Look for dividend aristocrats

'Get paid to wait.' That is a phrase that is often associated with dividend-paying stocks. While there is continued uncertainty in the market place, getting a monthly or quarterly dividend to tide one over during the volatility is great; especially if you need regular income.

Dividends are declared by companies for shareholders as of a certain record date. Dividends, although very nice, are not guaranteed. They can be suspended at any time. However, well-run profitable companies do tend to raise their dividends consistently and regularly over time. Even during recessions. Look for these companies! There are lists that you can find that will let you know who the dividend aristocrats are. Another nice feature about dividends is that they are more tax efficient than interest income in a non-registered account- - meaning more in your pocket after-tax!

Maybe you don’t need the income? Want to add to a stock without commission costs? Consider dividend-paying stocks that have a Dividend Re-Investment Program - also known as the DRIP.

Here’s how it works:

The dividend is declared and paid into your brokerage account. The cash is taken and used to buy shares of the same company. And, voila, you now have more shares - - purchased without commission cost and in effect you are dollar cost averaging. Not a bad strategy.

Note: if it is done in a non-registered account, you are still going to have to report and pay taxes on the dividend income earned and received. And, take special care to keep track of your adjusted cost base for when you dispose of the stock.

Winnie Go is Portfolio Manager, Senior Wealth Advisor, ScotiaMcLeod. To learn more, click here.