Step 6. Dividends have their place
Stock dividends play an important role in supplementing income for retirees. Thornburg discusses the benefits of a dividend income stream during retirement, using it as a potential alternative to a total return or a high-income approach.
Advisers should be open-minded when performing their research: Finding the right companies with high and growing dividends will require a global search, rather than one that’s just limited to domestic companies.
Thornburg also notes that using this global approach allows advisers to boost diversification according to industry: For instance, in the U.S., real estate and utilities often boast the most attractive dividends. Meanwhile, Nordic countries boast attractive dividends in telecom, and Australia fares well in financials.