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Create Your Own Pension Plan With These 3 Monthly Dividend Payers

Sometimes, I wish I could go back in time to the era when my grandparents were working.

Sure, it would be hard to give up all the luxuries of today, like my smartphone, the vast variety of food, and fast international travel, but I’d be gaining so much. The hustle and bustle of today’s world would fade away to a more calm and serene place. Neighbors would trust one another, rather than trying to one up each other.

But most of all, I’d take the gold-plated pension.

These days, less and less of us have the luxury of an employer-sponsored pension plan. As costs escalated out of control, many companies chose to discontinue offering the plans altogether, opting for a RRSP match instead. As the first wave of baby boomers starts to retire, we’re starting to see the consequences of the first generation largely responsible for their own retirement planning.

But it doesn’t have to be so hard. All retirees need to do is invest in high quality dividend stocks that pay them each month, and just sit back and collect dividend cheques. It really is that easy to create your own pension plan. Here are three stocks that fit the bill.

Shaw Communications Inc. 

Shaw Communications Inc. (TSX: SJR.B)(NYSE: SJR) provides phone, internet, and television services for 3.3 million Canadians, mostly in the west. It’s an incredibly consistent business.

Some customers are cutting the cable cord and using online services to watch their favorite shows, but at this point it’s barely noticeable. Most folks are addicted to their television and internet connections to the point where Shaw can easily pass through price hikes above the rate of inflation.

These hikes fall straight to the bottom line, and to the company’s 4.04% dividend yield. Shaw has also rewarded investors by increasing the monthly payout from $0.07 per share in 2009 to $0.0916 today. Look for the company to continue increasing its dividend a little more than inflation, making it a great stock to hold for a retiree.

Cominar Real Estate Investment Trust

Every DIY pension plan needs a bit of a yield boost, which is why I continue to like Cominar Real Estate Investment Trust (TSX: CUF.UN) and its 7.75% yield.

Investors are a little concerned about the company’s overexposure to Quebec and its weak real estate market, but I believe concerns are overblown. Recent results have been great, and the company just announced a distribution hike while staying under its self-imposed 90% payout ratio limit.

The company just made a huge acquisition, paying $1.5 billion for 15 landmark properties from a division of Caisse de dépôt. The cap rate on these new shopping centers is an attractive 6.5%, and these properties are well within the company’s area of expertise.

Plus, management owns nearly 7% of all units, which is a huge number for a REIT the size of Cominar. I always like it when management is confident enough to hold a big position.

Crescent Point Energy Corp.

Rounding out the list is perhaps Canada’s most aggressive energy company, Crescent Point Energy Corp (TSX: CPG)(NYSE: CPG).

Since 2010, the company has increased the number of shares outstanding by 50% and its long-term debt load by more than $1.5 billion, virtually all because of acquisitions. Yet its still managed to keep its $0.23 per share monthly dividend intact.

The company has become a powerhouse producer. It has operations across western Canada, North Dakota, and Utah, with the majority of its production in Saskatchewan. It enjoys some of the highest netbacks in the industry, and management obviously has the golden touch for acquisitions. Production growth has been impressive as well, increasing more than 50% since 2012.

Plus, Crescent Point is a light oil producer. Not only does this let it operate without the scrutiny that plagues oil sands operators, but it also means it’s getting top dollar for its crude. Light oil is a great part of the market to be in, which should bode well for the company and the security of its generous dividend.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Nelson Smith has no position in any stocks mentioned. 


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