How to Prepare for Retirement With These Top Canadian Dividend Stocks

Are you interested in preparing for retirement? Consider these top Canadian dividend stocks!

| More on:

Preparing for retirement can be a daunting task. However, you can get started today by investing in solid dividend stocks. If you continue to accumulate shares of outstanding dividend stocks, over time, your portfolio could be a great source of passive income. That, on its own, or in addition to other sources of income (e.g., pension), could help you retire very comfortably. In this article, I’ll discuss three top Canadian dividend stocks worth buying today.

This is one of the best dividend stocks in Canada

Fortis (TSX:FTS) is the first stock I think of when I think about Canadian dividend stocks. In my opinion, this is one of the best dividend stocks to hold over the long term. Fortis, if you don’t know, provides regulated gas and electric utilities. It serves more than three million customers in Canada, the United States, and the Caribbean. Fortis, and other utility companies, usually operate following a recurring revenue model. That allows them to take advantage of a very stable and steady revenue stream.

Fortis has turned that advantage into a 49-year dividend-growth streak. As of this writing, Fortis holds the second-longest active dividend-growth streak in Canada. The company has already announced its plans to continue growing its dividend at a rate of 4-6% through to at least 2027. Fortis also offers investors a forward dividend yield of 3.97%, giving you great bang for your buck.

Invest in one of the Big Five banks

The Canadian banks would be another great place to shop for dividend stocks. These companies, especially the ones at the top, tend to be flush with cash and have a long history of dividend distributions to back them up. Of the Big Five, Bank of Nova Scotia (TSX:BNS) stands as one of my favourite picks.

This company has been paying shareholders a dividend since July 1, 1833, and hasn’t missed a payment since. That represents 190 years of continued dividend payments. In addition, Bank of Nova Scotia currently offers investors a very attractive dividend yield of 6.63%. If you’re looking for a stock that could provide a reliable source of passive income while giving you great value, then Bank of Nova Scotia could be the pick for you.

Choose this top Canadian company

Finally, Canadians interested in preparing for retirement should consider buying shares of Canadian National Railway (TSX:CNR). This company operates a rail network that spans from British Columbia to Nova Scotia. Canadian National also operates in the United States as far south as Louisiana. All considered, Canadian National’s rail network totals nearly 33,000 kilometres of track.

Another outstanding dividend stock, Canadian National has been increasing its distribution since 1996. That means that the company is in its 27th year of dividend growth. Only 10 other TSX-listed stocks currently match or surpass that growth streak. Although Canadian National’s dividend yield is quite lower than the other two stocks mentioned in this article (2.06%), I believe the stock’s reliability is more than enough to make up for that.

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 Jed Lloren has positions in Bank Of Nova Scotia and Fortis. The Motley Fool recommends Bank Of Nova Scotia, Canadian National Railway, and Fortis. The Motley Fool has a disclosure policy.

More on Dividend Stocks

Confused person shrugging
Dividend Stocks

Passive Income: How Much Do You Need to Invest to Make $625 Per Month?

This retirement passive-income stock proves why investors need to always take into consideration not just dividends but returns as well.

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Dividend Stocks

Secure Your Future: 3 Safe Canadian Dividend Stocks to Anchor Your Portfolio Long Term

Here are three of the safest Canadian dividend stocks you can consider adding to your portfolio right now to secure…

Read more »

money goes up and down in balance
Dividend Stocks

Is Fiera Capital Stock a Buy for its 8.6% Dividend Yield?

Down almost 40% from all-time highs, Fiera Capital stock offers you a tasty dividend yield right now. Is the TSX…

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Dividend Stocks

How to Use Your TFSA to Double Your TFSA Contribution

If you're looking to double up that TFSA contribution, there is one dividend stock I would certainly look to in…

Read more »

woman looks at iPhone
Dividend Stocks

Retirees: Is TELUS Stock a Risky Buy?

TELUS stock has long been a strong dividend provider, but what should investors consider now after recent earnings?

Read more »

Concept of multiple streams of income
Dividend Stocks

Is goeasy Stock Still Worth Buying for Growth Potential?

goeasy offers a powerful combination of growth and dividend-based return potential, but it might be less promising for growth alone.

Read more »

A person looks at data on a screen
Dividend Stocks

How to Use Your TFSA to Earn $300 in Monthly Tax-Free Passive Income

If you want monthly passive income, look for a dividend stock that's going to have one solid long-term outlook like…

Read more »

View of high rise corporate buildings in the financial district of Toronto, Canada
Dividend Stocks

Passive Income Seekers: Invest $10,000 for $38 in Monthly Income

Want to get more monthly passive income? REITs are providing great value and attractive monthly distributions today.

Read more »