Who wants to be a millionaire retiree? Everybody, but you don’t have to scramble to achieve the objective. Joining the millionaire’s row is not a delusion if you invest in Capital Power (TSX:CPX), Slate Retail (SRT.UN), and Laurentian Bank (TSX:LB).
Investing in Capital Power during this holiday season is timely. You’ll be heading into 2020 with one of the most stable utility companies in your portfolio. The 128-year old company is a pillar in Canada’s electric utility industry.
With its upsized dividend of 5.77%, you can instantly boost your retirement savings. Apart from that, you’ll have the perfect supplement to your CPP retirement pension.
This Edmonton-based company once generated more than 50% of its energy from coal. However, with the growing plea to reduce the harmful effects of fossil fuels, Capital Power is focusing more on renewable energy. The company is currently operating 25 company-owned 25 power generation facilities.
The total power generating capacity of the facilities is 6,000 megawatts (MW). Similarly, after five years of moving into environmentally friendly energy sources, coal-generated power is down to 3%. Capital Power supports near-zero emissions from natural gas in power generation and broader industrial processes fully.
Hedge against inflation
Slate Retail is a $561.25 million real estate investment trust (REIT) that attracts plenty of income investors. When growing your nest egg, the high dividend is not the only consideration, however. You need a stock that can also serve as a hedge against inflation.
This REIT stock is sure protection because its tenants are grocery-anchored retail plazas, whose businesses will not suffer much during a financial crunch. People will continue to buy the essentials of everyday living. Further, the 8.65% dividend is over and beyond the 2% inflation rate forecast in 2020.
Slate’s tenants in the secondary cities of the U.S. remain profitable despite the proliferation of e-commerce stores or online retailers; the occupancy rate of its real estate portfolio is kept at a high of 95%.
Slate is disposing of its non-core assets as part of the streamlining strategy. A new period of growth will commence in 2020.
Small but dependable
While Laurentian Bank isn’t one of Canada’s Big Banks, it remains one of the favourite stocks of dividend investors. This $1.96 billion bank is both a Dividend Aristocrat and a dividend machine. The yield is an eye-catching 5.74%. Laurentian has a dividend growth streak of 11 years, with the payout ratio consistently below 65%.
Laurentian might be the seventh-largest banking institution, but it has captured a high market share in Quebec. Operations are also expanding due to the strategic acquisitions of specialty finance companies.
If your concern is the inadequacy of the CPP retirement pension, you can augment your retirement income with this bank stock. The bank is energetically working to improve business efficiency to make it more profitable in the years ahead. The price of $46.24 is relatively lower versus industry peers.
Prep your net worth in 2020
Combining the three stocks would have an average dividend yield of 6.72%. If you can allocate $70,000 to invest equally in each stock, you’ll have a cool million within a 25-year investment time frame. You’ll be a wealthy retiree in 2044.
The calculations presuppose that Capital Power, Slate Retail, and Laurentian can sustain or grow the current yields in the next two-and-half decades.
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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 Christopher Liew has no position in any of the stocks mentioned.