The last few months, and even the last few weeks, has been packed with all kinds of stock market volatility. The Dow Jones Industrial Index has been jumping above and below the key 10,000 level on what seems like a weekly basis. Overall, the trend of late has been downward, but powerful short-term rallies have been present as well. What should you do? As an individual investor I think it is unwise to try to time the market right now. Many participants have been burned when trying to time the market. I think a much wiser solution is to try to combat the stock market volatility with consistent dividend paying stocks.

As I have said before, you must always remember that not all dividends are created equally. Some stocks have an “attractive” dividend yield simply because they have lost so much market value in recent trading. These aren’t typically the stocks that you should be looking for when trying to find a safe haven. On the other hand, some stocks have a solid dividend, typically in the range of 3%-5%, and are also consistently growing that dividend. Often you’ll find that these are companies that have a great deal of cash on the balance sheet, and are diversified nicely in their business sectors.

The simple fact of knowing that you can receive a much higher rate of return from these dividend yields than you can from any bank money market or certificate of deposit is very encouraging. Additionally, these stocks that have a history of hiking their dividend payout in all economic environment’s are much more likely to hold up than a speculative stock.

Use the current stock market volatility to learn an important lesson in the power of consistent dividend paying stocks. These are the stocks that will help you get through the tough market and build up a nice savings in the long run.

I have always found high dividend yielding stocks to be attractive as long as the company has the balance sheet and cash flow to support that dividend, but this week’s Federal Reserve decision makes them more attractive than ever. Why is this the case? Let’s look at the alternatives you have right now. Certificates of Deposit as well as Money Market Savings Accounts are both going to be yielding extremely low amounts in the coming months as the prime rate will be so low that banks simply cannot afford to offer an attractive yield. Treasury bonds are as safe as can be, but they have recently been trading at around 0, which obviously is simply a safety trade and won’t net you any money.

Which high dividend yielding stocks should you avoid? Avoid high dividend yielding stocks that are yielding such a high amount primarily because their stock price has fallen so drastically. Also, avoid dividend paying stocks that are losing money and/or trying find ways to raise new capital for their operations. If a company is needing to raise money to stay in existence do you really think their dividend is safe?

Companies with a solid balance sheet and strong free cash flow are your best friend when it comes to high dividend yields. I also find consistency to be a tremendous key to showing the strength of their business. There are some companies who have raised their dividend payouts consistently for over 40 years straight. These are the types of companies that should help investors in the long run.

A high dividend yielding stock isn’t necessarily immune to the markets volatility, but it does have a nice cushion to it because of the safety net of the cash on hand and the dividend payout. The bottom line here is that the best dividend paying stocks are going to be a very valuable asset that earns more than any savings account or certificate of deposit will, and if the company is solid through economic pressures you also have the opportunity for price appreciation. Consider high dividend yielding stocks in lieu of other investments that are less attractive with interest rates at zero.