Recently, I read an article which said something to the effect that if the inflation rate is 3% and if we are not growing our monies above this 3% inflation rate, then we are losing monies every second. While the above is theoretically sound, I would like to caution that statements like this may propel some investors to seek high-dividends stocks like Reits to offset the cost of inflation and in parallel grow their wealth.
There is nothing wrong with investing for dividends income but just don’t be too fixed at it since dividends received from stocks including Reits are not guaranteed or guaranteed to be a certain decent amount every time. The bottomline of every stock is the business and hence if the business is not doing well, investors may experience capital non-profits which can overwhelm what annual dividends the investors are achieving from the stocks.