News & Trending Investing News

10 Stocks Retirees Love Because They Have a History of Paying Dividends

The right dividend stock picks can supplement your income in retirement.

By Sarah Sharkey

Edited by Chris Kissell

Updated Dec. 17, 2024

Dividend stocks can offer a steady stream of income to long-term investors, who get to share in the fruits of a company’s labor in the form of a dividend payment.

Depending on your situation and the companies you choose, adding dividend stocks to your portfolio can maximize your retirement savings over time.

As with all stock picks, past performance isn’t a guarantee of future success. Buying stocks always includes an element of risk. For that reason, you might want to talk with a financial adviser before purchasing dividend stocks.

Steal this billionaire wealth-building technique

The ultra-rich have also been investing in art from big names like Picasso and Bansky for centuries. And it's for a good reason: Contemporary art prices have outpaced the S&P 500 by 136% over the last 27 years.

A new company called Masterworks is now allowing everyday investors to get in on this type of previously-exclusive investment. You can buy a small slice of $1-$30 million paintings from iconic artists, all without needing any art expertise.

If you have at least $10k to invest and are ready to explore diversifying beyond stocks and bonds,see what Masterworks has on offer. (Hurry, they often sell out!)

What are dividend stocks?

A dividend stock offers you a slice of a publicly traded company that has a history of regularly sharing profits with shareholders in the form of dividends.

As the investor, you purchase a stock. From there, you wait for the company to send out dividend payments. Although dividends are often paid quarterly, some companies choose other dividend schedules.

It’s worth noting that a company isn’t necessarily required to pay out dividends. If a company has a bad year or changes its policy, you could see dividends from that particular stock dry up.

Below is a look at some stocks of companies known for paying out dividends.

Want to learn how to build wealth like the 1%? Sign up for Worthy to get ideas and advice delivered to your inbox.

JPMorgan Chase & Co. (JPM)

JPMorgan Chase is one of the largest banks in the world and boasts around $3.8 trillion in assets. The company has been in business for more than two centuries and is known for providing services related to investment banking and commercial banking.

The bank currently offers a dividend yield of 2.01%.

Home Depot Inc. (HD)

Recognizable as the largest home improvement retailer in the U.S., Home Depot has become a success story thanks to the millions of Americans who regularly buy and update homes. The company has more than 2,300 stores from coast to coast.

Home Depot currently offers a dividend yield of 2.14%.

Get a free stock valued between $5 to $200

Secret: You don't need thousands of dollars to buy thousand-dollar stocks or create a diverse portfolio.

Robinhood offers a method of investing called “fractional shares.” On its own, one share of a single stock could cost a lot of money, making it difficult to diversify. Robinhood allows you to buy pieces of stock instead, so you have the option to build a diverse portfolio quickly.

Let’s say you want to invest $250, as an example.

With that amount, you could build a relatively diverse portfolio with an investment of $50 in a big tech stock, $50 in a retail stock, $50 in an energy stock, $50 in a manufacturing stock, and $50 in a bank.¹ This content is for informational purposes only, you should not construe any such information as legal, tax, investment, financial, or other advice. To get stock reward, new customers need to sign up, get approved, and link their bank account. Stock rewards shares cannot be sold until 3 trading days after the reward is granted and the cash value of the stock rewards may not be withdrawn for 30 days after the reward is claimed. Stock rewards not claimed within 60 days may expire. See full terms and conditions at <a href="https://robinhood.com/us/en/support/articles/open-account-pick-your-stock/">rbnhd.co/freestock</a>. Fractional shares are illiquid outside of Robinhood and are not transferable. Not all securities available through Robinhood are eligible for fractional share orders. For a complete explanation of conditions, restrictions and limitations associated with fractional shares, see the Fractional Shares section of our Customer Agreement. Robinhood Gold is offered through Robinhood Financial LLC and is a membership offering premium services available for a fee.

Even better news? Add a Robinhood Gold membership, and you’ll get access to 4.25% (as of 11/15/24) APY² Annual Percentage Yield. Rate valid as of April 12, 2024. To earn interest, a cash balance is needed. If you have a margin balance, there is no cash balance to earn interest. Interest rates for cash sweep and margin investing can change at any time. Fees may reduce interest earnings. on your uninvested cash³ Interest is earned on uninvested cash swept from your brokerage account to partner banks. Partner banks pay interest on your swept cash, minus any fees paid to Robinhood. As of Nov 15, 2023, the Annual Percentage Yield (APY) that you will receive is 1.5%, or 5% for Gold customers. The APY might change at any time at the partner banks' or Robinhood's discretion. Additionally, any fees Robinhood receives may vary and are subject to change. Neither Robinhood Financial LLC nor any of its affiliates are banks. All investments involve risk and loss of principal is possible. Robinhood Financial LLC (member SIPC), is a registered broker dealer. and the ability to buy and sell stocks 24 hours a day, 5 days a week.

Open and fund a Robinhood account and earn up to $200 in stock

Coca-Cola Co. (KO)

Coca-Cola is one of the most iconic brands in the world. The maker of a beloved line of carbonated drinks has been a strong company for many years. In fact, Coke has sold its famous soda since 1892.

In recent years, the company has begun to diversify away from sugary drinks as people have become more health-conscious.

Coca-Cola currently has a dividend yield of 3.04%.

Merck & Co. Inc. (MRK)

Merck is a pharmaceutical company that has been around for more than 130 years. It researches new ways to treat or prevent disease in both people and animals. In 2023, Merck boasted a total revenue of $60.1 billion.

Merck currently offers a dividend yield of 3.11%.

Chevron Corp. (CVX)

Chevron is primarily known as an oil and gas company, but it also delivers lubricants such as motor oil, as well as petrochemicals and additives. The company is also in the process of trying to drive down its costs through improvements in technology.

Chevron currently has a dividend yield of 4.02%.

Grow Your $$: 11 brilliant ways to build wealth after 40

Procter & Gamble Co. (PG)

Even if you don’t know much about Procter & Gamble, it’s likely you have one of the company’s products in your house right now. P&G manufactures a slew of household goods, such as shampoos, laundry detergents, dish soap, and more.

Procter & Gamble currently offers a dividend yield of 2.28%.

Cisco Systems Inc. (CSCO)

In an increasingly digital world, the cybersecurity features offered by Cisco Systems are likely to be in high demand for many years. The company also offers technology focused on areas such as networking, collaboration, and cloud management.

Cisco currently offers a dividend yield of 2.72%.

AbbVie Inc. (ABBV)

AbbVie is a pharmaceutical company founded in 2013, when it was split from Abbott Laboratories. Like any company in its industry, AbbVie focuses on developing new treatments and therapies to keep chronic and deadly diseases at bay.

AbbVie currently has a dividend yield of 3.5%.

Earn up to a $300 bonus and grow your money with up to 4.00% APY

This powerful combination checking + savings account from SoFi® allows you to earn up to a $300 bonus with direct deposit and grow your money with up to 4.00% APY.⁴ New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at <a href="http://sofi.com/banking">sofi.com/banking</a>. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC. SoFi members with Direct Deposit can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Direct Deposit amount required to qualify for the 4.00% APY for savings (including Vaults). Members without Direct Deposit will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of Dec. 3, 2024. There is no minimum balance requirement. Additional information can be found at <a href="http://www.sofi.com/legal/banking-rate-sheet">http://www.sofi.com/legal/banking-rate-sheet</a>

This is one of the top accounts we’ve seen, and offers like this can be rare. You work hard, and now it’s time to make your money work for you — with SoFi, you can grow your money with hardly any effort!

SoFi has no account or overdraft fees⁵ Overdraft Coverage is limited to $50 on debit card purchases only and is an account benefit available to customers with direct deposits of $1,000 or more during the current 30-day Evaluation Period as determined by SoFi Bank, N.A. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Members with a prior history of non-repayment of negative balances are ineligible for Overdraft Coverage. and additional FDIC insurance up to $2 million on deposits is available through a seamless network of participating banks.⁶ We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a> ⁷ SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/terms">SoFi.com/banking/fdic/terms</a> See list of participating banks at <a href="http://sofi.com/banking/fdic/receivingbanks">SoFi.com/banking/fdic/receivingbanks</a> Plus, you can receive your paycheck up to 2 days early.⁸ Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.

How to earn up to $300: Sign up and make a direct deposit within the first 25 calendar days of the promotional period, then collect a $300 cash bonus with a direct deposit of $5,000 or more.

SoFi is a Member, FDIC. ⁷ SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/terms">SoFi.com/banking/fdic/terms</a> See list of participating banks at <a href="http://sofi.com/banking/fdic/receivingbanks">SoFi.com/banking/fdic/receivingbanks</a>

Open your SoFi account and set up direct deposit

Southern Co. (SO)

Southern Co. is a gas and utility holding firm based in Atlanta. It provides service for 9 million customers, making it one of the biggest utility companies in the U.S. Southern’s focus on renewable energy makes it attractive to many investors.

Southern currently has a dividend yield of 3.29%.

Amgen (AMGN)

Amgen is one of the largest biopharmaceutical companies in the world. It has a presence in about 100 countries across the world and focuses on therapies in areas such as inflammation, oncology, and rare diseases.

It currently has a dividend yield of 3.06%.

Bottom line

Dividend stocks can provide a nice way to build an income stream in retirement. But as with any stock, there is plenty of risk involved.

As you start investing, weigh all of your options before committing a significant portion of your portfolio to any particular type of asset. Sitting down and discussing your goals and options with a financial advisor can be a good option for many investors.

More from FinanceBuzz:

Invest in Paintings by Basquiat, Picasso, Banksy

Masterworks Benefits

Invest in art like a millionaire for a relatively low cost
Art investments have outperformed the S&P 500 by over 131% for 26 years
Purchase shares of artwork by top artists
Hedge against inflation and diversify your portfolio

Visit Masterworks