Stocks, Inflation, and Dividend Stocks

Mike at The Dividend Guy Blog wrote a phenomenal article that I can't recommend highly enough. In it, he discusses the invaluable role that dividends play in fighting inflation and riding out market slumps. He does a fantastic job of pointing out the fact that gold itself does not throw off income--it's only worth what someone is willing to pay for it. Dividend paying stocks, meanwhile, earn income and throw off dividends even in recessionary times (hopefully!) and can allow you to buy extra shares when the prices are low. This is truly the secret to steadily building long-term wealth. Especially if a company regularly raises its dividend, you will watch the money get regularly deposited into your accounts while you do nothing and watch the money grow. Not a bad deal--however, it does take a significant amount of money invested for the dividends to substantially change your lifestyle. It takes tens of thousands of dollars invested to regularly throw off hundreds of dollars in come each quarter. While it is a difficult journey, once you reach the point where you are generating income, you will be in much healthier financial shape. If you want to read a great article on the subject, check out Mike's article at The Dividend Guy Blog here: http://www.thedividendguyblog.com/investing-myths-debunked-regarding-inflation/ .