Finding the right investments today can make a huge difference to your portfolio tomorrow. Fortunately, investors looking to build lasting wealth have plenty of options to choose from.
Here’s a look at three great options to build lasting wealth.
Source: Getty Images
Utility stocks are the ultimate autopilot investment
There’s no shortage of great stocks to build lasting wealth. One prime example of that is investing in utility stocks such as Canadian Utilities (TSX: CU).
Utility stocks are superb long-term options to build lasting wealth thanks to their stable, if not lucrative business models. In short, they generate a stable and recurring revenue stream thanks to regulated long-term contracts. This makes them some of the most defensive options to buy.
Additionally, that recurring revenue stream allows Canadian Utilities to invest in growth and pay out a very tasty dividend. As of the time of writing, that dividend works out to a 5.3% yield.
For a $30,000 investment (always as part of a larger, diversified portfolio) that works out to a tasty income of almost $1,600.
And that’s not even the best part.
Canadian Utilities is one of just two Dividend Kings in Canada. That means that the company has provided at least 50 consecutive years of increases to that dividend.
This not only makes Canadian Utilities one of the best options to build lasting wealth but also a great buy-and-forget option for any investor.
Become a landlord – without the mortgage
One of the tried and true ways to build lasting wealth has been to own a rental property. Unfortunately, rising home prices and interest rates have priced most would-be landlords out of the market.
That’s where the appeal of owning RioCan Real Estate (TSX: REI.UN) comes into play.
RioCan is one of the largest REITs in Canada, with a growing portfolio of mixed-use residential and commercial retail properties. Those properties provide a way for investors to generate a growing income to build lasting wealth.
And like a landlord collecting rent, RioCan provides a monthly distribution to investors. The key difference however is that investors in RioCan are exposed to less overall risk over owning a single property. The investment also doesn’t come with the hassle of a mortgage, securing a downpayment, or property taxes.
As of the time of writing, RioCan offers investors a 6.1% yield. This means that a $30,000 investment will generate $150 each month.
Prospective investors not ready to draw on that income yet can choose to build lasting wealth by reinvesting that income until needed.
Invest in this bank stock and enjoy the returns
One final option to consider buying now to build lasting wealth is Bank of Nova Scotia (TSX: BNS). Scotiabank is one of Canada’s big bank stocks, with a growing presence both domestically at home, and internationally. In fact, Scotiabank is often referred to as Canada’s most international bank.
Scotiabank, like its big bank peers, enjoys a solid hold on the domestic market in Canada. This helps the bank to generate a reliable revenue stream and pay out a handsome dividend.
As of the time of writing, that quarterly dividend pays out an impressive 5.3% yield. Using that same $30,000 investment from above will result in an annual income of just over $1,760. Adding to that appeal, Scotiabank has an established cadence of providing annual upticks to that dividend.
In other words, Scotiabank is a buy-and-forget stock that could build lasting wealth.
For growth, Scotiabank and its peers have turned to international markets. Scotiabank has put a focus on high-growth markets in Latin America over the past decade, but that focus is now shifting towards the U.S. market.
You can build lasting wealth starting today
The importance of diversifying, along with investing early, cannot be understated enough. In the case of the three stocks mentioned above, they all offer some defensive appeal coupled with juicy dividends.
To put it another way, that trio of stocks could handily build lasting wealth for decades through reinvested dividends.
In my opinion, one or all of the above belong as part of any well-diversified portfolio. Buy them, hold them, and watch them grow.
