look for businesses with dividend yields trading above their fiv...
-
Strange but true: seniors fear death less than running out of money in retirement. And unfortunately, even retirees who have built a nest eg...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.