John Heinzl writing every Wednesday in the Globe and Mail about dividend stocks noted his investments did what they were expected to do and all is good. Mr. Heinzl predicted Johnson & Johnson or J&J and Proctor and Gamble (P&G) would raise their dividends in April. They both did. Reliable dividend growth is one very good reason to own these stocks and the premises profitable companies which increase their dividends is a very good way to increase your wealth with relatively low risk. Mr. Heinzl looks at what if you had bought $10,000 worth of shares in J&J 20 years ago?  Those shares would not pay you $1,875 a year in dividends; the value would have grown to $105,000 and you average return would be 12.5% a year.

J&J is in the health care field and with a rapidly aging baby boom, health care expenditures go up for we as humans need more health care at the beginning of our lives and the last 10 years of a mythical average person. In today’s low-interest environment averaging a 12.5% return on your investment with limited risk is a great return.

Linking to dividend paying stocks, there are multiple ways to invest, trying to lower the risk and maintain a healthy return is often a challenge which is made simpler investing in quality companies which are both profitable and have a history of raising their dividends over the years, J&J is a great example and there are other companies out there.

There are more questions than answers, till the next time – to raising questions.