Q: I'm 55 and just rolled an old 401(k) over into an IRA. What are some stock investments you would suggest for me?
As you get older, your investing priorities change. Instead of focusing on long-term growth, your aim should shift to preserving your nest egg and creating an income stream that can help cover your expenses during retirement. So, since you're in your 50s and a decade or so away from retiring, look for stocks that can help you do that.
A good place to start is with the Dividend Aristocrats, which are stocks that have increased their dividend annually for at least 25 consecutive years. A couple of my favorites are consumer goods specialist Procter & Gamble, which pays a 3% dividend yield and has increased its payout for 60 consecutive years; and ExxonMobil, an oil and gas titan with a 34-year streak of increases and an above-average 3.8% yield.
Of course, if you don't want to choose individual stocks, an ETF like the Vanguard High Dividend Yield ETF could be the best choice for you. This fund invests in over 400 stocks. Procter & Gamble and ExxonMobil are among the fund's top holdings, as are Microsoft, Johnson & Johnson, and JPMorgan Chase.
As a final thought, real estate investment trusts (REITs) can make excellent investments for older individuals, especially when held in tax-advantaged retirement accounts. Personal favorite Realty Income pays a 4.5% dividend, has increased its payout 93 times since its 1994 NYSE listing, and also has an excellent track record of market-beating returns.
