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2 Dividend Stocks You Can Buy & Hold Forever

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Dividend stocks are ideal for a wide range of investors. Retirees can use the income to meet daily expenses. Younger savers can use the payments to buy even more stock.

No matter your situation, the best approach is to stick with a long-term strategy. This allows you to capture the most powerful force in finance: compound interest.

Compound interest allows your money to grow faster the longer it’s invested. Your gains can be exponential; you just need to remain patient.

There are two dividend stocks in particular that are perfect for a long-term strategy. These stocks won’t just double or triple your money. Over time, you can accrue gains of 1,000% or more.

Bet on babies

Brookfield Infrastructure (TSX:BIP.UN)(NYSE:BIP) is a direct bet on population growth. That’s like shooting fish in a barrel.

For centuries, global populations have risen with unrelenting consistency. The United Nations thinks populations will continue to rise until at least 2100. If you bet on this rise, you can maintain your bet for another 80 years.

How does Brookfield Infrastructure capitalize on population growth? It owns assets like bridges, pipelines, and cell towers: all things that experience higher demand as populations rise. These assets also produce regular cash flow, meaning dividends are remarkably consistent.

Right now, Brookfield Infrastructure stock delivers a 3.1% dividend yield. That may not seem incredible until you realize that the stock price has also doubled in value over the last five years. This is a rare opportunity to get the best of both worlds: income and capital gains.

Because the global baby boom will continue for decades, you don’t have to worry about Brookfield Infrastructure stock going out of fashion. All it needs to do it rinse and repeat its proven strategy. That means acquiring more critical infrastructure assets and turning them into long-term cash flow machines.

Green energy dividends

Brookfield Renewable (TSX:BEP.UN)(NYSE:BEP) is a sister company to Brookfield Infrastructure. It has a similar strategy in that it’s targeting a multi-decade growth opportunity capable of delivering massive dividends to shareholders. But instead of capitalizing on population growth, this company is benefiting from the global transition to renewable energy.

From 2015 to 2020, roughly $5 trillion was invested worldwide in renewable energy projects. This is truly a massive market, yet things will get even more exciting. Over the next five years, investment should double to $10 trillion. Brookfield Renewable is in a prime position to profit.

Brookfield Renewable is already one of the largest renewable energy companies on the planet. The sun or wind may vary day to day, but over a longer period, production is very predictable. This is what makes the company a cash flow machine. It has predictable cash flows with near-zero costs of production. That cash flow supports a growing 3.9% dividend.

As with Brookfield Infrastructure, the yield isn’t anything crazy, but it should have a multi-decade runway for growth. Brookfield Renewable stock has also generated heavy capital gains. Since 2000, shares have risen six-fold.

Given the recent market pullback, many dividend stocks are perfect buys right now.

The list below has our TOP dividend stock picks.

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The Motley Fool recommends BROOKFIELD INFRA PARTNERS LP UNITS and Brookfield Infrastructure Partners. Fool contributor Ryan Vanzo has no position in any stocks mentioned.

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