3 Dividend Aristocrats To Buy and Hold for 30 Years

Dividend aristocrats can be a great source of reliable passive income as well as dependable long-term holdings. Some aristocrats can potentially be held for decades.

| More on:
tech and analysis

Image source: Getty Images

When you are planning your finances, it’s prudent to split them into two parts: short-term financial plans and long-term financial plans, especially when it comes to investments. Both would require you to invest in different assets.

For long-term holdings, Dividend Aristocrats are usually a safe bet, and even if you stick to this limited asset pool, you can have your pick of attractive yields and decent capital growth. But you’d also want to consider the long-term prospects of the company.

Three Dividend Aristocrats should be on your radar if you are looking for companies you can stick with for three decades.

A banking aristocrat

While it’s not counted among the original five titans of the banking industry, the National Bank of Canada (TSX:NA) might be just as safe a bet. In the last five years, its growth rate has been higher than the big five, and it also comes with a decent 3.94% yield. Its 10-year CAGR is 12.17% (dividend-adjusted), and if we take that as a benchmark, just $5,000 in this bank can grow up to $156,000 in three decades.

The bank has a decent national foot-print, but in the future, what would really count is the online banking front. Since it doesn’t have as many physical branches as the other banks do, National bank might find it easier to step into a digital future. If it can retain its current consumers and keep gaining new business at a steady pace, it might be able to continue its streak as an Aristocrat and hopefully keep growing at its current pace.

A green utility aristocrat

Algonquin (TSX:AQN)(NYSE:AQN) is a regulated utility and renewable energy company that focuses on hydroelectric, wind, natural gas, and solar energy for its energy generation. It has been growing its dividends for nine consecutive years, and since the energy and utility business is shifting to renewable quite swiftly, Algonquin is well positioned to keep growing (and increasing its dividends every year).

The current yield is 3.76%, which is adequate enough, but an even better reason to invest in the company is its growth potential. Its 10-year CAGR is a powerful 21.37%. While that might seem too good to be true, but if the company keeps growing at this rate, you can (theoretically) turn $5,000 into over a million dollars in 30 years.

A financial aristocrat

Another company that you might want to bet on long-term is goeasy (TSX:GSY). It’s an alternative lender that furnishes small personal loans. The company recently joined the ranks of the Dividend Aristocrats, but if its stock keeps going the way it’s going, it can serve as a powerful growth agent for your portfolio. It has a 10-year CAGR of 30.5%, which might be too good to last, but even half this rate would be enough for adequate growth.

It’s also quite generous with its dividend growth rate, so even if the yield is low right now (1.9%), a higher payout growth rate would be beneficial in the long-run.

Foolish takeaway

Identifying long-term investment assets alone isn’t enough. You also have to figure out where you want to place them. A good strategy would be to put steadily growing assets in your RRSP and rapidly growing holdings in the TFSA. This way, if you need to liquidate some of your assets, you’d have a decent amount accumulated handy and tax free.

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 Adam Othman has no position in any of the stocks mentioned.

More on Dividend Stocks

Various Canadian dollars in gray pants pocket
Dividend Stocks

Need Passive Income? Turn $5,000 Into $23.85 Every Month

If you're looking for passive income that comes in like a paycheque, this dividend stock provides that to you along…

Read more »

Silver coins fall into a piggy bank.
Dividend Stocks

A TFSA Contribution Room of $88,000 and 1 Dividend Aristocrat Can Make You $172,330 Richer

A high-yield Dividend Aristocrat in the energy sector is a suitable holding for Canadians with $88,000 available contribution rooms in…

Read more »

Dollar symbol and Canadian flag on keyboard
Dividend Stocks

2 Dividend Stocks to Buy Now Under $50

Here are two of the best under-$50 dividend stocks you can buy in Canada right now.

Read more »

TELECOM TOWERS
Dividend Stocks

If I Could Only Buy 1 Stock Before 2023, This Would be it!

If you could buy 1 stock before 2023, what would it be? Here’s the stock I’m considering, and I think…

Read more »

Beautiful holiday decorated background with christmas gift boxes ,fir. christmas holiday concept
Dividend Stocks

3 Dividend Stocks to Help Offset Holiday Spending

The holidays are here, and so is the seasonal spending. Offset some of those costs by putting your investment cash…

Read more »

edit Businessman using calculator next to laptop
Dividend Stocks

The 3 Passive-Income Stocks I’m Buying Next and Never Selling

These passive-income stocks have a proven track record of growth and a solid sector that will guarantee income for decades.

Read more »

oil and gas pipeline
Dividend Stocks

Enbridge Stock Rose More Than 4.5% in November: Is it a Buy Today?

Enbridge is having a good year. Are more gains on the way for the stock?

Read more »

worry concern
Dividend Stocks

3 Budget Mistakes Almost Everyone Makes

Leave these budget mistakes in 2022 and enter 2023 with more cash on hand and a better way of spending.

Read more »