Our Philosophy

Retirement is supposed to be a relaxing time in life. A time when you finally get to reap the rewards of saving money for 40 + years. Yet it seems like more and more retirees are worried.

  • Will your retirement savings last?
  • Have you chosen the right investments for retirement?
  • Are you worried about the daily or weekly price fluctuations of your investments?
  • Will you be able to leave anything to your children or grandchildren?

This is not how it should be, and we at the 4% Portfolio have a better way.

Our model retirement portfolio’s focus is on generating safe and reliable retirement income. Advertising “4%” may seem strange when other newsletters and stock investment websites are talking about double and triple digit gains, or “12%” income, but those types of promises rarely pan out. Our pledge of generating 4% in income is based on a strong, established history of a stock’s dividend payment.

Those who don’t know their history are doomed to repeat it.


We like to think of this in a different way.

Those who know their history can reap its rewards.  


The 4% Portfolio contains financially sound companies spread across multiple industries who have a history of rewarding their investors with consistent dividend payments. The average number of years that a company has been paying a dividend in our Portfolio is over 40 years.

Our Investment Philosophy

Although a company’s dividend yield is important, it is a small piece of what we look at when evaluating a stock. Just because a company has a high dividend yield doesn’t mean it makes the cut. In fact, a high dividend yield could be a bad sign for a company’s financial future. We have performed exhaustive research and combed through thousands of financial statements in order to choose what companies qualify to be included in the 4% Portfolio. Safety and reliability are the two most important aspects we look for, and we can determine this by looking at the following:

  • Dividend History – A company must demonstrate a strong dividend history. A history of consistency and growth.
  • Manageable Debt – High debt means high debt payments which could adversely affect a company’s dividend. We look for companies with a manageable debt load.
  • Cash on hand – Sometimes businesses lose money due to various internal or external issues. If so, we want to make sure they have plenty of cash on hand to still be able to pay its dividend and ride out the bad times.
  • Dividend Payout Ratio – Although we want to be paid a high dividend, we don’t want that payment to take up most or all of the company’s cash that it earned as some of it needs to be used to fund future growth or reduce debt.
  • Low Volatility – We look for stocks with low volatility vs the rest of the market. High volatility has no place in a retirement account.
  • Growth – If a company is not growing, then its dividend’s future could be in jeopardy. Also, growth will fund future dividend increases. Just because you’re retired doesn’t mean you shouldn’t get a raise.
  • Independent Analysis – Although we are thorough in our research, we still utilize outside, independent analysis of a company’s financial health to further ensure its financial stability.

The 4% Portfolio is made up of stocks that meet the above criteria and, when invested evenly among each of the stocks, will yield at least 4% in annual dividend income.

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