2 Stocks to Buy Now and Hold Until Retirement

Canadians saving for future financial security can buy two top TSX dividend stocks today and hold them until retirement.

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Retirement worries have risen since the coronavirus outbreak in March 2020. While COVID cases are dropping, the full impact of the pandemic is just emerging. As such, the anxiety levels of non-retired Canadians remain high to this day.

Future financial security is now top of mind, especially for those who are a few years away from retirement. If you have savings, time, and determination, it’s not too late to improve your situation. Many tools exist to put you on track to avoid economic dislocation in the sunset years.

Stock investing is the step most people take to grow their savings or build nest eggs. But why stocks? Historically, stocks have outperformed other asset classes and have delivered the highest returns. You can invest in companies that are time-tested income providers. Buy the dividend stocks now and hold them until retirement.

Dividend King

BCE (TSX:BCE)(NYSE:BCE) is a Dividend King. Canada’s largest telco commenced operations in 1880 and started paying dividends one year later. Thus, it’s not only Canada’s big banks that have dividend track records of more than 100 years.

The $57.22 billion telecommunications and media company hasn’t missed a single dividend payment. Its dividend increase over the last five years was at least 25%. With the emergent 5G technology, significant growth is on the horizon. Expect BCE to dominate.

Since BCE generates billions of dollars in revenue every year, would-be investors or retirees will have recurring income streams to fund their retirement lifestyles. In 2021, the telco stock is a stable performer (+22.02% year to date). At $63.63 per share, the perk is a fantastic 5.55% dividend.

BCE’s yield tops the offer of Telus (4.49%), Rogers Communications (3.44%), and Shaw Communications (3.34%). The total return in the last 45.85 years is 72,537.15% (15.45% CAGR).  

There’s a lot to look forward to with how BCE extends its services to businesses across Canada. Management announced recently the setting up a cloud-based IoT platform for fleet and supply chain operators. Bell IoT Smart Connect aims to reduce business complexity in supply chains and enable better decision-making by organizations.

Decades-long income

Even if many consider utility stocks as boring investments, long-term investors can’t dismiss Canadian Utilities (TSX:CU). The $9.51 billion company derive substantial revenues from regulated assets. Also, it holds the distinction of owning the longest continuous record of dividend growth. No dividend-paying company in Canada matches the 48 years dividend-growth streak of CU.

The next closest, Fortis (47 years), belongs to the utility sector, too. CU’s competitive advantages are the multiple utility operations where cash flows and growth have been secure for decades. The electricity and gas distribution business in Alberta should endure. The company has the financial capacity to upgrade or replace aging assets.

Canadian Utilities isn’t a high flyer on the TSX, although the 17.97% year-to-date gain shows stability. The share price is $35.30, while the dividend yield is 5.08%. You’d have a recession-resistant stock in your dividend portfolio. Forget about the market noise and expect growing dividends well into your retirement years.

Reduce investment risks

Long-term investing is a proven strategy to meet retirement goals. It reduces investment risks and maximizes returns. The best part about BCE and CU is that your money compounds as you sleep soundly at night.     

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. The Motley Fool recommends FORTIS INC, ROGERS COMMUNICATIONS INC. CL B NV, and TELUS CORPORATION.

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