There comes a point during our quest towards retirement, or financial freedom, that we must focus on an income stream to pay for the bills.

That’s where dividend income stocks come into play. It’s the point in time where your retirement portfolio is now generating your income and paying the bills.

Why Dividend Income Stocks?

Investing for income is a different strategy from growing a portfolio during the accumulation years with the best dividend stocks where you can take on some more risks.

As such, finding the appropriate stock that gives you the best income with the best dividend stability is no small task. The stocks you want are:

Safe and stable business models
Provides 4% dividend yield
Has a history of consistent dividend payments
Has some dividend growth to keep up with inflation

The stable industries are the telecom stocks, the utility stocks, the bank stocks and the insurance stocks. They have the tollbooth business concepts which implies recurring revenue.

Best Dividend Income Stocks

The Dividend Snapshot Screener is set up to quickly narrow down a short list. Filter by the income fit, the yield, the Chowder score and any other metrics you want.

Each of the holdings below will pay you more than 4% and grow their dividends at a faster rate than the inflation so you can keep up with inflation.

As a note, REITs are excluded from the filter. I am not a fan and there are safer options to generate income and have dividend growth keeping up with inflation.

The 3 filters I use from the best Canadian stock screener are:

Dividend Yield over 4% – Good income and not at risk
Chowder Score over 10% – Dividend growth beating inflation
Minimum of 5 Annual Consecutive Dividend Increases – Consistency by management

From a dividend income perspective, the telecom stocks are a good investment as they often provide the highest dividend income but not always with the best dividend growth.

Note that screening stocks for income requires unique dividend data. Not many screeners focus on dividend data. You should consider a screener such as Dividend Snapshot Screeners.