RRSP Investors: 3 Worry-Free, Blue-Chip Giants to Buy and Forget

The right retirement stocks can help investors develop a sizable nest in their RRSPs, given enough time and favourable market conditions.

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The Registered Retirement Savings Plan, or RRSP, has been around for decades and has been an important aspect of retirement planning for millions of Canadians. The registered account was designed to help Canadians grow their retirement savings in a tax-deferred environment. But growing a decent-sized nest egg requires more than a nourishing environment. It also requires the right investment assets.

A railway stock

If you are looking for powerful and relatively dependable growth, Canadian National Railway (TSX:CNR) is a strong candidate. It’s the largest railway company in Canada by market cap and operates an enormous railway network that connects several logistically important spots in North America (primarily the U.S. and Canada), including three major ports.

It’s a good investment for both capital-appreciation potential and dividends, although the first overshadows the other.

It has a stellar history when it comes to dividends and has been growing its payouts for 27 consecutive years, but its yield is typically at a modest level (2% at the time of writing this). The growth potential, however, is quite strong, especially for a company its size. It has grown by over 200% in the last decade alone.

An energy stock

Many energy stocks offer a good combination of dividend and growth potential, but Enbridge (TSX:ENB), the largest energy company in Canada and one of the largest pipeline/energy transportation companies in the world, is cherished by its investors for its dividends. It’s one of the most generous and resilient Dividend Aristocrats and has raised its payouts, even through some very weak markets.

It wouldn’t be fair to say that its capital-appreciation potential is non-existent, but it has been questionable at best since the 2014 slump. Even as a dividend stock, it can be a powerful addition to your RRSP portfolio, generating cash in the registered account that can be diverted to other investments.

Another option is to opt for the dividend-reinvestment plan (DRIP), which diverts its payouts back into the company (buying new shares), thus increasing the size of your stake in the company over time. The benefit is that when it’s time to start cashing in the dividends, you will have far more shares (assuming you hold it for several years) than what you started with and, consequently, a healthier passive income.

A bank stock

Toronto-Dominion (TSX:TD) is one of the most American Banks in Canada and among the largest banking institutions in North America. It shares the stability and resilience that are characteristic of the Canadian banking sector, thanks to conservative operations and relatively strict regulatory control.

It offers a good combination of long-term growth potential and dividends. The stock rose by about 94% in the last decade and is currently offering a healthy 4.4% yield. The dividends significantly augment its return potential, which rose to almost 187% in the last decade. It’s a stable, healthy investment that can be held for decades without worry.

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Foolish takeaway

The three blue-chip stocks represent giants and leaders in their respective industries. They are stable, offer decent return potential through dividends or capital growth (or both), and are resilient against weak market conditions. Hence, they have all the hallmarks of worry-free, buy-and-forget retirement stocks that can be held in your RRSP for decades.

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 Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends Canadian National Railway and Enbridge. The Motley Fool has a disclosure policy.

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