Dividend income is great, but over time inflation can chip away at the purchasing power it generates for you. This is why it's important to invest in dividend stocks that also increase their payouts over time. A couple of companies that have been raising their dividend payments in recent years and that could announce big increases next year are Eli Lilly (LLY 1.85%) and Microsoft (MSFT 0.12%).

1. Eli Lilly

Eli Lilly's business is strong and full of attractive growth prospects. Weight-loss drug Mounjaro could bring in tens of billions in revenue for the company and its Alzheimer's treatment, donanemab, may also be one of its top products in the not-too-distant future. If they get the green light, the outlook appears very promising for Eli Lilly. And today they serve as a couple of examples as to why investors aren't flinching at the stock's rich price-to-earnings multiple -- about 50 at present.

One underwhelming part of Eli Lilly's stock is its dividend. At just 1.2%, the yield is far below the S&P 500 average of 1.7%. However, with the stock achieving returns of more than 30% this year, investors are likely more than happy with their overall investment in the healthcare company.

Plus, it wouldn't be surprising to see the stock announce a big increase to the payout next year, especially if its growth prospects strengthen due to Mounjaro or donanemab. This week, the company announced a 15% increase to its quarterly dividend, now paying investors $1.13 every quarter. This marks the fifth consecutive year that Eli Lilly has increased its payouts by at least 14%.

And with more growth ahead and a payout ratio of around 70%, odds are there will be another generous rate hike next year as well.

2. Microsoft

Tech giant Microsoft is another company that may feel generous next year. Its yield is similar to Eli Lilly's and its payout ratio of just 27% is much lower. Earlier this year, Microsoft announced a 10% increase to its dividend, which marked the 20th straight year that it has raised its payouts

The company, known for its Windows operating system and Microsoft 365 office software, is in the midst of acquiring video game maker Activision Blizzard which, if it can get approval from regulators, would be a big win for the business and lead to more growth opportunities.

But even if that doesn't happen, with Microsoft still delivering strong results -- its sales of $50.1 billion for the period ended Oct. 25 were up 16% when factoring out the impact of foreign currency -- the company could be in a great position to announce a big rate hike. And as the economy approaches a potential recession next year, Microsoft may see an incentive to divert cash from growth initiatives and instead allocate more money to its dividend.

Although Microsoft's business is hugely profitable and stable, the growth stock is down more than 25% this year. By offering a higher-yielding dividend, the stock could attract more types of investors. And with the resources to be able to do that, Microsoft could be overdue for a significant increase to the dividend.

Shares of Microsoft are currently trading at 27 times earnings, which is slightly below its five-year average of 28. With the stock well on its way to becoming a Dividend Aristocrat in the future and still uncovering ways to grow its business, Microsoft is the type of investment you can safely hold in your portfolio for years.