5 Retirement Stocks to Buy for a Growth Spurt

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Fifty years ago — when pension plans were the norm, social security payments meant something, and life spans were considerably shorter — owning the right retirement stocks wasn’t a significant concern. Times are changing, though, and it’s become considerably easier to outlive a retirement next egg.

hot growth stocks to buyThis advent of longer lives and higher (relative) costs has all but mandated that retirees rethink which stocks to buy for and during retirement. Income-only portfolio just won’t cut it any longer; you need at least some growth in order to keep the portfolio healthy enough to last the average 20 years or so it needs to last.

With that as the backdrop, here’s a closer look at five retirement stocks that blend income and growth within the reliable relatively steady consumer goods and services sectors.

In no particular order, these are five of the best retirement stocks to buy.

Retirement Stocks: Target Corporation (TGT)

tgt, Retirement stocks, stocks to buyNine times out of 10, the top name to own in a particular industry is also the biggest player in the business. The discounted-retail trade, though, calls for an exception to that rule — Target (TGT) tops Walmart (WMT) on a list of stable stocks to buy as a retirement holding.

Walmart is still a force to be reckoned with, to be sure. But, between customer services issues, employee-relation issues and constant restocking issues all within the past couple of years, it may be time for Walmart and its investors to acknowledge that the company has gotten a little too big and too out of touch for its own good.

Target Corporation, however, doesn’t suffer the same size problem. The stores are universally clean and fresh-looking, and it has merchandise on its shelves when and where it’s supposed to. Target simply has control of in-store execution that Walmart may or may not have again, and has room to grow that Walmart simply doesn’t have.

The current TGT dividend yield of 2.8% also qualifies it as one of those rare retirement stocks that brings income as well as growth to the table.

Retirement Stocks: Johnson & Johnson (JNJ)jnj stock, Retirement stocks, stocks to buy

Aside from food and water, one area where consumers will most assuredly keep spending is healthcare. Within that sliver of the market, Johnson & Johnson (JNJ) tops the list companies that make solid retirement stocks.

JNJ has a broad portfolio of low-end consumables, snack foods, over-the-counter products, medical devices, and a healthy prescription-drug business.

And, even if Johnson & Johnson breaks itself up to unlock value — as Jim Cramer recently suggested it should — current owners would still own several outstanding companies that could offer growth and income.

The kicker is the dividend. JNJ currently pays out 3% of its value, and the payout has steadily increased over the long haul.

Retirement Stocks: 3M Co. (MMM)

NYSE:MMMWith brand names ranging from Scotch tape to Nexcare bandages to its own 3M-branded sandpaper — and more — owning 3M Co. (MMM) is like owning a diversified mutual fund. While its consumer products are in a field of heated competition, 3M has the scale and reach to maintain and even grow market share.

For some current and about-to-be retirees, a dividend yield of only 2.7% might be a deal-breaker, erasing MMM from a list of retirement stocks to own. But, there’s more to 3M than meets the eye.

The company has faithfully raised its dividend every year since 1959. And those haven’t been nominal increases, either. On average, MMM stock’s payout doubles every nine years, and that’s in addition to the stock’s long-term capital appreciation.

Unilever plc (UL)

Unilever (NYSE:UL), Retirement stocks, stocks to buyLike 3M, Unilever plc (UL) is into a little of everything, very little of which consumers would ever give up — even in the most dire of circumstances. It’s the company that makes Dove soap, Lipton tea, and Magnum ice cream treats just to name few.

But product diversity isn’t the only thing that has earned UL a spot on the list of retirement stocks you can set and forget. Unilever, being a U.K.-based company, also offers geographic and currency diversity.

That’s a two-way street, mind you. When the dollar is strong as it is now, dividends from foreign corporations don’t go as far as they might when the dollar’s price is nominal. Given time, though, that imbalance will swing back in the other direction.

AT&T (T)

T stock, Retirement stocks, stocks to buyLast but not least, though there is the occasional exception to the rule that the biggest company in a sector is also the strongest investment in that sector, AT&T (T) isn’t one of them.

AT&T is the biggest name in the telecom bunch, and it uses that size to push around even the next-biggest name, Verizon Communications (VZ).

Yes, every other name in the telecom industry is taking aim at AT&T, but it doesn’t matter. AT&T is entrenched, and better-funded than most any competitor. It’s also the only name with enough reach and muscle to make something like the union with DirecTV (DTV) work.

Throw in the fact that it’s offering a dividend yield of 5.4%, and AT&T may be the best of the best among these retirement stocks.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/07/retirement-stocks-to-buy-tgt/.

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