20 Dividend Stocks to Fund 20 Years of Retirement

The traditional wisdom for funding retirement used to be the "4% rule." You would withdraw 4% of your savings in year one, followed by "pay raises" in each subsequent year to account for inflation. The theory: If you're invested in a mix of dividend stocks, bonds and even a few growth stocks, your money should last across a 30-year retirement.

But today's world is different. Interest rates and bond yields have been stuck in the basement for far too long, reducing future expected returns. Compounding the problem: Americans are living longer than ever before.

If you're wondering how to retire without facing the uncomfortable decision of what securities to sell, or questioning whether you are at risk of outliving your savings, wonder no more. You can lean on the cash from dividend stocks to fund a substantial portion of your retirement. In fact, Simply Safe Dividends has published an in-depth guide about living on dividends in retirement.

Many companies in the market yield 4% or more. And if you rely on solid dividend stocks for that 4% annually, you won't have to worry as much about the market's unpredictable fluctuations. Better still, because you likely won't have to dig into your nest egg as much, you'll have a chance to leave your heirs with a sizable portfolio when the time comes.

Here are 20 high-quality dividend stocks, yielding on average above 4%, that should fund at least 20 years of retirement, if not more. They have paid uninterrupted dividends for more than 20 consecutive years, have fundamentally secure payouts and have the potential to collectively grow their dividends to protect investors' purchasing power over time.

Universal Health Realty Income Trust

Courtesy Marcus Qwertyus via Wikimedia Commons

Sector: Real estate

Market value: $1.4 billion

Dividend yield: 2.7%

Universal Health Realty Income Trust (UHT, $100.44) is a real estate investment trust (REIT) boasting 69 investments in health-care properties across 20 states. Nearly three-quarters of its portfolio is medical office buildings and clinics; these facilities are less dependent on federal and state health-care programs, reducing risk. But UHT also has hospitals, freestanding emergency departments and child-care centers under its umbrella.

The REIT was founded in 1986 and got its start by purchasing properties from Universal Health Services (UHS), which it then leased back to UHS under long-term contracts. UHS remains a financially strong company that accounts for about 20% of Universal Health Realty Income Trust's revenue today.

The firm has increased its dividend each year since its founding. However, unlike many dividend stocks that hike payouts once annually, UHT typically does so twice a year, albeit at a leisurely pace. The REIT's current 68-cent-per-share dividend is about 1.5% better than it was at this time in 2018.

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