3 Dividend Growth Stocks That Can Double Your Income

"Many investors focus on the dividend yield, but not much on the dividend growth. This is a mistake, as dividend growth is a key factor that matters a lot in the long run. A dividend growth stock can significantly outperform a dividend stock that pays a static yield. If a 2% yield grows at a 10% CAGR over 10 years, it becomes 5.19%. Yield can then snowball more in future decades."

"Also, stocks with dividend growth tend to have faster-growing businesses. You may immediately go for a tech stock like , but I wouldn't recommend that. The aim is to buy and hold these stocks for decades, and it is a big gamble to assume that tech companies will retain their dominance. The tech scene has changed drastically in the last 20 years; no one knows what may happen in the next 20 years."

"is a supplemental insurance company covering out-of-pocket costs that primary insurance companies don't. The biggest plus is that Aflac gives you cash directly, meaning you decide where you get to spend the insurance money. Japan and the U.S. are two of Aflac's biggest markets, and both are growing. 60% of revenue comes from Japan, where the insured population is highly loyal to the company."

Dividend growth matters more than current yield because rising payouts compound returns and can vastly increase yield over decades; a 2% yield growing 10% annually becomes 5.19% in ten years. Stocks that raise dividends often have faster-growing underlying businesses. Long-term dividend growth investing favors established, durable companies rather than high-risk technology firms that may lose dominance over decades. Aflac provides supplemental insurance and pays cash directly to policyholders; Japan and the U.S. are its largest markets, with about 60% of revenue from Japan. Aflac has improved capital returns and reduced outstanding shares from 918.8 million in 2013 to 549.96 million in 2024.

Read at 24/7 Wall St.