Dividend-paying stocks are hard to beat for income. If you're retired, you can use that money for your living expenses, and if you're still far from retirement, you might simply reinvest those dividends into more shares of stock -- perhaps shares that will start kicking out dividend income of their own. Dividends are a beautiful thing.

Let's say that you're looking to collect around $1,000 per year in dividends, and you're interested in investing in telecom giant AT&T (T). How many shares do you need to buy? A little simple math will get you the answer.

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AT&T was recently trading for around $27.30 per share, and it was paying out $1.11 annually in dividends per share -- in quarterly installments of $0.2775. (Most dividend payers pay quarterly.) AT&T's dividend yield -- the annual dividend sum divided by the recent share price -- was a solid 4.1%, meaning that if you bought that day, you'd receive about 4% of your purchase price in dividends each year. (Note, too, that healthy and growing dividend payers tend to hike their payouts over time, though AT&T actually shrank its dividend in 2022.)

To find out how many shares you'll need to own to collect $1,000 over the course of a year, simply divide $1,000 by that $1.11, and you'll arrive at the answer: 901. At the recent share price of $27.30, those 901 shares will cost you about $24,600.

Before you rush to buy into AT&T for its dividend, make sure you've read up on the company and are confident that it will do well. Its last earnings report, for its fourth quarter and 2024, was solid, with revenue and subscribers both increasing. The company plans to spend around $40 billion on dividends and stock buybacks in the coming three years, and a dividend increase is a possibility, too.