In this article, we will take a look at some of the best dividend stocks for retirement.
Dividend stocks are considered a good option for retirees because they tend to offer stability during difficult market periods. A report from Morningstar noted that funds focused on dividend-paying stocks were better able to handle the tech crash between 2000 and 2002, mainly because they had little exposure to the technology sector. During that time, the Vanguard Total Stock Market Index recorded a cumulative loss of nearly 44 percent due to sharp declines in growth stocks, while dividend-focused funds experienced only about one-third of that drop.
The most reliable retirement stocks tend to offer a blend of attractive dividend yields and stable payouts that can hold up during economic downturns.
For income-focused investors, particularly retirees, high-yield stocks are often a top choice because they offer dividends well above the market average. At present, the average dividend yield of the S&P 500 sits at around 1.2%. However, a high yield alone isn’t enough. It’s also crucial that these companies have strong and dependable dividend policies to ensure consistent income over time.
Given this, we will take a look at some of the best dividend stocks for retirees.
Photo by Diana Parkhouse on Unsplash
Our Methodology
For this list, we used a screener to select dividend stocks that have shown strong and consistent dividend policies and are spread across various industries, making them suitable for a retirement stock portfolio. From the initial selection, we chose 10 stocks, each from a different industry, that were famous among the hedge fund investors, as per Insider Monkey’s Q1 2025. The stocks are ranked according to hedge funds having stakes in them.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. Aflac Incorporated (NYSE:AFL)
Number of Hedge Fund Holders: 38
Aflac Incorporated (NYSE:AFL) stands out as a major player in the supplemental insurance market in both the United States and Japan, offering policies related to life, cancer, and general health coverage. Its operations in Japan play a particularly important role in driving overall profits. The company’s growth strategy centers on enhancing its product lineup, introducing innovations, and strengthening its sales reach through strategic partnerships.
In the first quarter of 2025, Aflac Japan maintained a strong premium persistency rate of 93.8% and achieved a 12.6% year-over-year increase in sales. Aflac Incorporated (NYSE:AFL) has continued to emphasize its third sector offerings, particularly the new cancer insurance product, Miraito. These policies are also being introduced to a younger customer base through Tsumitasu, a first-sector product.
In the United States, Aflac Incorporated (NYSE:AFL) reported a premium persistency rate of 79.3%. It also recorded a 1.8% increase in net earned premiums and a 3.5% rise in overall sales, reflecting steady performance in the domestic market.
Aflac Incorporated (NYSE:AFL) offers a quarterly dividend of $0.58 per share and has a dividend yield of 2.35%, as recorded on July 30. AFL is one of the best dividend stocks for retirement, as the company holds a 42-year streak of consistent dividend growth.
9. Emerson Electric Co. (NYSE:EMR)
Number of Hedge Fund Holders: 39
Emerson Electric Co. (NYSE:EMR) is an American manufacturing company that offers products and services related to commercial, industrial, and consumer markets. The company has undergone a significant transformation in recent years, emerging as a more focused company with stronger long-term growth potential. The business is now centered around key areas such as process and industrial automation, industrial software, and related fields like automated test and measurement.
According to management, Emerson Electric Co. (NYSE:EMR) is positioned to achieve revenue growth of 4% to 7% across economic cycles. By shifting more toward software-defined automation, the company also expects to improve its profit margins. This strategy is aimed at delivering double-digit earnings growth and generating free cash flow margins between 15% and 18% over time.
In addition, Emerson Electric Co. (NYSE:EMR) is a solid dividend payer. The company holds one of the longest streaks in the market, spanning over 67 years, which makes it one of the best dividend stocks to consider for retirement. It currently pays a quarterly dividend of $0.5275 per share and has a dividend yield of 1.44%, as of July 30.
