Turning 40 can be a financial wake-up call. Although retirement may still be decades away, today’s financial decisions can significantly shape your future lifestyle. Whether you are on track or struggling to build your nest egg, now is the time to review your savings, refine your investment strategy, and strengthen your financial future.
So, how much should you have saved by age 40? A widely used retirement-planning guideline suggests saving three times your annual salary by this milestone. While this isn’t a universal target, it offers a useful benchmark for tracking your progress.
If you fall short, it does not mean you have run out of time. With potentially higher earnings and two decades or more before retirement, you can still build substantial wealth through consistent saving and long-term investing.
A practical starting point is to allocate 15% to 20% of your income toward retirement. Investing regularly and increasing contributions as your income grows can help accelerate your progress.
However, saving more is only part of the equation. Your investment choices also influence long-term outcomes. Stocks offer significant growth potential over time, but market volatility can expose investors to substantial losses. Diversifying your portfolio across multiple assets can help manage risk while supporting long-term growth.
For investors looking to allocate a portion of their savings to stocks, focus on Canadian companies with strong fundamentals, including robust revenue and earnings, a solid balance sheet, and consistent market demand.
Against this backdrop, here are top TSX stocks to consider now.
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Aritzia stock
Aritzia (TSX: ATZ) is a compelling long-term pick, with strong growth and the ability to deliver attractive returns. The fashion retailer has consistently posted double-digit revenue and earnings growth, driving its share price higher over the years.
Over the past five years, Aritzia’s stock has grown at an annualized rate of 25.5%, outperforming the broader market. This momentum could continue as the company builds on its growth strategy and expands its market presence.
Aritzia’s revenue growth is likely to benefit from its focus on refreshing product offerings and responding to changing customer preferences. Its efforts to keep customers engaged and manage inventory efficiently also support its growth prospects. At the same time, investments in new boutiques, digital capabilities, and marketing have helped to drive brand visibility.
Looking ahead, continued sales growth, full-price selling, and better inventory management could help improve earnings. Overall, Aritzia’s strong brand, consistent growth, and focus on operational efficiency make it a worthwhile long-term investment.
Bird Construction stock
Bird Construction (TSX: BDT) stock could be another solid long-term investment. The company is positioned to benefit from Canada’s infrastructure spending, as increased investment by governments and private-sector businesses drives demand for construction and maintenance services.
Bird has significant exposure to several high-growth sectors, including defence, healthcare, nuclear energy, liquefied natural gas (LNG), renewable power, data centres, critical minerals, and transportation infrastructure. These industries are expected to attract considerable capital investment in the coming years.
Its expanding project backlog further supports revenue and earnings visibility. During the second quarter, Bird continued to secure additional awarded and contracted projects. The backlog composition has also improved, with a larger share of collaborative, lower-risk contracts that offer the potential for stronger margins.
Supported by a healthy balance sheet, a robust pipeline of upcoming projects, and an acquisition strategy focused on enhancing shareholder value, Bird Construction appears well positioned to deliver solid growth.
