The following quote on Chevron Group (NYSE:CVX) that I read tonight really confirmed what I have been thinking for some time and wanting to convey to younger investors:
"I could not more highly recommend (CVX) as a long-term, core holding. I have owned the stock since March 1970 when I purchased 100 shares of Std. Oil of California for $4,400. After four 2 for one splits, we own 1600 shares valued at about $174,000. In the intervening 42 years, we have received roughly $100,000 in sweet cash dividends. Now 85 years old, the annual dividend helps us live a stressless and secure retirement."
(Tortoise #1 - March 7, 2012)
The value of investing in good dividend paying stocks, which demonstrate long term potential for capital growth, supported by a dividend reinvestment plan and regular contributions, should be a core strategy for all young investors in terms of their retirement planning. By retirement planning for young investors, I mean implementing a strategy as soon as you start earning your first regular pay check - whether that be at age 14, age 18 or age 21.
I believe that the changing environment of investing for retirement, and government's (globally) unwillingness to fund retirement pensions, will firmly place the onus on supporting oneself in retirement (as it should be). I believe that Generation X and Generation Y have the potential to posture themselves for retirement far better than the Baby Boomers have been able to. I propose that that all young investors portfolios should include a core weighting of consistent yielding dividend stocks, and that if we look at history's example, there are plenty of tricks 'old dogs' can teach the 'young dogs'....
To read the article in full go to Seeking Alpha