Looking for an easy way to boost your portfolio’s long-term returns? Here’s one: buy and hold top-quality dividend stocks—especially those that raise their payouts every single year.

Analysis from Ned Davis Research backs that up: from 1974 through 2014, non-dividend-payers eked out just a 2.6% average annual return. That’s barely enough to stay ahead of inflation!

Dividend-payers returned 7.7%, which isn’t bad—but why settle for that when you could’ve held stocks that regularly hike their payouts and pocketed a tidy 10.1% a year, on average?

5 Growing Payouts That Go Great Together

Here’s a five-stock portfolio packed with some of my favorite dividend growers now.… Read more

Investors, spooked by the massacre of 2008 and the market’s latest gyrations, are making the same mistake again. They’re running scared into so-called “safe” fixed-income investments like CDs and treasuries—and ignoring stocks altogether.

A recent survey by Franklin Templeton found that 37% of long-term investors thought they’d be just fine leaving stocks out of their retirement portfolios. For investors in their 20s and 30s, that number jumps to 56%.

That’s a big mistake—unless these folks are incredibly wealthy, they’re not going to be able to enjoy retirement in financial comfort. If your nest egg doesn’t have a big allocation to equities, read on and I’ll break down the best dividend stocks for you to consider today.… Read more

As we approach tax time, many investors open their brokerages statements for the first time in a year. Those that “outsourced” their investing decisions to fund managers are often disappointed. On the whole, these vehicles tend to underperform the broader market.

Of course there are exceptions. For example, the Vanguard High Dividend Yield ETF (VYM) has outperformed the S&P 500 over the past five years (83.4% cumulatively versus 81.6%). It pays a 3.4% yield today, which is certainly better than the S&P’s paltry 2.1% payout.

But VYM can leave you holding an unexpected tax bill this time of year. Even if you didn’t sell your shares of the fund in 2015, its realized gains can be passed onto you.… Read more

Vice pays if you’re an investor. You’ll earn higher yields and returns investing in booze, tobacco, firearms, and gambling than you will in feel-good stories like clean energy.

“First-level” investors tend to avoid these types of stocks. As a result, they’re often cheap.

For example, you may think smoking is a fading habit. But even today, one in six Americans still smoke. Despite the warning labels, the public campaigns, and a concerted effort to ban smoking in most public places, some folks still just want a cigarette.

And since smokers are going to keep smoking, we should consider the perennial dividend growers who profit from the sustainability of cigarettes.… Read more

Growth at a reasonable price, or GARP, is an investing strategy that blends value and growth investing. Instead of just buying a stock that’s cheap, or one that’s growing earnings fast, we look for stocks that appear decently priced with respect to year-over-year growth.

For example, a company growing 15% annually with a price-to-earnings (P/E) ratio of 15 or less would be considered cheap by GARP standards. Since the “E” is growing at 15% per year, the P/E next year will either decline towards 13, or the stock price will rise in tandem with earnings.

It sounds like a foolproof investing formula.… Read more