In this article, we discuss the best retirement portfolio for a 65-year-old.
The American retirement system is feeling the strain, with challenges like shrinking fees, underfunded plans, and an aging population slowing down industry growth. Over the last decade, 401(k) expense ratios have declined by a third, according to a PwC report, and recordkeeping fees dropped 8% between 2015 and 2019, making it harder for retirement firms to stay profitable. Some companies have had to merge or shut down, but there is still a big opportunity. Businesses that offer better retirement benefits, financial advice, and affordable plans for small companies could attract more people and unlock an extra $5 trillion in retirement savings.
The urgency is real. A quarter of US adults have no retirement savings at all, and only 36% feel on track. Even those who are saving may not have enough. For people nearing retirement, between the ages of 55 to 64, the median savings of $120,000 might provide less than $1,000 a month for 15 years. This is hardly enough, especially with longer life expectancies and rising healthcare costs.
For most Americans, retirement means either living off of savings or finding ways to generate passive income. While some can count on Social Security or a pension, many have to plan their own financial future. Savings usually involve withdrawing money over time, while passive income could mean anything from rental properties to online businesses. Brian Bollinger, founder of Simply Safe Dividends, believes dividend-paying stocks can be a game-changer. Instead of selling stocks to make money, retirees can rely on regular dividend payments, helping stretch their savings.
Dividends have been a huge part of stock market returns, making up about 45% of the broader market’s total gains since 1900. But despite their importance, they are often overlooked when planning for retirement, especially as baby boomers look for reliable income sources. According to Thornburg Investment Management, retirees typically fund expenses through either a total return approach, investing for growth and selling assets as needed, or a high-income approach, relying on high-yield investments for steady income. The first risks selling in down markets, while the second limits portfolio growth. A better strategy combines both; investing in stocks that not only pay dividends but also increase them over time can provide a steady income while allowing retirees to grow their wealth. Unlike bonds with fixed returns, dividend stocks can grow income, offering both stability and long-term financial growth. Over 30 years, dividend income has outpaced bond payouts, making it a strong option for retirees. With that investing strategy in mind, let’s take a look at the best retirement portfolio for a 65-year-old.
Image by Carabo Spain from Pixabay
Our Methodology
For this article, we searched the internet for widely recommended retirement stocks and selected those with at least a decade of consistent dividend growth and an average 5-year return of 50% or more as of March 24. We also selected stocks from different industries to make a well-rounded portfolio. Additionally, we have mentioned the hedge fund sentiment for each stock, as per Insider Monkey’s database of Q4 2024, and ranked the list based on that data.
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. Agilent Technologies, Inc. (NYSE:A)
Number of Hedge Fund Holders: 55
Number of Consecutive Years of Dividend Growth: 13
Average 5-Year Share Price Returns: 81.69%
Agilent Technologies, Inc. (NYSE:A) develops solutions for life sciences, diagnostics, and applied chemical markets. The company provides lab instruments, automation technologies, genomics and pathology solutions, biomolecular and cell analysis tools, as well as maintenance, training, and consulting services. Agilent is one of the top choices for the best retirement portfolio. On March 24, the company helped Autolus Therapeutics get FDA approval for AUCATZYL, a CAR T therapy, by providing its xCELLigence Real-Time Cell Analysis technology.
Agilent Technologies, Inc. (NYSE:A) reported $1.68 billion in revenue for the first quarter of 2025 ending January 31, a slight increase of 1.4% from last year. GAAP net income came in at $318 million, down from $348 million in Q1 2024, while non-GAAP net income was $377 million, staying close to last year’s $380 million. For the full year 2025, Agilent expects revenue between $6.68 billion and $6.76 billion, with growth projections of up to 3.8%. Non-GAAP earnings per share are forecasted between $5.54 and $5.61.
On February 19, Agilent Technologies, Inc. (NYSE:A) declared a quarterly dividend of $0.248 per share, in line with the previous. The dividend is payable on April 23 to shareholders on record as of April 1. Agilent has consistently raised its dividend payouts for the last 13 years.
According to Insider Monkey’s fourth quarter database, 55 hedge funds were bullish on Agilent Technologies, Inc. (NYSE:A), compared to 44 funds in the prior quarter. David Blood and Al Gore’s Generation Investment Management is the leading stakeholder of the company, with 4.15 million shares valued at $558.7 million.
9. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 60
Number of Consecutive Years of Dividend Growth: 29
Average 5-Year Share Price Returns: 136.33%
International Business Machines Corporation (NYSE:IBM) delivers technology solutions worldwide, focusing on AI, cloud computing, consulting, and infrastructure. It also offers financing to help clients acquire its products and services. On March 18, the company announced that it is collaborating with NVIDIA to make AI more powerful and accessible for businesses. The plan is to integrate NVIDIA’s AI Data Platform into IBM’s hybrid cloud setup, helping companies better manage data and scale AI efficiently. IBM Consulting is also stepping in to help companies automate workflows using NVIDIA’s AI tools.
In 2024, International Business Machines Corporation (NYSE:IBM)’s revenue grew 3%, and the company generated $12.7 billion in free cash flow, the highest in years. Software was a major driver, growing 9%, while RedHat saw double-digit growth. Revenues in Infrastructure stayed on track, and although Consulting revenue fell slightly short of Wall Street estimates, IBM’s investments in AI and partnerships are expected to boost future growth. Software now accounts for 45% of the company’s business, with over $15 billion in recurring revenue. Q4 was particularly strong, with 11% revenue growth, led by RedHat’s 17% jump. The company’s generative AI business is also gaining momentum, reaching $5 billion in total contracts. IBM ended the year in a solid financial position, with $14.8 billion in cash, lower debt, and over $6 billion returned to shareholders.
On January 28, International Business Machines Corporation (NYSE:IBM) announced a quarterly cash dividend of $1.67 per share, which was paid on March 10, 2025. This continues the company’s tradition of consistent dividend payments, maintaining an unbroken streak that dates back to 1916. The company has also increased its payouts for 29 consecutive years, making it one of the top stocks for the best retirement portfolio.
According to Insider Monkey’s Q4 data, 60 hedge funds were bullish on International Business Machines Corporation (NYSE:IBM), compared to 56 funds in the last quarter.
Hedge Fund Resource Center