Our calculations, when it comes to saving and retirement planning, vary greatly based on our lifestyle and income. For some, $5,000 may be their bimonthly savings, while others may save that amount in an entire year.
But regardless of what proportion of your available capital this amount represents, one of the best ways to grow it would be to buy the right stocks and hold on to them as long as possible, ideally till retirement.
A tech stock
CGI (TSX:GIB.A) is a business and IT consulting company that has been around since 1976. It’s among the largest companies in this domain, with 400 locations worldwide, and controls a network of over 90,000 consultants and professionals. It caters to various industries and has a decent service portfolio, including managed IT and infrastructure services.
This business model sets it apart from other tech companies that are vulnerable to radical advances in competitive domains. The company helps other businesses adopt new tech tools and manage their IT services better, and it’s likely to remain relevant for decades in the future. This stability has been one of the main factors behind the company’s success and its stock’s powerful growth over the last 15 years.
The stock has risen over 384% in the last decade, and if it continues to grow at this pace, you may grow your $2,500 in the capital (half of the available capital) to a decently sized nest egg in three or four decades.
The stock also stands out for its resilience against market or sector-wide slumps. During the correction of the tech sector, the stock barely dipped and is already trading at a 14.7% premium to its pre-pandemic peak. This, along with its business model, endorses its candidacy as a long-term holding.
A railway stock
Railways like Canadian National Railway (TSX:CNR) have been an important part of human civilization in the past two centuries. Even now, when much faster and more flexible transportation alternatives are available, railways play a crucial role in a country’s supply chain and heavy cargo hauling.
Canadian National Railway doesn’t just serve the local supply chain but also connects Canadian people and businesses to the U.S. as well.
The Canadian National Railway is among Canada’s most coveted blue-chip stocks for reasons beyond its economic importance and leadership position. It’s a powerful growth stock and a well-established Dividend Aristocrat, rewarding its investors on both fronts.
The company has grown its payouts for 27 consecutive years, making it a dependable Dividend Aristocrat, and it’s currently offering a yield of about 1.98%.
As for growth, the stock has risen by about 225% in the last 10 years. If you add dividends to the returns, the number jumps significantly higher (285%). You can boost your long-term growth potential with this stock by opting for the DRIP.
Foolish takeaway
The two stocks are among some of the best options you have on the TSX to park your $5,000 capital and hold it for decades. Both are leaders in their respective industries and have proved their resilience against weak markets, market crashes, and even recessions.
