What’s Surer Than Cash in Your Account?

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The answer is NOTHING!

Earnings can be suspicious as a result of creative accounting…

Revenues can be booked in one year or several…

Capital assets can be sold and the value listed as ordinary returns…

But cash deposited in your account is a sure thing. It is strong confirmation of a company’s real power, its earnings. Cash is tangible evidence of a business’s success.

This said, dividend-paying stocks may not be thrilling or adrenalin bursting investments, but businesses that are stable and make regular payments are the ones that, at the end of the day, make investors rich.

In case you want to give them a try, here we give you 4 important terms you should understand when investing in dividend-paying stocks:

- Declaration date
This is the date on which a company’s board of directors makes known the amount of the next stock dividend and its ex-dividend date, record date and payment date.

- Ex-Dividend date
This is the date on which the stock trades without a dividend. In other words, if you buy the stock on or after this date, you will not be entitled to the next dividend.

If you decide to sell the stock before the ex-dividend date, the buyer will receive the dividend instead of you.

On the contrary, if you sell after the ex-dividend date, you will receive the dividend, not the buyer.

- Record date
This is the date on which a company establishes the list of shareholders that qualify for the dividend. To be on the list, you have to own the stock at least one day before the ex-dividend date.

- Payment date
This is the date on which the stock dividend is paid to the shareholders of record. Shareholders receive either a dividend check or the money is deposited in their accounts.

Dividend-paying stocks may be the thing missing from your investment portfolio to ensure a steady growth of your bottom line.

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