I’d argue that it’s always a good time for investors to consider dividend stocks to buy for passive income. Whether you’re just starting out in your investing journey or are a seasoned pro looking to sail off into retirement with a fashionable passive income stream, there are a myriad of reasons why investors focus on companies that pay out dividends over time.
Personally, the thing I like most about such stocks is the implied stability that’s required in order for such companies to not only pay out a dividend but continue to increase their distributions over time.
Here are two of my top dividend ideas for baby boomers looking to enter retirement with a solid nest egg (and some passive income to boot).
Source: Getty Images
Fortis
No surprise here, but Fortis (TSX: FTS) is once again my top pick on this list of dividend stocks to consider for passive income. That’s not only because of the company’s 3.8% dividend yield. It’s because Fortis is one of the best dividend growth stocks Canada has to offer.
Indeed, Fortis has raised its dividend distribution for more than 50 consecutive years, positioning the company as a dividend king I think investors can own in up and down markets. That’s because Fortis’ core business model revolves around providing regulated utilities to a range of commercial and residential customers.
With a very low likelihood of the company’s cash flow falling off a cliff, this is a stock that should see predictable earnings growth over time as regulators approve price increases.
For long-term investors looking for dividend stability in a market marred by uncertainty, this is a top name to consider in my books.
Toronto-Dominion Bank
In the financials sector, Toronto-Dominion Bank (TSX: TD) remains one of the top options I think long-term dividend investors can get behind.
Most of the investing thesis is quite similar to that of Fortis. Outside of specific periods where regulators did not allow the bank to raise its dividend, TD has done a fantastic job of raising its distribution in a consistent (and meaningful) fashion over the years.
With a dividend yield of 4.1% and strong market share in both the Canadian and U.S. retail banking markets, TD remains a top option for investors looking to play the entire North American banking landscape.
In my view, TD stock is a great way for investors to gain exposure to the overall growth that should be realized within the North American economy. This remains a top pick of mine from a dividend, value, and total return perspective over the long term.
