Part 4/10:

Investors focusing on dividends prioritize companies with a history of consistent payouts and, ideally, increasing dividends over time. This focus on stability over high growth means that dividend investing typically involves stable, slow-growing companies rather than high-tech innovators.

Benefits of Dividend Investing

A key advantage of dividend investing is the potential for passive income that can grow over time through reinvestment. If you start with a modest investment—say, $100 with a 6% dividend yield—your investment could grow to approximately $180 after ten years, assuming dividends are reinvested and yields stay constant. This illustrates the power of compounding returns.