Investors typically have different needs and tolerances for risk depending on their stage of life. During the accumulation years, youre likely more comfortable with risk in order to pursue aggressive growth. As you approach distribution age, your appetite for risk often diminishes in favor of more conservative sources of income.

A rising dividend strategy could meet the needs of both risk tolerances as it can provide the potential for higher total returns to achieve growth while supplying steady income if the investor elects not to reinvest them.

For example, a growth-oriented young investor who used the Diversified Stock Income Plan with a starting portfolio value of $500,000 could generate $12,000 annually toward retirement income by reinvesting dividends. An older, conservative investor whose portfolio is in distribution might opt not to reinvest the dividends in an uncertain future feeling that a bird in the hand is worth two in the bush.

Every individual must assess their comfort level with investment strategies and use a cost-benefit analysis to determine the approach thats right for them. Explore your options from mutual funds and ETFs to rising dividend portfolios, separately managed accounts and more but then commit to a well-thought-out, long-term plan. When it comes to investing, discipline pays dividends.

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Potential Rising Income Streams and Equity Retirement Solutions - Dividend.com