Would you explain the difference between growth stocks and income stocks?
Growth stocks, as their name suggests, offer above-average growth that exceeds the rate of inflation. If you are seeking to benefit from your investments in five years or more and don’t need current income, you'll probably benefit more by investing in growth stocks, especially if they are in a tax-sheltered retirement account such as IRA or 401(k) plan.
Income stocks provide relatively high-paying dividends; utilities used to be in this category until 1993-1994. There is a trade off between income and growth. Many retirees in their 60s mistakenly seek to maximize their current returns or current incomes by forsaking growth in their portfolios. These retirees are positioning themselves to be victimized by inflation if they live a normal or longer than-normal life span.
Growth stocks, as their name suggests, offer above-average growth that exceeds the rate of inflation. If you are seeking to benefit from your investments in five years or more and don’t need current income, you'll probably benefit more by investing in growth stocks, especially if they are in a tax-sheltered retirement account such as IRA or 401(k) plan.
Income stocks provide relatively high-paying dividends; utilities used to be in this category until 1993-1994. There is a trade off between income and growth. Many retirees in their 60s mistakenly seek to maximize their current returns or current incomes by forsaking growth in their portfolios. These retirees are positioning themselves to be victimized by inflation if they live a normal or longer than-normal life span.
No comments:
Post a Comment