Other investment considerations
There are a number of other issues that you need to consider in relation to your investment strategy and these include:
- the impact of dividends on investment returns
- the impact of regular withdrawals from your portfolio
- the importance of rebalancing your portfolio
- the use of debt and investing.
Impact of dividends on overall investment returns
It is regularly stated that reinvested dividends make a big difference to overall equity investment returns over the medium to long term. This is well illustrated by Figure 10.1 that shows the FTSE All-Share Index with and without net dividends reinvested over the past 30 years.
I’ve heard some investment ‘experts’ suggest that high dividend-paying shares are better ...