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Fri. Aug. 14, 2009

Dividend Stocks: Lowering Risk By Increasing Dividends *

If your goal is to accumulate wealth for a comfortable retirement, then there is no risk-free path. Throughout time every angle has been tried and failed. Inherently, individual stocks will carry higher risk due to the lack of diversification when evaluated on a stand-alone basis. However, you can mitigate some of this risk by selecting solid dividend paying companies with a track record of increasing their dividends each year.

Below are several companies stepping forward in uncertain time and rewarding their shareholders with higher cash dividends:

Chemed (CHE) provides hospice services for patients with severe, life-limiting illnesses; and also provides plumbing and drain cleaning services. This past week, the company raised its quarterly dividend 100% to $0.12/share. The dividend is payable on September 4, 2009, to shareholders of record as of August 17, 2009. It is the 153rd consecutive quarterly dividend paid by Chemed in its 38 years as a public company. The current yield based on the new dividend is 1.10%.

Broadridge Financial (BR) provides technology-based outsourcing solutions to the financial services industry. On Tuesday, the company increased its annual dividend for fiscal year 2010 to $0.56/share from $0.28/share. The current yield based on the new dividend is 2.86%.

Equity LifeStyle Properties (ELS) is a real estate investment trust owns and operates manufactured housing communities throughout the U.S. Earlier this week, the company boosted its quarterly dividend 20% to $0.30/share. The dividend will be paid on October 9, 2009 to shareholders of record on September 25, 2009. The current yield based on the new dividend is 2.80%.

Kinross Gold (KGC) is the fourth largest primary gold producer in North America and is the fifth largest in the world. The company has nine mines in Canada, the U.S., Brazil, Russia and Chile. Yesterday, the company boosted its quarterly dividend by 25% to $0.05/share. The current yield based on the new dividend is 1.01%.

Consolidated Water (CWCO) develops and operates seawater desalination plants and water distribution systems in the Cayman Islands, Belize, the British Virgin Islands, and The Bahamas. Thursday, the company increased it quarterly dividend to $0.075/share. The current yield based on the new dividend is 1.50%.

Connecticut Water Service (CTWS) is a provider of regulated water utility services to customers in Connecticut also conducts unregulated operations. On August 12th, the company increased its quarterly dividend by 2.2% to $0.2275/share. The dividend is payable September 15, 2009, to shareholders of record as of September 1, 2009. The ex-dividend date is September 29. CTWS is a Dividend Champion that has increased its dividend for 40 consecutive years. The current yield based on the new dividend is 4.08%.

Many companies have chosen to reward their shareholders with annual dividend increases. For stocks with a long string of consecutive dividend increases, see this list.

Full Disclosure: No position in the aforementioned stock. See a list of all my income holdings here.

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