Those in or near retirement face a daunting challenge: balancing the need for ongoing income to cover day-to-day expenses with generating sufficient growth in their portfolio to help it last a lifetime. While dividend stocks tend to take care of the first half of that equation, as a group, they are not necessarily known for being growth engines. There are companies out there, though, that make consistent dividend payments while still possessing an element of growth.

To help you track them down, we asked three Motley Fool investors to choose companies they believe have the best of both worlds. They offered convincing arguments for Starbucks Corporation (NASDAQ:SBUX), Apple Inc. (NASDAQ:AAPL), and Johnson & Johnson (NYSE:JNJ).

A watering can watering two young seedlings.

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Robust dividend growth ahead

Demitri Kalogeropoulos (Starbucks): Starbucks hasn't shown up on many income investors' radars thanks to the coffee giant's focus on expanding its sales base rather than returning capital to shareholders. But, as its latest 20% dividend hike suggests, that focus is shifting right now. And its rising payout has met with a sluggish stock price to produce unusually high income potential. In fact, Starbucks' yield crossed 2% for the first time in 2018.

The retailer aims to send roughly $5 billion to shareholders in each of the next three fiscal years. There's plenty of room for the dividend to rise to an increasing portion of those returns, too. Dividend spending was $1.4 billion in the latest fiscal year, or just less than half of Starbucks' overall earnings.

The good news is, retirees don't have to sacrifice growth potential to own this maturing dividend investment. Sure, Starbucks recently reduced its long-term financial goals, but the new targets still represent impressive goals, with sales rising by between 3% and 5% as earnings expand by about 12% annually.

Three different size Starbucks cups showing drinks drizzled with molten chocolate.

Image source: Starbucks.

Looking further out, Starbucks has many avenues available for boosting its sales base. The industry leader is just getting started in China, for example, and it has a good shot at increasing traffic in the U.S. over the next few years by bulking up its food menu. Those initiatives should support many more years of steady dividend growth ahead.

A growth story that's far from over

Danny Vena (Apple): Until recently, investors had been treating Apple as if its best days were behind it, based on fears about the slowing growth of its flagship iPhone. The company answered those concerns with stronger-than-expected growth in its most recent quarter, setting second-quarter records for revenue and profits. Revenue grew 16% year over year, while net income grew 25% compared to the prior-year quarter.

The highlight of Apple's financial results was the long-awaited update to the company's capital allocation plan. The company increased its quarterly dividend for the sixth time in as many years, increasing the payout by 16%, from $0.63 to $0.73 per share, currently yielding 1.56%. Even though the quarterly checks have nearly doubled over the last six years, the company still sports a payout ratio of less than 25%, leaving massive potential for ongoing increases.

Apple also revealed that the company had approved a new $100 billion share repurchase plan, signaling to the market that the stock was undervalued. Berkshire Hathaway (NYSE:BRK-A) (NYSE:BRK-B) CEO and legendary investor Warren Buffett seems to agree, purchasing a whopping 75 million Apple shares during the quarter, bringing the company's total shares owned to over 240 million. Those holdings are currently worth more than $46.5 billion, bringing Berkshire's stake in Apple up to about 5%.

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To counteract slowing iPhone growth, Apple has several aces in the hole. The company's services segment has been growing like gangbusters, with revenue up 31% year over year, now accounting for 15% of total sales. Apple plans to double its revenue from services to over $50 billion by 2020, and its run rate now tops $33 billion, so it's clearly on track to meet that goal. The company's other products segment, which includes the Apple Watch, AirPods, iPod Touch, Apple TV, Beats products, and the HomePod, has also produced impressive growth, which increased 38% compared to the prior-year quarter.

Apple's growth story is clearly not over, and with a growing record of rewarding shareholders via a generous capital return program, Apple may just be the perfect dividend stock for retirees.

A healthy stock for retirees

Dan Caplinger (Johnson & Johnson): Healthcare is a need every retiree increasingly appreciates, and Johnson & Johnson has covered the entire healthcare space for generations. By providing everything from Band-Aid bandages to the latest cutting-edge pharmaceutical treatments and medical technologies, Johnson & Johnson has grown into the colossus of the industry.

Four bottles of Johnson's baby care products.

Image source: Johnson & Johnson.

Retirees can appreciate the cash flow J&J generates to fund dividends. For 56 straight years, Johnson & Johnson has managed not only to pay dividends, but also to raise them, with the most recent boost of 7% having come just last month. That took the payout up to $0.90 per share every quarter, giving J&J's stock a 2.8% yield. Yet even with the boost, Johnson & Johnson will only pay out about 45% of what investors expect the company to earn in 2018.

At the same time, Johnson & Johnson still strives to grow. Its acquisition of Actelion has been a big revenue-producer, but the company's pharmaceutical segment has managed solid organic growth as well. In particular, strength in oncology has been able to make up for patent expirations elsewhere in the business. Johnson & Johnson overall has the capacity to keep growing, and that should continue providing the funding to pay the dividends that so many investors rely on from the healthcare giant.

Danny Vena owns shares of Apple and Starbucks. The Motley Fool owns shares of and recommends Apple, Berkshire Hathaway (B shares), and Starbucks. The Motley Fool owns shares of Johnson & Johnson and has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.