2 TFSA and 2 RRSP Stocks to Keep Till Retirement

Some investors have a slightly different stock selection approach for their TFSA than their RRSPs. They may prefer conservative securities in the RRSP and fast growers in the TFSA.

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Not everyone has the same approach to their TFSA and RRSP portfolios. For some people, a TFSA portfolio might be a miniature version of the relatively larger RRSP portfolio. Others might only keep dividend stocks in the TFSA for passive income. Another viable approach is to place buy-and-forget types of stocks in the RRSP and relatively fast growers in the TFSA to boost the accessible funds you have.

TFSA stock #1

While it’s also an incredibly generous Dividend Aristocrat that has grown its payouts by 500% between 2017 and 2022, the primary reason to invest in goeasy (TSX:GSY) is its incredible capital-appreciation rate. However, its dividends cannot be disregarded, as it’s now also offering a relatively healthy 2.48% dividend yield.

As for the capital-appreciation potential of the company, its 10-year CAGR of 37.8% puts it among the most consistent yet powerful growth stocks in the country, which is a very select group. It’s important to note that a lot of this growth can be attributed to the post-pandemic bullish phase, but the stock has already self-corrected and is currently trading at a 32.4% discount from its peak.

So, even if you factor in the massive growth impact of the post-pandemic market into account, you will still be left with a lot of robust growth.

TFSA stock #2

Another strong growth contender, originally from the junior exchange, is StorageVault Canada (TSX:SVI). This company focuses on a very particular market segment: storage spaces, and it dominates this segment within several different Canadian communities. It’s also the largest owner and operator of storage facilities in Canada, with a portfolio spread out over 10.7 million sq. Ft. of land, containing 96,000 units.

The company has shown exceptional growth in the last decade and returned over 4,000% to its investors. And even if it grows at one-fourth of its former pace in the next decade, the company may grow its capital 10 times. This growth pace makes the incredibly expensive valuation relatively digestible.

RRSP stock #1

Slow, steady, and reliable securities are excellent fits for most RRSPs, especially if you wish to leave these securities in the account for decades. One such contender is Toronto-Dominion (TSX:TD)(NYSE:TD), the second-largest Canadian bank by market cap and one of the largest banks in North America. It has an impressive presence across the border and stable dividend history.

The performance of the stock in the last five years can be split between two very distinct parts. One is the pre-pandemic stagnation, and the other, the post-pandemic strong growth, which has shot the share price up 97% so far. And even though it has pushed the yield lower, it’s still a relatively decent number of 3.4%, though it would still be better to wait for the stock to dip to buy and lock in a better yield.

RRSP stock #2

If you want a different combination of growth and dividends (fast-paced growth and a lower yield), Canadian National Railway (TSX:CNR)(NYSE:CNI) might be more up your alley. The stock offers a 10-year CAGR of 17.1%, which may help you double your capital about every six or seven years (if it continues this pace).

The company is also a Dividend Aristocrat, and the current yield is about 1.85%. CNR is one of the largest Canadian companies by market cap and has a sizeable network of tracks across North America. Its positioning and the trust it has generated over a century of service make it stable, long-term security that is likely to perform well over the course of the next few decades.

Foolish takeaway

The two RRSP stocks will perform equally well in your TFSA, and your TFSA stocks can thrive and grow just as rapidly in your RRSP. It’s a matter of balancing your assets and leveraging growth differently between your retirement portfolio and the more accessible TFSA portfolio.  

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. The Motley Fool recommends Canadian National Railway.

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