Dividend Cuts are adding to Retirees Pain

Dividend investing has been big in the last several years and it was looking like it was going to be another great year.  Well, I think we all know what changed this – yes, the Coronavirus.   U.S. Gross Domestic Product fell at a 5% rate in the second quarter and could go down as much as 39.5% according to the Atlanta Federal Reserve.  With that being said, companies cut dividends by $5.5 Billion in the first quarter of the year.  In the second quarter, dividends were cut by $42.5 Billion.  Most companies made this move to preserve cash and we do feel when the pandemic is over that dividends will be back on the way up.  However, this could be a 3-5 year period before we get back to the levels that we were at pre Coronavirus.