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Being frugal has been a growing trend and for good reason. Whether it be out of necessity, fear or wisdom we have certainly seen a shift into spending less in America. This trend is likely to continue for the foreseeable future.

High unemployment and poor economic growth means we can expect the frugal movement to last. Each day that it does continue we not only extend the trend but we reinforce the need to be frugal. That idea is likely to stick for a long time, providing sustained returns for stocks that cater to frugal consumers.

There are a lot of dividend stocks that sell products that appeal to frugal consumers. We’ve highlighted a few that have been raising their dividends for 5 years or more.

McDonald's – (NYSE:MCD)

I’m loving it, and if you own MCD you have been too. McDonald’s has seen huge growth as consumers shift away from restaurants and into low-cost fast food stores. McDonald's has a 3-year net income growth rate over 27%. The growth shows no sign of slowing. Sales were up 5.2% in the US, 4.8% in Europe and over 6% in Asia/Pac Mideast/Africa for October.

McDonald's has raised the dividend every year for the last 34 years and currently has a 5-year dividend growth rate of 27.5% (Morningstar). MCD is paying an annual dividend of $2.80 giving it a dividend yield of 3%. McDonald's has consistently ranked well on our high-yield stocks list.

Family Dollar – (NYSE:FDO)

Family dollar is a discount retailer with more than 9000 stores in 35 states. It specializes in consumables, home products and apparel. FDO is one of the highest rated stocks on our safe-dividend list.

Family dollar has a small dividend yield of just 1.2%, which is off its 5-year average of 1.6%. The 5-year dividend growth rate is just over 11% and it has raised the dividend for 34 consecutive years. FDO has a P/E ratio of 18, which is lower than rival dollar stores. It is the only dollar store I’ve found that is paying a dividend to shareholders. FDO is up 27% year to date.

Target – (NYSE:TGT)

Target and its cheap chic retail shop have attracted consumers with its stylish goods and low prices. It has partnered with multiple well known designers to help create affordable products that rock. Target only started to expand outside of the US in 2011 so the international story has just begun.

TGT is a dividend aristocrat, increasing its dividend each year for the last 39 years. It has a dividend yield of 2.3% and a 5-year dividend growth rate over 20%. The payout ratio remains a modest 25%.

Wal-Mart – (NYSE:WMT)

Wal-Mart is another dividend aristocrat that serves in the discount retail space. It has raised the dividend for 35 years straight and has a 5-year dividend growth rate of almost 17%.

Currently Wal-Mart is yielding 2.4% and has a payout ratio of 31%. WMT has a P/E ratio of 13.1 compared with Target’s P/E ratio of 12.3. Wal-Mart operates in 14 countries outside the US and has a market cap of 200B, about 6 times the size of Target.

Bob Evans – (NASDAQ:BOBE)

Bob Evans is one my favorite cheap places to go for breakfast. I’ve never been to a Mimi’s café but next time I’m in California, I’ll be on the lookout for one. In total it has more than 700 restaurants in the US. I also love to get its sausage from the grocery store when I just feel like cooking at home.

BOBE has a dividend yield of 2.5% and a 5-year dividend growth rate of 11.3%. It has raised the dividend for each of the last 5 years and has a payout ratio of 43%.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 5 Dividend Stocks That Thrive In A Frugal Economy