3 Canadian Dividend Stocks That Belong in Every Retirement Portfolio

If you’re building a portfolio for retirement, these three Canadian dividend stocks are some of the best to buy today.

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Canadian Dividend stocks are some of the most important investments for retirement portfolios. Not only do retirees need more income coming in each month, but dividend stocks are also typically some of the safest and most resilient businesses, especially if you know which industries to invest in.

The best businesses to own are, of course, high-quality companies that are highly stable. These companies have robust operations and can earn a profit no matter what the situation with the economy. And most of the time, they are low-volatility stocks because they pay a significant dividend which is safe. And this is highly attractive, especially during recessions or bear markets.

So with that in mind, here are three of the best dividend stocks in Canada that belong in every retirement portfolio.

A top Canadian utility stock for retirement portfolios

Utility stocks are some of the best and safest stocks. This makes them excellent dividend stocks for a retirement portfolio. In Canada, there are plenty of high-quality utility stocks to consider. One company with attractive dividend yields is Emera (TSX:EMA), at 4.5%.

The company has utility operations in six countries, including Canada, the United States, and throughout the Caribbean. In total, Emera serves over 2.5 million customers showing just how big and diversified its business is.

What’s most attractive about utility stocks, though, in addition to how resilient they are, is that they are almost guaranteed to increase their dividends each year. This makes them ideal dividend growth stocks and helps ensure that investors are seeing growth in their passive income each year.

So if you’re looking for a high-quality Canadian dividend stock for a retirement portfolio, Emera is one of the best companies to buy today.

A top Canadian telecom stock

Another highly safe industry to find dividend stocks in is telecommunications. Stocks like Telus (TSX:T)(NYSE:TU) offer incredible resiliency even though they aren’t rate-regulated like utilities. Over the course of the pandemic, Telus’s revenue has continued to grow each quarter. Plus, it offers even more potential for long-term growth than a utility stock, both in the dividend and the share price.

Telus has been a top growth stock for years, and with 5G technology rolling out across the country, it has a huge runway for growth ahead of it.

Over the last five years, Telus has earned investors a total return of more than 63%, or a compound annual growth rate above 10%. Meanwhile, its dividend payments have increased by more than 30%.

So the income investors are seeing from their investment in Telus grew by more than 30% in just five years. Today, it yields roughly 4.5%. This is why Telus is such a top Canadian dividend stock and a perfect investment for retirement portfolios. It’s highly safe first and foremost but also offers a tonne of low-risk growth potential.

A top consumer staple stock

Last is a consumer staple stock, another company in an incredibly resilient industry. Many of the large consumer staple stocks don’t offer that much of a yield, though. However, North West Company (TSX:NWC) is an exception. Its stock currently yields roughly 4.4%.

Just like the other two stocks on the list, North West is highly resilient. And also, just like the other two, it’s a Dividend Aristocrat. So you know that North West is one of the best Canadian dividend stocks you can buy, especially for a retirement portfolio.

The company mainly operates grocery stores and supermarkets in remote communities in Northern Canada and Alaska. This is an extremely safe business for a few reasons. First, selling staples and essential items is a great business because it’s already naturally recession-proof. Plus, because it mostly operates in remote communities, the company faces little competition.

In recent years North West has been focusing on improving the efficiency of its operations, and its margins have improved considerably. So if you’re looking for a high-quality Canadian dividend stock to buy for a retirement portfolio, North West is an excellent stock to consider.

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 Daniel Da Costa owns shares of THE NORTH WEST COMPANY INC. The Motley Fool recommends EMERA INCORPORATED, TELUS CORPORATION, and THE NORTH WEST COMPANY INC.

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