Don't Gamble With Your Retirement: Invest in These Safe TFSA Stocks

Don’t Gamble With Your Retirement: Invest in These Safe TFSA Stocks

The TFSA is an ideal way to save for retirement. These three TSX stocks are ideal for those wanting stability and income.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published July 27, 2023 12:30 pm EDT

As you approach retirement, it’s important to start thinking about how you’re going to fund your golden years. One option is to invest in TSX stocks that are safe and have historically stable results. These stocks can provide you with a steady stream of income. They can also help you grow your wealth over time.

A Tax-Free Savings Account (TFSA) is a great way to invest for retirement. The money you contribute to a TFSA grows tax-free. Plus, you don’t have to pay any taxes on the income you earn from your investments.

This makes a TFSA a very attractive option for retirement investors, as it can help you grow your wealth over time without having to worry about paying taxes.Here are three TSX stocks that are worth considering for your retirement portfolio.

Extendicare

Extendicare (TSX: EXE) is a long-term care provider that operates over 700 facilities across Canada and the United States. The company’s stock has been on a tear in recent years, as the aging population has led to increased demand for its services.

Extendicare stock currently holds a price-to-sales (P/S) ratio of 0.56, which is considered quite valuable. The company also pays a dividend yield of 6.52%, providing investors with a solid amount of passive income in their retirement.

Overall, analysts are positive on Extendicare stock due to the aging population and company’s strong track record. The company also has a strong track record of profitability. In the past five years, Extendicare stock has generated average annual earnings per share growth of 10%. This profitability is supported by the company’s strong brand, diversified portfolio of facilities, and focus on operational efficiency. If you are looking for a long-term investment in the long-term care industry, Extendicare stock is a good option to consider.

BCE

BCE (TSX: BCE) is a telecommunications company that provides wireless, wireline, and media services to customers across Canada. The stock is currently trading below its historical average valuation, making it a good value investment.

BCE stock also pays a dividend yield of 6.7%, which is above the average for the index. The company has a long history of dividend growth, and its dividend is considered to be very safe. BCE stock is also trading below its historical price-to-earnings ratio (P/E), currently at 20.5 times earnings.

The wireless and internet markets are two of the fastest-growing sectors in the global economy, and BCE stock is well-positioned to benefit from this growth. The company is the largest wireless carrier in Canada, and it also has a leading position in the internet market.

Canadian Utilities

Canadian Utilities (TSX: CU) is another good option for retirement investors. And that’s especially true for investors who are looking for a growth opportunity in the renewable energy transition. These companies are well-positioned to benefit from the increasing demand for clean energy, as they have the infrastructure and expertise to generate and distribute renewable energy.

Over the past decade, Canadian Utilities stock has invested over $10 billion in renewable energy projects, including wind, solar, and hydroelectric power. These investments have helped the company to reduce its reliance on fossil fuels and become a leader in the renewable energy sector.

It’s also attractive from a valuation perspective. The P/E ratio of Canadian Utilities is currently 14.9, which is below its historic average. The P/S ratio is also below the average, at 2.3. It’s also well known as a Dividend King, with over 50 years of dividend increases, and a yield at 5.25%.

Bottom line

These are just a few of the TSX stocks that are worth considering for your retirement portfolio. When choosing stocks for your retirement, it’s important to focus on companies that have a long history of profitability and stability. You should also look for companies that pay attractive dividends, as this will help you generate income in retirement.

A TFSA is a great way to invest for retirement, as it allows you to grow your wealth tax-free. If you’re not sure where to start, you can speak to a financial advisor who can help you create a retirement portfolio that meets your individual needs.