Statistics Canada reports that the average age of retirees in 2022 was 64.6 years. Still, many Canadians in mainstream employment dream of quitting their jobs earlier to have more years to enjoy retirement. However, income following retirement is usually the primary consideration, barring health issues.
If you start early, sustained saving and dividend investing can help accelerate retirement plans and build ample retirement funds before the Canada Pension Plan (CPP) and Old Age Security (OAS) become available at 60 and 65. An investment horizon of 25 to 30 years should give you enough time to build retirement wealth from three outstanding dividend stocks.
Strong buy
CT REIT (TSX: CRT.UN) is a strong buy for its resilient fundamentals, growing dividends, and having Canadian Tire (TSX: CTC.A) as a controlling unitholder and anchor tenant. The $3.65 billion real estate investment trust (REIT) owns over 370 income-producing commercial properties across Canada.
In Q1 2023, property revenue and net operating income (NOI) increased 4.2% and 4.5% year over year to $137.5 million and $107.4 million. Notably, same-store NOI increased due to higher revenues from contractual rent escalations. Apart from the strong results, CT’s president and chief executive officer (CEO) Kevin Salsberg said the REIT has the ability to increase shareholder returns.
The most recent dividend hike of 3.5% marks a 38.2% cumulative increase since the initial public offering in 2013 and 10 consecutive years of dividend increases. CT REIT’s occupancy rate is 99.2%. At $15.55 per share (+1.55% year to date), the dividend offer is 5.58%.
Defensive asset
Emera (TSX: EMA) is a no-brainer buy for risk-averse investors and future retirees. The low-risk profile of this utility stock makes it a defensive holding. This $15.99 billion multinational energy holding company has nine operating companies (Canada and the U.S.), with seven regulated electric and natural gas utilities.
Like CT REIT, Emera is a Dividend Aristocrat owing a dividend-growth streak of 16 years. In Q1 2023, net income rose 33% to $378 million versus Q1 2022. But the best part about taking a position today is management’s dividend-growth guidance of 4-5% through 2024. The current share price is $58.95 (+16,76% year to date), while the dividend yield is 4.68%.
Critical infrastructure network
Brookfield Infrastructure Partners (TSX: BIP.UN) offers risk-adjusted total returns and targets sustainable, long-term distributions of 5-9% annually. The $21.9 billion global infrastructure company facilitates the movement and storage of energy, water, freight, passengers and data. As of this writing, the stock is up 14.66% year to date ($47.55 per share) and pays a 4.29% dividend.
The diversified portfolio with four operating segments (utilities, midstream, transport, and data) generates stable and predictable contracted cashflows. According to its CEO Sam Pollock, the high-quality infrastructure assets are well positioned to deliver resilient results during all market conditions.
Brookfield Infrastructure is ideal for long-term investors seeking a pure-play global infrastructure vehicle. Pollock added that the company’s successful capital deployment initiatives ensure future growth.
Luxury of time
You can only stop working and live comfortably with enough financial resources to cover expenses, planned and unplanned. Thus, prudent spending, saving, and investing are activities of people looking forward to retirement. More importantly, you increase the chances of retiring earlier than usual if you have the luxury of time.
