I’m trying to understand the benefits of dividend stocks. I usually hear they generate “passive income” but from what I can tell, the dividend you receive is a tiny fraction of what you paid for the stock itself, and would take decades to recoup what you paid for the stock. Setting aside the possibility of stock price appreciation, how is receiving a small dividend better than keeping the lump sum you would have paid for the stock to begin with. What am I missing?
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>how is receiving a small dividend better than keeping the lump sum you would have paid for the stock to begin with. *What am I missing*
You get to do both.
When you own a dividend stock it’s just like a normal one. You can resell it whenever you want for whatever price you can get. You aren’t “recouping” anything with the dividend you are just making money.
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