Will the current popularity of The Monthly Dividend Company continue? Investing preferences often change so it is difficult to predict what will be popular in the short term. While there is no guarantee as to how our shares will be valued in the future, there are certain demographic and economic trends that may bode well for income stocks such as ours over the long term.

During 2001 the largest generation of nest builders and featherers—the Baby Boomer generation—started counting their market losses from the prior year-and-a-half and suddenly realized that the first objective of investing is not to lose what you already have. This revelation was particularly significant to this group of people since their retirement years are now much closer and perhaps less promising than just a couple of years ago. This is especially true for those who were born at the beginning of the post-war baby boom and are approaching their 60’s.

In addition to the potential increase in demand for income by retiring baby boomers, as of 2001, one out of every 12 Americans had already reached the traditional retirement age of 65. By 2030, that number is expected to grow to one in four! Over the next 20 years, it is anticipated that the retirement age population will grow by 3.4%, or by 1.2 million people, every year. We believe the demand for retirement income is sure to increase in conjunction with this major demographic shift in our society.

How prepared is the next generation of retirees to fund their retirement? Recent studies indicate that Baby Boomers are saving only 30% of what they will need to maintain their current lifestyles through their retirement years. In fact, they may need to work well past the traditional retirement age in order to support themselves. With the prospects for future Social Security income under scrutiny, it is likely that upwards of 75% in supplemental income may be required to support the next generation of retirees.