It’s a shame that most of us finish school with only a modicum of real financial literacy.

Most high school graduates – and many college graduates – do not know how to calculate compound interest… or what a 401(k) is… or what an adjustable-rate mortgage is… or why we even have a stock market.

Even those who have a good basic understanding of economics and finance often find the investment process challenging. There are so many alternatives… so many claims… so much jargon.

[ad#Google Adsense 336×280-IA]Fortunately, my Investment U colleague Marc Lichtenfeld has a talent for making the often-complicated path to financial independence plain and simple.

And I’m not the only one who recognizes it.

Last week, the Institute for Financial Literacy – a nonprofit 501(c)(3) tax-exempt organization that promotes effective financial education and counseling – announced the winners of the 2016 Excellence in Financial Literacy Education (EIFLE) Awards.

The EIFLE Awards were created to acknowledge the innovation, dedication and commitment of those who support financial literacy education.

This year’s competition was impressive and diverse, with hundreds of submissions. Yet the winner for Adult’s Book of the Year for Investment and Retirement Planning was Marc’s Get Rich With Dividends: A Proven System for Earning Double-Digit Returns.

I won’t claim to be unbiased.

I was honored that Marc asked me to write the forward to the book. And now the second edition is gaining the recognition it deserves as an investment classic.

Marc shows the reader how and why to invest in the best dividend stocks. And you could not find a more worthy, knowledgeable or trustworthy guide.

His investment approach works. In spades.

For several years now, Marc has written the highly regarded Oxford Income Letter. Along the way he has established a formidable track record – and made me a true believer.

At investment seminars, I often tell attendees that if you are looking for growth, invest in dividend stocks. If you are looking for income, invest in dividend stocks. If you are looking for safety, invest in dividend stocks.

Why? Earnings may be suspicious due to creative accounting. Revenues can be booked in one year or over several years. Capital assets can be sold and the value listed as ordinary income. But cash paid into your account is a sure thing, a litmus test of a company’s true earnings.

It’s tangible evidence of a firm’s profitability.

Regular payouts impose fiscal discipline on a company. And history reveals that dividend-paying stocks are both less risky and more profitable than most stocks.

Dr. Jeremy Siegel, a professor of finance at the Wharton School of the University of Pennsylvania, has done a thorough historical investigation of the performance of various asset classes over the last 200 years, including all types of stocks, bonds, cash and precious metals. His conclusion? High-dividend payers have outperformed the market by a wide margin over the long haul.

There is an awful lot of fear and anxiety about the economy and the stock market today. Investors are understandably confused and uncertain about how to secure their retirements.

But Marc demonstrates that even during periods of market declines, dividend-paying stocks hold up better than nondividend-paying stocks and often fight the broad trend and rise in value.

The reason is obvious. These tend to be mature, profitable companies with stable outlooks, plenty of cash and long-term staying power.

Of course, an investor would be foolish to plunk for a stock just because the dividend is large. You have to be selective. The market is full of “dividend traps”: troubled companies that pay hefty dividends but don’t have the ability to sustain them.

Marc shows you how to avoid these companies and reap big gains instead by focusing on companies with rising sales, sustainable profit margins and reasonable payout ratios.

Albert Einstein famously said that money compounding “is the most powerful force in the universe.” And the best way to compound your money? By owning great companies that pay steady, rising dividends quarter after quarter.

To learn more about Get Rich With Dividends – or to pick up a copy at 23% off the cover price – click here.

Good investing,



Source: Investment U