Dividend income refers to the money that shareholders receive from a company's profits, typically distributed on a regular basis. Companies that generate sufficient earnings may choose to share a portion of these profits with their investors, rewarding them for their ownership stake. Dividends can be paid in cash or additional shares of stock. Investors often seek out dividend-paying stocks as a way to generate a steady income stream, especially during retirement. The amount of dividend income can vary based on the company's performance and its dividend policy, making it an important factor for those looking to build wealth over time.