According to my generations chart, the last of the baby boomers should be reaching retirement age this year. In retirement, stable income is a paramount concern. For my clients, I aim to achieve sufficient living income through dividends. It's not as simple as simply trading a portfolio of growth stocks for dividend stocks upon reaching retirement. Rather, we gradually shift the portfolio's focus as retirement approaches.

Stock sectors with strong dividends typically include financials, energy, and utilities. We prefer to select individual stocks rather than a fund to ensure our clients are investing at appropriate valuations.

Alternatives to dividend stocks include REITs fixed-income securities. We view the former as another stock sector, even though it's technically different. As for fixed-income securities, while these often provide higher yield, they remain exposed to inflation risk. With stocks, inflation causes short term volatility, but over the long-term stocks are a textbook inflation hedge.