Best Dividend Paying Stocks

Highest Dividend Stocks of 2009

     With the improvement of American balance sheets because of loss of appetite for credit, consumption falls, and with it, interest rates stay low.  There are many advantages available with receiving monthly dividends.  Accelerating the investor's return of capital, faster compounding for reinvested dividends, steadier cash flow, lower volatility and yields partially or completely tax free.

If you want your money to work for you, then one thing you can do is invest in equities that turn into dividends.  Long term dividends are taxed much less than short term dividends are, so it is a good idea to get some of these in your stock portfolio. 

You might be wondering what a dividend is, anyway.  A dividend is an amount of money that a company earns that is distributed to the company shareholders.  A dividend can be quoted as a dollar amount per share as a percent of the market price at the time.  The percentage quote is known as a dividend yield. 

In order to invest in a company that pays dividends to its shareholders, you must choose to buy individual stocks or a mutual fund that invests in companies that pay dividends.  For joint companies, dividends are distributed as a fixed amount per each share of stock.  Each shareholder gets a dividend that is in proportion to the amount of stock they own.  Paying dividends is not an expense for a company since is a portion of the profit a company makes before taxes.  Companies that issue dividends pay them on a fixed schedule, unless they declare a special dividend.  Money that is not paid out in dividends to shareholders is listed called retained earnings and are listed in the company balance sheet in the shareholder equity section.  A cooperative business distributes dividends based on the activity of its members.  These dividends are categorized as pre-tax expenses. 

Dividends can be distributed as cash or in the form of store credits when dealing with retail cooperatives.  Additional shares in the company can also be awarded as a dividend.  For public companies, the dividends can be reinvested into the company by purchasing additional shares of stock instead of taking a cash sum.  This is a good way to create more money for a share holder down the road.

Investing in a company that pays out dividends to its share holders is a great way to earn a little extra income.  While you must invest a particular amount early on, you will end up making more money in the future when those dividend checks come in the mail.  All you have to do is find a good company to invest in.  This site will show you the top companies for dividend returns on your money.

Four of the best dividend paying stocks of 2009 are:

• Realty Income
• Kinder Morgan Energy Partners
• Consolidated Edison
• Phillip Morris International

Some monthly Dividend Stocks with yields over 9%:

• Sabine Royalty Trust
• Realty Income Corp.
• PIMCO Municipal Income Fund III
• Aberdeen Asia-Pacific Income Fund Inc.
• Advent Claymore Convertible Securities & Income
• Van Kampen Senior Income Trust
• Reaves Utility Income Fund
• Precision Drilling
  
  
  

     For most of the 20th century, investors bought stocks solely for the dividends.  There was no such thing as accounting standards or SEC filing.

     After 1934, when they passed the SEC act, dividend or income investing still dominated the investment landscape until around thirty years ago, when investors became 'growth' obsessed.

     Dividends are a crucial element to any investment environment.

    If you are aware of the existence of these trends, and you'll be better able to detect investment opportunities and pitfalls in the years ahead.