Got $1,000? Buy These 2 Stocks and Hold Until Retirement

If you have time to wait, then an investment of just $1,000 could turn into an enormous portfolio with these TSX stocks by the time you hit retirement.

| More on:
Path to retirement

Image source: Getty Images

I’m going to make things really simple for those reading this article today. Instead of giving you potential scenarios, I’m going to use my own scenario to give you insight into what TSX stocks you should hold into retirement.

My hope is that I can show you that by investing $1,000, you can see how much growth you can reach by the time you retire. I’m currently in my 30s. So, if you’re 30, then retirement may not be until you’re 65. That’s 35 years of growth to look forward to.

In this case, $1,000 can certainly get you far. But these are the TSX stocks to get you the farthest.

CIBC stock

One of the best buys I’ve made in the last few years is Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM). CIBC stock is a Big Six bank, providing me with the largest dividend yield of the batch. Plus, it’s super cheap in more ways than one.

CIBC stock currently trades at just 9.22 times earnings. It has a dividend yield that’s at 5.23%, and another benefit is the recent stock split that puts it at the low end among the other Big Six banks.

What’s more, that dividend has been rising again and again in recent years. In the last decade alone, CIBC stock boasted a compound annual growth rate (CAGR) of 6.31% to look forward to. And that’s been even higher in recent years. It’s one I’ll continue to buy and where I’d put $1,000 right now.

Brookfield Renewable stock

Another of the TSX stocks I’ve been happy to own is Brookfield Renewable Partners (TSX:BEP.UN)(NYSE:BEP). I love Brookfield stock for a number of reasons right now. First off, it’s been performing well in this year alone. But long term, shares are growing higher and higher, and I expect more of that during this transition to clean energy.

But what I love about Brookfield stock right now is the dividend. It currently provides me with a 3.42% dividend yield that’s grown at a CAGR of 8.84% during the last decade. And I expect more growth like this, as people around the world buy renewable energy-producing companies like this one.

Invest that $1,000

Let’s say you’re that 30-year-old who has $1,000 to put towards both of these TSX stocks. We’re going to consider the CAGRs for both the dividend and also the stock price itself. In the case of CIBC stock and Brookfield stock, these come to 10.4% and 16.4%, respectively, over the last two decades.

So, if you were to buy $1,000 in each, you could potentially see these TSX stocks grow by that amount during the next 35 years as well. Also, you could take your dividends and reinvest them back into your share price.

In this case, the $1,000 investment in each of these TSX stocks could come to $77,963 in your portfolio and about $1,093 in dividends each year for CIBC stock. For Brookfield stock, you could have a portfolio worth $290,647 and annual dividends of $924. That’s a combined total of $368,610 from a $2,000 investment.

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 Amy Legate-Wolfe has positions in Brookfield Renewable Partners and CANADIAN IMPERIAL BANK OF COMMERCE. The Motley Fool has no position in any of the stocks mentioned.

More on Dividend Stocks

A worker uses a double monitor computer screen in an office.
Dividend Stocks

TFSA Investors: 2 Winning Buy-and-Hold Forever Stocks in April 2024

Buy-and-hold stocks are easy enough to find if you limit yourself to dividends, but there are at least a few…

Read more »

worry concern
Dividend Stocks

Telus Stock Is Down to its Pandemic Low of Below $22: How Low Can it Go?

Telus stock is down 37% in two years and is trading near its pandemic low, making investors wonder how low…

Read more »

money cash dividends
Dividend Stocks

Portfolio Payday: 3 TSX Dividend Stocks That Pay Monthly

After adding these three TSX dividend stocks to your portfolio, you can expect to receive attractive monthly income for years…

Read more »

Dividend Stocks

The Top Canadian REITs to Buy in April 2024

REITs with modest amounts of debt, like Killam Apartment REIT (TSX:KMP.UN), can be good investments.

Read more »

Technology
Dividend Stocks

The Smartest Dividend Stocks to Buy With $500 Right Now

Some of the smartest buys investors can make with $500 today are stocks that have upside potential and pay you…

Read more »

Various Canadian dollars in gray pants pocket
Dividend Stocks

2 Dividend Stocks to Buy in April for Safe Passive Income

These TSX Dividend stocks offer more than 5% yield and are reliable bets to generate worry-free passive income.

Read more »

protect, safe, trust
Dividend Stocks

How to Build a Bulletproof Monthly Passive-Income Portfolio With Just $1,000

If you've only got $1,000 on hand, that's fine! Here is how to make a top-notch, passive-income portfolio that could…

Read more »

Senior Couple Walking With Pet Bulldog In Countryside
Dividend Stocks

CPP Insights: The Average Benefit at Age 60 in 2024

The average CPP benefit at age 60 in average is low, but claiming early has many advantages with the right…

Read more »