David Williams — who will be retiring at the end of 2012 after 37 years as a mutual fund manager, including the last 18 years at the helm of $6.4 billion Columbia Value & Restructuring — cautions fellow boomers not to get too conservative.
Instead, he recommends buying and holding blue-chip stocks that not only throw off income but can also deliver steady share price growth.
"We believe that higher quality companies will provide better risk-adjusted returns over full market cycles," adds Jason Lilly, co-manager of the Bright Rock Quality Large Cap Fund and a financial advisor catering to the generation entering their golden years.
High-quality stocks that can produce both growth and income play an important part in enabling boomers to maintain a comfortable lifestyle through what's likely to be a long retirement.
Stocks with staying power possess similar qualities — market leadership, shareholder-friendly management, strong balance sheets, consistent profitability and healthy cash flow.
With that in mind, here are 14 stocks to consider as core holdings for the future:
This play on the mobile Internet pays a handsome dividend of 5.4 percent. If the Apple iPhone expands its dominant position in the smartphone market, Verizon will be able to play up its network advantages over other carriers.
Doug Kreps, manager of the Fort Pitt Capital Total Return Fund, is also excited about the prospects for its FIOS multi-media service, which should increase bundled sales of phone, Internet and cable, and its FlexView video on demand service.
No bank survived the financial crisis better than JP Morgan. By picking up Bear Stearns and Washington Mutual on the cheap, the bank gained market share in both investment banking and retail banking.
Wall Street pros cite CEO Jamie Dimon’s astute management and the firm’s financial strength as reasons to hold the stock for the long haul. The stock currently yields 2.4 percent, and Mitchell Goldberg of Clientfirst Strategy in Woodbury, N.Y., expects JPM to grow its dividend the fastest among the biggest U.S. banks.
Pharmaceutical stocks should be a core holding of any investor looking for growth and income. While a handful of drug makers could have made our list, Switzerland’s Novartis stands out for its solid lineup of blockbusters (Lucentis for vision problems, cancer drugs Glivec and Tasigna, and newly approved Gilenya for multiple sclerosis) and what analysts consider one of the industry’s most promising pipelines. Standard & Poor’s recently raised its price target on the stock, which yields 3.3 percent, to $72.
A global aircraft duopoly with Airbus leaves Boeing well positioned to benefit from robust growth of passenger traffic in emerging markets like China and India. The aircraft maker estimates China alone will purchase 4,330 new planes over the next 20 years.