If you’re looking for a long-term, recession-resistant investment that can help protect your retirement savings in good times and bad, look no further than what comes out of your kitchen faucet. That’s right—water is becoming one of the most valuable and investable resources in the world.
In the coming decades, clean, reliable water access will be as important—and as scarce—as energy. Global population growth, aging infrastructure, climate change, and growing demand from agriculture and industry are turning water into a high-stakes issue. But for retirees and cautious investors, this challenge presents a rare opportunity: investing in water could help you build a resilient portfolio while supporting the future of our planet.
Let’s dive into why water is the new gold, and how you can stake your claim with smart, long-term investments in water utilities, infrastructure, and ETFs.
Why Water is Becoming a Scarce—and Valuable—Resource
It may seem strange to think of water as scarce. After all, more than 70% of Earth is covered in it. But less than 1% of the water on Earth is actually usable and accessible for drinking, farming, and industry. And that sliver of fresh water is under growing pressure.
Here’s what’s driving global water scarcity:
Climate change is causing longer droughts, more extreme weather, and water shortages in places that once had steady supplies.
Population growth means more people need more water for drinking, hygiene, and food production.
Aging infrastructure in developed countries (like the U.S.) leads to billions of gallons lost daily through leaking pipes and outdated treatment systems.
Industrial and agricultural use continues to skyrocket, with farms and factories using the lion’s share of freshwater.
Water isn’t just a basic need. It’s also big business. Governments, cities, and companies will need to invest trillions of dollars in the coming decades to upgrade water systems, build more efficient treatment facilities, expand access, and prevent waste.
That means smart investors have a golden opportunity: investing in water infrastructure and utilities today could lead to strong, steady, inflation-resistant returns tomorrow.
Why Water Stocks Belong in a Retirement Portfolio
Water investments are more than just ethical or green—they’re practical, especially for retirees seeking stability and income. Here’s why:
Essential services: Water utilities provide an absolutely essential service, no matter what the economy is doing. That makes their cash flows reliable and recession-resistant.
Built-in demand: Unlike luxury goods or cyclical industries, people will always need water. Demand isn’t optional.
Government support: Infrastructure spending—including water systems—is often backed by public funding, providing an extra layer of security.
Dividends and defensive value: Water utilities tend to pay consistent dividends, which is music to the ears of income-focused investors. They also behave more like defensive stocks—less volatile and more stable during market downturns.
If you’re looking to reduce risk and generate reliable income in retirement, adding a few water stocks or ETFs to your portfolio can help provide peace of mind—and potentially outpace inflation, too.
The Top 6 Water Utility Stocks for Long-Term Investors
Here are six standout water utilities and water-focused infrastructure companies with strong reputations, solid balance sheets, and long histories of dividend payments.
American Water Works (AWK)
The largest publicly traded water utility in the U.S., serving over 14 million people in 24 states. AWK is a dividend grower and a favorite among defensive investors.
Essential Utilities (WTRG)
This company provides water, wastewater, and natural gas services to more than 5 million people across 10 states. Known for its conservative management and consistent dividend payments.
California Water Service Group (CWT)
One of the oldest and most respected water utilities, serving communities in California, Washington, and Hawaii.
York Water Company (YORW)
The oldest investor-owned utility in the U.S., with a track record of paying dividends since 1816—yes, over 200 years! A small-cap gem with steady performance.
Middlesex Water Company (MSEX)
Operates in New Jersey and Delaware and has been paying dividends for over a century. This company focuses on reliable service and long-term growth.
Veolia Environnement (VEOEY)
Based in France, Veolia is a global leader in water treatment, waste management, and energy services. It gives you international exposure to large-scale infrastructure solutions.
These companies may not grab headlines like tech stocks, but they deliver steady returns, low volatility, and strong dividend growth—just what many retirees are looking for.
Want Easy Diversification? Try These 4 Water ETFs
If you don’t want to pick individual water stocks, there’s good news: several exchange-traded funds (ETFs) provide instant diversification across dozens of water-related companies. Here are four highly rated water ETFs that belong on your watchlist:
Invesco Water Resources ETF (PHO)
The most popular water ETF, PHO tracks U.S. companies that create products to conserve and purify water. It includes both utilities and technology firms focused on innovation.
First Trust Water ETF (FIW)
Another well-diversified option, FIW includes companies involved in water distribution, infrastructure, treatment, and equipment. It has a strong long-term performance record.
Invesco Global Water ETF (PIO)
For a more international approach, PIO invests in water companies around the globe. Great for investors looking to diversify beyond the U.S.
Ecofin Global Water ESG Fund (EBLU)
A socially responsible ETF focused on companies with strong ESG (environmental, social, governance) ratings. It blends utilities with infrastructure and technology innovators.
These ETFs provide broad exposure to the growing water sector, without the need to research and monitor individual stocks. They’re ideal for retirement portfolios that value simplicity, safety, and long-term growth.
Real-Life Example: A Retiree’s Smart Water Investment
Meet Linda, a 67-year-old retiree in Arizona. Concerned about climate change and inflation, she wanted to move part of her retirement savings into something that felt both safe and forward-looking. She chose to invest $50,000 in a mix of water-focused assets:
$20,000 in PHO for ETF diversification
$10,000 in AWK for reliable dividends
$10,000 in WTRG for water and natural gas exposure
$10,000 in MSEX for long-term dividend growth
Over the next five years, her water investments grew steadily and paid regular dividends. More importantly, they helped her sleep at night, knowing she was invested in something essential, sustainable, and secure. While the broader market bounced up and down, her water portfolio remained calm and steady—like a deep, still reservoir.
Final Thoughts: Secure Your Future with Liquid Gold
Water may not make flashy headlines, but that’s exactly why it’s a smart investment for the long haul. As the world’s population grows and climate pressures mount, water will become even more critical—and valuable.
Adding water utilities, infrastructure companies, or ETFs to your retirement portfolio can give you:
Reliable income
Low volatility
Defensive strength
Environmental impact
Peace of mind
In today’s uncertain world, that’s worth its weight in gold.
This post is an excerpt from my book: Liquid Gold: Investing for a Thirsty Future—available now at Amazon.com in eBook or paperback format. Whether you’re a cautious retiree or a long-term investor looking for stability, this book will show you how to turn the global water crisis into an investment opportunity that lasts a lifetime.
Disclaimer: For Educational Purposes Only
The content on this website is intended for general educational use and should not be considered personalized financial, legal, or tax advice. Always consult a qualified professional before making financial decisions. All investments carry risk, and past performance is not a guarantee of future results. The author assumes no liability for actions taken based on this content.