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.
8. Public Storage (NYSE:PSA)
Number of Hedge Fund Holders: 42
Public Storage (NYSE:PSA) is a real estate investment trust (REIT) that focuses on acquiring, developing, owning, and managing self-storage properties. As of June 30, 2025, the company owned or operated 3,432 self-storage facilities across 40 US states, totaling around 250 million net rentable square feet.
In addition to its US operations, Public Storage (NYSE:PSA) also held a 35% equity stake in Shurgard Self Storage Limited, listed on Euronext Brussels. Shurgard owns 321 self-storage facilities across seven countries in Western Europe, representing roughly 18 million net rentable square feet, all operating under the Shurgard brand.
In the second quarter of 2025, Public Storage (NYSE:PSA) reported a strong cash position. The company ended the quarter with over $1.1 billion available in cash and cash equivalents, up from $447.4 million at the end of December 2024. Though the company does not hold any dividend growth streak, it has paid regular dividends to shareholders since 1996. PSA currently offers a quarterly dividend of $3.00 per share and has a dividend yield of 4.16%, as of July 30.
7. Altria Group, Inc. (NYSE:MO)
Number of Hedge Fund Holders: 49
Altria Group, Inc. (NYSE:MO) is among the best dividend stocks to buy for retirement. The company mainly generates its revenue by selling nicotine-based products, with cigarettes accounting for the majority of its income. While nicotine isn’t an essential item, its addictive nature means that consumers typically continue purchasing their preferred form of consumption regardless of economic conditions.
In the second quarter of 2025, Altria Group, Inc. (NYSE:MO) reported revenue of $6.1 billion, which fell by 1.7% from the same period last year. The company remained focused on advancing its long-term Vision while sustaining the strength and profitability of its core operations. Within the oral tobacco segment, the product “on!” demonstrated strong performance and served as the primary contributor to the segment’s growth during the period.
Altria Group, Inc. (NYSE:MO) also demonstrated a stable cash position in the second quarter. At the end of the period, the company had nearly $1.3 billion available in cash and cash equivalents. It also returned $1.7 billion to shareholders through dividends, showing its commitment to investor return. In addition, the company is a Dividend King with 55 consecutive years of dividend growth under its belt. The company offers a quarterly dividend of $1.02 per share and has a dividend yield of 6.63%, as of July 30.
6. Target Corporation (NYSE:TGT)
Number of Hedge Fund Holders: 62
Target Corporation (NYSE:TGT) is an American retailer known for its chain of discount department stores and hypermarkets. The company has been making strides in several critical areas. Efforts to manage costs effectively have contributed to a 19% year-over-year increase in operating income. It continues to excel in its omnichannel strategy, with digital comparable sales rising 4.7% in the first quarter and same-day delivery sales through its membership program growing by 35%.
To enhance efficiency and responsiveness, management has launched a new enterprise acceleration office aimed at using technology and data to boost connectivity and agility across the organization. This initiative is designed to improve operational speed and functionality, further strengthening Target Corporation (NYSE:TGT)’s digital capabilities.
In addition, Target Corporation (NYSE:TGT) is also grabbing investors’ attention due to its consistent dividend policy. In June this year, the company declared a 2% hike in its quarterly dividend to $1.14 per share. Through this increase, the company stretched its dividend growth streak to 54 years, which makes it one of the best dividend stocks for retirement. The stock has a dividend yield of 4.42%, as of July 30.
5. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 65
Colgate-Palmolive Company (NYSE:CL) is a major player in the global household and personal care industry. The company holds a dominant position in the Oral Care segment. As of the current year, it commands a 40.9% share of the global toothpaste market and 31.9% in manual toothbrushes. Its products are available in more than 200 countries, reinforcing its widespread presence. Recently, the company has placed greater emphasis on sustainability efforts while continuing to strengthen its leadership across different product categories.
Colgate-Palmolive Company (NYSE:CL) holds one of the strongest dividend histories in the market. The company has paid uninterrupted dividends to shareholders since 1895 and has raised its payouts for 62 years in a row. It currently offers a quarterly dividend of $0.52 per share for a dividend yield of 2.42%, as of July 30. It is among the best dividend stocks to invest in for retirement.
4. Lowe’s Companies, Inc. (NYSE:LOW)
Number of Hedge Fund Holders: 68
Lowe’s Companies, Inc. (NYSE:LOW) has been operating for over 100 years and was once the top home improvement retailer in the United States. Today, it ranks second behind Home Depot, with more than 1,700 stores across the country. While the company once had an international presence, it has since exited markets such as Australia, Mexico, and Canada.
Lowe’s Companies, Inc. (NYSE:LOW) caters to both DIY homeowners and professional contractors, offering a wide range of products, including construction materials, tools, home appliances, and gardening supplies. The company maintains its competitive strength through a trusted brand name, an efficient supply chain, and a successful omnichannel model that supports its leadership in the industry. Backed by solid operations and a careful financial strategy, the company seems well-equipped to sustain its dividend growth over the long term.
In addition, Lowe’s Companies, Inc. (NYSE:LOW) holds a strong dividend history. The company has paid regular dividends to shareholders since 1961, while raising its payouts for 60 years in a row. LOW pays a quarterly dividend of $1.20 per share and has a dividend yield of 2.11%, as of July 30.
3. PepsiCo, Inc. (NASDAQ:PEP)
Number of Hedge Fund Holders: 71
PepsiCo, Inc. (NASDAQ:PEP) is among the best dividend stocks to buy for retirement. The food, snack, and beverage company is garnering investors’ attention because of its solid earnings in the second quarter of 2025. During the quarter, the company gained an advantage from a softer US dollar, which helped boost its foreign exchange results. A weaker dollar increases the value of international revenue when converted back into US dollars. The company also experienced a stabilization in volume trends, with convenient foods seeing a 2% decline and beverage volumes remaining steady.
PepsiCo, Inc. (NASDAQ:PEP) has been concentrating on controllable areas by strengthening its marketing around key brands and offering more affordable options through varied packaging sizes. During its second-quarter earnings call, the company outlined several international cost-saving initiatives. These included shutting down two facilities to better match production with demand, cutting fixed expenses, enhancing its enterprise resource planning system, tightening travel and spending policies, reevaluating third-party contracts, and increasing overall efficiency.
PepsiCo, Inc. (NASDAQ:PEP) has been rewarding investors with growing dividends for the past 53 consecutive years. The company pays a quarterly dividend of $1.4225 per share and has a dividend yield of 3.98%, as of July 30.
2. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 81
Chevron Corporation (NYSE:CVX) produces and markets a variety of top-grade refined products, such as gasoline, diesel, aviation and marine fuels, premium base oils, finished lubricants, and fuel additives. The company’s balance sheet is a key strength that investors shouldn’t ignore. With a debt-to-equity ratio of just 0.2 at the end of the second quarter, the company stands out as one of the financially strongest among its integrated energy peers. While market watchers often focus more on oil prices and global events, Chevron’s resilience is closely linked to its solid financial foundation.
A recent example of this strength is its $53 billion acquisition of Hess, a move that reflects not only Chevron Corporation (NYSE:CVX)’s scale but also its financial capacity to take on major strategic deals.
Chevron Corporation (NYSE:CVX)’s dividend policy is also very significant for income investors. The company has been increasing its dividends for 38 consecutive years. It currently pays a quarterly dividend of $1.71 per share and has a dividend yield of 4.45%, as of July 30.
1. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 91
Johnson & Johnson (NYSE:JNJ) stands out as a financially strong company, being one of only two firms globally with a perfect AAA credit rating, higher than that of the US government. By the end of the second quarter, it reported net debt of $32 billion, made up of $51 billion in total debt offset by $19 million in cash. This is relatively modest considering the company’s market capitalization exceeds $400 billion.
Johnson & Johnson (NYSE:JNJ)’s diversified healthcare operations produce strong and consistent cash flow. Last year, the company generated $20 billion in free cash flow, even after allocating around $17 billion toward research and development, roughly 19.4% of its total sales. This level of R&D spending placed the firm among the top investors in innovation across all industries. Despite its substantial R&D commitments, J&J still had more than enough free cash flow to cover its $11.8 billion in dividend payouts, leaving the company with significant surplus funds.
Johnson & Johnson (NYSE:JNJ) holds a 63-year track record of consistent dividend growth, which makes it one of the best dividend stocks for retirement. The company currently offers a quarterly dividend of $1.30 per share and has a dividend yield of 3.11%, as of July 30.
While we acknowledge the potential of JNJ to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than JNJ and that has 100x upside potential, check out our report about this cheapest AI stock.
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