Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Let These Stocks Help You Retire Richer

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

With recent events ranging from a catastrophic earthquake in Japan and unrest in northern Africa and the Persian Gulf to sovereign debt fears in Europe and price worries in emerging markets around the world, striving for a safe, secure retirement for you and your family may seem more difficult than ever. But with the right portfolio of stocks, you can weather whatever storms come your way and put yourself in the best position to achieve financial security in your golden years.

After the stock market has enjoyed a big rally, it's always hard to figure out how best to invest. With many stocks on the expensive side, you never want to be the last one without a chair when the music stops and stocks finally start to correct after their huge gains. Yet as many investors have found over the past two years, getting left on the sidelines is far from comfortable during a bull market -- and it's impossible to tell how much longer stocks could continue to advance.

The (too) popular answer
The easiest thing to do when you're in doubt about where to invest your money is to follow the crowd into the most popular investments. Often, that leads ordinary investors into the stocks that have had the biggest gains recently. If you're trying to reduce your risk, piling into momentum stocks after they've already enjoyed their biggest gains can be a major mistake.

For retirement investors, though, perhaps the most popular trade has involved blue-chip dividend stocks. Plenty of the largest, best-known stocks in the market trade at reasonably low valuations and pay decent dividend yields. Johnson & Johnson (NYSE: JNJ  ) , Wal-Mart, and ConocoPhillips (NYSE: COP  ) are just one example of a diversified trio of industry leaders all of which trade at P/E multiples of 13 or less and pay dividends of 2.5% or more.

It's hard to argue against solid stocks at attractive valuations. But unless you already have all the money you'll ever need, you probably want to add some other stocks to your portfolio -- stocks that lean a bit further toward the growth side of the income/growth spectrum without giving up on stability or value entirely.

Spice it up
To add some diversification to a big-cap dividend portfolio, I went in search of small- and mid-cap stocks that combine reasonable earnings multiples, good dividend yields, and stable stock performance. Here are some of the best picks I came up with:


Market Cap

Dividend Yield

Current P/E

3-Year Beta

My Watchlist

Molson Coors (NYSE: TAP  ) $7.15 billion 2.5% 11.7 0.72 Add
Alliance Resource Partners (Nasdaq: ARLP  ) $2.7 billion 4.7% 11.0 0.81 Add
Harris (NYSE: HRS  ) $5.83 billion 2.2% 9.3 0.91 Add
Hillenbrand (NYSE: HI  ) $1.36 billion 3.5% 14.9 0.72 Add
Scana (NYSE: SCG  ) $5.12 billion 4.8% 13.4 0.58 Add

Source: Motley Fool CAPS. Data current as of March 14.

These stocks come from a variety of industries, from funeral services provider Hillenbrand to energy and utility plays like Scana and Alliance. Molson Coors has brewed up dividends going back decades, while communications equipment maker Harris boasts connections with government defense-related agencies around the world.

If you're trying to save for retirement, these stocks certainly aren't the only ones that could fit the bill. But what these stocks would accomplish is to go beyond the everyday blue chips that dominate so many investors' portfolios. Although those large-cap stocks have rightfully earned their reputations as secure places to invest, it's easy to fall into the trap of believing that they're the only stocks you need.

Keep working
In uncertain times, it's easy to think there's no point in striving so hard to reach financial independence. But don't let a harsh economic environment knock you off your stride. By staying open to stocks that aren't popular enough to make the front pages every day, you'll stand a better chance of helping your retirement portfolio grow big enough to meet all your retirement needs.

Get these stocks on your watchlist today by using our new tracking service, My Watchlist. You'll get the news you need on these stocks and more to be a smarter investor. Click here and get started today.

Johnson & Johnson, Molson Coors, and Wal-Mart are Motley Fool Inside Value recommendations. Wal-Mart is a Motley Fool Global Gains recommendation. Alliance Resource Partners, Hillenbrand, and Johnson & Johnson are Motley Fool Income Investor recommendations. Motley Fool Options has recommended a diagonal call positions on Johnson & Johnson and Wal-Mart. The Fool owns shares of Hillenbrand, Johnson & Johnson, Molson Coors, and Wal-Mart. Motley Fool Alpha owns shares of Johnson & Johnson.

Fool contributor Dan Caplinger isn't afraid to ask for help. He doesn't own shares of the companies mentioned in this article. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy helps you every day.

Read/Post Comments (0) | Recommend This Article (14)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1458588, ~/Articles/ArticleHandler.aspx, 10/24/2016 12:41:37 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,220.60 74.89 0.41%
S&P 500 2,148.71 7.55 0.35%
NASD 5,300.63 43.23 0.82%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/24/2016 12:21 PM
ARLP $23.55 Up +0.10 +0.43%
Alliance Resource… CAPS Rating: ***
HI $30.80 Up +0.22 +0.72%
Hillenbrand CAPS Rating: *****
HRS $91.32 Up +0.78 +0.86%
Harris CAPS Rating: ****
SCG $70.56 Up +0.15 +0.21%
SCANA CAPS Rating: *****
TAP $108.11 Down -0.52 -0.48%
Molson Coors Brewi… CAPS Rating: ***
COP $41.98 Up +0.44 +1.06%
ConocoPhillips CAPS Rating: ****
JNJ $113.85 Up +0.41 +0.36%
Johnson and Johnso… CAPS Rating: ****