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"Dividends don't matter in the accumulation phase; all that matters is total return. After all, you're not spending the money (yet) so why would it matter how much you are getting by way of dividends, and if that dividend stream was consistent or choppy? All that matters is how much you generate by way of total return and that typically consists of capital appreciation that can include the reinvestment of those dividends.
Now certainly I am a fan of dividends and dividend growth, those dividends are a sign of fiscal health and earnings power; and in the end there's that key phrase, it all comes down to the earnings power of the companies that you hold. Over time, the markets will reward the index or basket of companies that you hold with rising stock prices. In fact the market will also reward you with periods when some giddy buyers will actually offer you much more than your company is worth. Benjamin Graham says accept that offer to a degree. Mr. Graham also advised for the defensive investor (that's dividend growth investors) to select companies with at least a 20 year history of paying dividends. Many investors now of course insist on 10, 15 or 25 years of increasing dividends.
I am a big fan of dividend growth because it....READ MORE
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