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You’re not alone if the stock market ups and downs of 2020 have left you feeling mostly down.

Stocks have roared back from the depths of March, but some investors haven’t yet bounced back from the trauma of the market decline. Their feelings of uncertainty were captured in a recent e-mail from a reader who is retiring in her mid-60s along with her partner. They’ve sold some properties and have a high six-figure amount of money to invest.

“Our goal was to generate passive dividend income and enjoy our life,” she wrote. “Is this still wise? We are fearful of losing everything we’ve worked so hard for.”

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The wisdom of this couple relying on a huge investment in dividend stocks to generate retirement income is best assessed by a financial planner who can examine their other sources of income, their spending needs, their resources to weather financial emergencies and their tax situation. But, in general, dividend investing is as wise as ever if you go into it realistically. A few points to guide your thinking:

Dividend stocks can be volatile

The price of dividend-paying stocks can bounce around a lot, as we’ve seen this year. Bank stocks are well off their 52-week highs, for example. Generating passive dividend income means a focus on cash dividends paid quarterly and not on share price. But some investors are going to see big share price declines in disastrous terms, even as their dividends keep flowing. Hence this reader’s comment about losing everything she and her partner worked for.

Dividends can be cut or suspended

Suncor Energy Inc., Reitmans (Canada) Ltd., Mullen Group Ltd., Inter Pipeline Ltd., Gildan Activewear Inc. and CAE Inc. are but a few examples of companies that have cut or suspended dividends since the start of the pandemic. If you’re relying on dividend income, you’ll want to diversify your holdings and go lightly, if at all, on cyclical stocks that do best when the economy is strong. A focus on dividend growth stocks also makes sense. A company has to be well run to build a history of steady dividend increases. Pay close attention to how a company managed dividends during and after the 2008-09 recession as well as in 2020.

Dividend-paying blue chip stocks will survive the pandemic

Countries around the world proved during the spring and summer that they could contain COVID-19 well enough for the economy to stabilize. We will get the pandemic second wave under control as well.

Dividend stocks offer compensation for all the risks mentioned here

The yield on the S&P/TSX Canadian Dividend Aristocrats Index is around 4.5 per cent, while a five-year Government of Canada bond yield has been stuck around 0.4 per cent since May.

The wisdom of dividend investing is as compelling as it ever was, but not everyone is cut out to live off income from a stock portfolio subject to violent market moves.

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