Demand for retirement income solutions is growing. Increases in the number of self-employed and self-directed investors in Canada continue to support growth in annuity sales as individuals look to secure a guaranteed passive income stream in retirement. Canadians nearing retirement face a critical choice today: go for absolute income certainty with annuities or take a chance on capital growth and liquidity with dividend stocks. Your choices won’t be simple, and the ultimate decision will depend on a few factors we can discuss here.

On one side stands annuities, insurance contracts that may convert a lump sum into contractually guaranteed lifetime cash flow. On the other side stands dividend-paying Canadian stocks, assets that generally generate recurring regular income while potentially growing your underlying capital as stock prices rise. Evaluating this choice requires looking beyond initial yields to examine longevity risk, inflation defence, tax efficiency, and ability to control your capital.

Annuity income guarantees versus inflation defence

Annuities excel at creating a guaranteed, regular income payment stream, and if you go with a lifetime payout option, they can completely eliminate the risk of outliving your capital (longevity risk) as well as the sequence-of-returns risk that equity portfolios may possess (if a severe market downturn coincides with the onset of your retirement).

Backed by Assuris protection for up to $5,000 per month or 90% of promised benefits (whichever is higher), a single life annuity ensures you can’t outlive your income regardless of market downturns. How is that possible? Annuitants who pass on earlier than their statistically expected lifespans “donate” their capital and payouts to those who live longer.

However, the peace of mind from annuities comes with a hidden cost: inflation risk. Most Canadian annuity payouts are fixed in nominal dollars. A constant income stream that feels generous at age 65 can suffer severe purchasing power erosion by age 82, threatening a retiree’s ability to maintain a desired lifestyle. Indexed annuities do offer inflation protection, but they often start with lower initial payouts.

Interestingly, dividend stocks offer the exact antidote to long-term inflation. High-quality businesses across Canadian banking, energy infrastructure, utilities, and senior housing industries often possess proven structural pricing power. As their operating cash flows expand, these large-cap stocks routinely raise their dividends to shareholders. Over a multi-decade retirement, dividend growth may preserve real purchasing power in a way fixed annuities can’t match.

Annuities vs. dividend stocks: Growth and the capital control dilemma

The trade-off between annuities and dividend stocks extends directly to your personal balance sheet flexibility and tax efficiency. Purchasing a traditional annuity is often an irreversible decision that irrevocably forfeits capital liquidity and estate transfer capabilities. In contrast, holding Canadian dividend stocks maintains complete control over your principal, leaving capital available for unexpected medical emergencies or wealth transfer to beneficiaries.

Most noteworthy is the growth divergence. Dividend stocks have often increased a retirement investor’s capital. For example, the iShares Core MSCI Canadian Quality Dividend Index ETF (TSX: XDIV) has generated a total return of nearly 250% over nearly a decade, with dividends fully reinvestment. The dividend exchange traded fund (ETF) has raised its monthly dividends by 79% over the period, beating inflation. Even if an investor withdrew all monthly dividends to fund living expenses, their capital could have grown about 133% higher since 2017. The ETF charges a low management expense ratio (MER) of 0.11% annually.

XDIV data by YCharts

Further, in non-registered taxable accounts, Canadian dividend stocks also enjoy superior tax mechanics. Eligible dividends receive preferential treatment via the Canadian Dividend Tax Credit, often resulting in lower effective tax rates for low-income retirees compared to annuity fixed income.

While non-registered prescribed annuities provide level tax treatment by spreading capital and interest payments evenly, registered annuities may remain fully taxable as regular income upon withdrawal.

An optimal retirement investment strategy

A sound wealth management framework balances asset allocation between competing passive income sources in retirement.

As retirement nears, you may tally your essential, non-negotiable living expenses. Any gap between these fixed lifestyle costs and guaranteed government benefits like CPP and OAS payouts can be closed using a fixed annuity. Once your baseline living costs are fully insured against market volatility, the remaining capital may be deployed into a diversified portfolio of Canadian dividend growth stocks.

This hybrid investment model secures absolute peace of mind for daily survival while capturing the capital growth, inflation protection, and tax efficiency desirable for a flourishing retirement.

The post Dividend Stocks or Annuities for Retirement Income? appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Back in August 2025, I made a bullish case for Primaris Real Estate Investment Trust (TSX: PMZ.UN) as a long-term passive income investment over a 10-year holding period. At the time, units traded at a steep 30% discount to their Net Asset Value (NAV), and offered a rich 5.8% distribution yield. Fast forward to today, and the market has finally woken up to the Canadian retail REIT’s attractive offerings. Units have rallied about 50% since, compressing the trust’s distribution yield to 4.1%.

While a 4.1% yield might seem less flashy on the surface, passive income investors, especially retirees, shouldn’t look away. Primaris REIT is an even higher-quality investment today than it was a year ago. What began as a deep-value turnaround play has matured into a premier, high-quality monthly dividend-growth compounder one can confidently buy for monthly retirement income.

Primaris REIT’s October catalysts

During an investor day presentation on October 7, Primaris REIT unveiled updated three-year performance targets that significantly elevate its distribution growth trajectory through 2029. Most notably, management has doubled its targeted annual distribution growth rate from 2%–4% up to an impressive 4%–8% per year. This payout growth is anchored by strong operational execution, with long-term Funds From Operations (FFO) per unit growth targeted at 4%–8% annually.

To achieve its more ambitious latest targets, Primaris is firing on multiple operational cylinders. The REIT, which continues to build an exclusive portfolio of enclosed shopping malls, recently completed a landmark $411 million acquisition of Upper Canada Mall in the Greater Toronto Area. The deal, which closed days after the trust raised $230 million in new equity, adds a property with high foot traffic sourced from high-income households. It elevates the trust’s overall portfolio quality.

Simultaneously, management is aggressively converting lower-rent anchor spaces, such as former Hudson’s Bay department store locations, into vibrant footprints leased to high-traffic national retailers. Re-tenanting these large spaces is unlocking significant Net Operating Income growth at fourfold rent spreads over legacy leases.

Why buy PMZ.UN for sustainable retirement income

Primaris REIT presents a compelling operational model for retirees who depend on regular distributions to meet monthly living expenses. Unlike traditional dividend stocks that distribute cash quarterly, Primaris currently pays unitholders a $0.07 per unit monthly distribution that fits seamlessly into a monthly retirement spending plan.

What makes the retail REIT’s monthly cash flow particularly appealing is its potential durability. Primaris boasts one of the most conservative distribution safety profiles in the Canadian REIT sector, maintaining an FFO payout ratio under 50% and an Adjusted Funds From Operations (AFFO) payout ratio near 66%. This conservative payout structure guarantees that the monthly distribution remains secure even during economic downturns, while leaving substantial retained cash flow to fund internal redevelopments without over-leveraging the real estate portfolio.

Inflation poses another ongoing challenge for retirees relying on fixed-income investments. A static dividend loses purchasing power over a multi-decade retirement. By targeting annual distribution hikes between 4% and 8% through 2029, Primaris REIT promises to raise the payout at rates that outpace general inflation rates in Canada.

As Canada’s only REIT focused strictly on enclosed shopping centres, Primaris currently benefits from zero new supply competition. Soaring construction costs and land constraints make building new enclosed malls exceedingly challenging in Canada today, providing existing dominant centres with exceptional tenant retention and lease pricing power.

Valuation considerations

While PMZ.UN no longer offers the fire-sale 30% discount seen in mid-2025, its current valuation remains fair and reasonable given the enhanced quality of its asset base. Trading near its reported NAV of $21.72 per unit, unitholders are paying fair value for a well-occupied premier commercial portfolio.

Supporting this fair valuation is an investment-grade financial fortress. Primaris holds nearly $5 billion in unencumbered assets, maintains a conservative 40.5% debt-to-assets ratio, and commands over $650 million in total liquidity. This financial flexibility enables management to weather broader market volatility while continuously executing strategies that will support growing distributions to unitholders.

Foolish bottom line

Chasing the highest yields often leads to painful dividend traps that may slow the growth of a retirement portfolio. Sustainable wealth in retirement can be maintained and built from reliable, growing passive income streams, and PMZ.UN has been a wonderful total return performer, historically.

PMZ.UN data by YCharts

Primaris REIT may yield 4.1% today instead of a historical 5.8%, but its risk profile is lower, its growth guidance has doubled, and its property portfolio is stronger than ever. Income-focused investors seeking monthly cash flow that consistently beats inflation may consider buying and holding Primaris REIT units for the long haul.

The post A 4.1% Dividend Stock Worth Considering for Monthly Retirement Income appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool recommends Primaris Real Estate Investment Trust. The Motley Fool has a disclosure policy.

Securing a dependable stream of high-yield passive income is often top of mind for investors transitioning into retirement. While the broad Canadian market offers plenty of quarterly dividend options, few income investments match the cash flow predictability of pure-play industrial real estate that pays unitholders directly on a monthly schedule. Nexus Industrial Real Estate Investment Trust (TSX: NXR.UN), a growth-oriented Canadian REIT, recently declared a monthly distribution of $0.05 per unit. At recent market prices around $7.05, this payout translates to a staggering 9% annualized yield, offering Canadian retirees an attractive dividend stream for compounding monthly income.

Nexus Industrial REIT: A high-yield passive income play backed by long-term leases

Building a resilient retirement portfolio requires looking beyond current yields. To ensure your monthly dividend cheque remains reliable, it’s necessary to evaluate the underlying real estate assets generating that cash flow.

Following a deliberate transition from a diversified landlord into a focused industrial operator, Nexus Industrial REIT currently holds a portfolio of 87 properties comprising roughly 12.3 million square feet of gross leasable area (GLA). Crucially for Canadian income-focused investors, the trust boasts a weighted average lease term of 6.7 years.

This extended duration means the portfolio should remain predominantly occupied by rent-paying logistics and warehousing tenants nearly seven years into the future, providing long-term earnings and cash flow visibility for your high-yield monthly passive income strategy.

Is the 9% distribution safe for Canadian retirees?

Admittedly, income investors should examine the Nexus Industrial REIT distribution’s recent stress test. The REIT caught market attention in its second-quarter earnings report when its normalized adjusted funds from operations (AFFO) payout ratio drifted to 102.2%. Because AFFO represents a REIT’s truest measure of recurring distributable cash flow after funding capital expenditures and leasing costs, a payout ratio exceeding 100% naturally sparks safety questions. However, management expects this uptick to prove temporary, anticipating the normalized AFFO payout ratio to average below 100% for the full year 2026.

Built-in growth: Positive rent spreads to provide a cash flow pathway

One key catalyst to bring Nexus REIT’s payout metrics back into safe territory is the trust’s significant organic rent growth potential. Portfolio occupancy recently inched higher to a tight 97%, while the industrial portfolio’s average in-place rents sit 14.9% below prevailing market rates across Canada. As existing lease agreements mature, Nexus is capturing substantial positive re-leasing spreads.

During the second quarter alone, management re-leased 380,000 square feet of renewals at an average 6% rental spread over expiring rates, pushing same-property net operating income higher. As these market-rate mark-ups combine with newly completed development projects and property acquisitions, distributable cash flow per unit should steadily grow over upcoming quarters.

An investment-grade balance sheet lowering capital costs

Equally encouraging for retirement investors is Nexus Industrial REIT’s balance sheet overhaul taking place in the background. Early this year, Nexus earned an investment-grade credit rating, unlocking access to lower-cost institutional debt. The trust capitalized on this credit enhancement by issuing an inaugural $500 million bond offering in the second quarter, followed by a $300 million debenture offering in September. By refinancing expensive bank credit lines with lower-cost fixed-rate debt, Nexus is structurally lowering its weighted average cost of capital and safeguarding future cash flow for unitholders.

Deep value income opportunity at a 47% discount

The final element of an investment idea on Nexus Industrial REIT is its valuation. Going into the third quarter, the trust reported a net asset value (NAV) of $13.23 per basic unit. Trading around $7.05 at writing, REIT units sell at a massive 46.7% discount to their intrinsic real estate value today.

Even if higher Canadian bond yields prompt fair-value property markdowns, a near 50% discount offers an exceptionally wide margin of safety.

Nexus REIT presents a compelling retirement investment opportunity for contrarian investors targeting high-yield passive income. Its generous 9% monthly payout today, paired with substantial capital appreciation upside as the market eventually re-rates units higher toward its net asset value, may offer outsized long-term returns in a dividend portfolio.

The post A 9% Dividend Stock for a Monthly Retirement Cheque appeared first on The Motley Fool Canada.

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• Why Your Retirement Number Depends More on Spending Than Salary

Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool recommends Nexus Industrial REIT. The Motley Fool has a disclosure policy.

Thinking that your Tax-Free Savings Account (TFSA) strategy is evergreen and perfect for retirement is a bit like assuming the same pair of shoes will work for every part of your journey. While you’re earning a paycheque, you can afford to let your TFSA focus heavily on growth because you don’t need it to pay the grocery bill. Once that paycheque disappears, you’d want the account to behave differently.

Turning a retirement TFSA into an ultra-conservative portfolio may feel reassuring, but you could still need that money working for another 20 or 30 years. That means you might want to balance steady income with continued growth so you aren’t forced to sell investments too often. But unfortunately, some common TFSA habits could make achieving that balance more difficult.

Let me highlight two habits I’d reconsider in retirement and how some fundamentally solid Canadian stocks could help solve the problems they create.

Relying too heavily on capital gains

Chasing capital appreciation could work well when your retirement is years away, and you do not need portfolio income. After retirement, however, relying on selling shares to generate cash could make your portfolio more dependent on market fluctuations. And a quality stock like Canadian National Railway (TSX: CNR), or CN, shows how investors could keep pursuing growth without depending entirely on selling shares for cash.

CN operates a nearly 20,000-mile rail network connecting Canada’s eastern and western coasts with the U.S. Midwest and Gulf Coast. After gaining 27% over the last 12 months, its stock currently trades at $169.87 per share with a market cap of $102.2 billion. At this market price, it offers a 2.2% annualized dividend yield.

In the second quarter, CN’s revenue jumped 11% year-over-year (YoY) to about $4.8 billion, while its revenue ton-miles rose 5%, driven mainly by strong grain and energy volumes. As a result, the company’s net profit climbed 7% YoY to roughly $1.2 billion.

During the first half of 2026, CN also generated about $1.8 billion in free cash flow. That cash generation matters for a dividend-paying business as it gives the company flexibility to fund its operations, invest in its rail network, and return capital to shareholders.

Moreover, CN has room for further growth as it plans roughly $2.8 billion in capital investments this year alone. For retirees, that great combination of income and growth is what makes CNR attractive.

Becoming too conservative after years of saving

If the first mistake is depending too much on growth, the second is giving up on it altogether. And a stock like Great-West Lifeco (TSX: GWO) could help retirees avoid that extreme by pairing dividend income with rising earnings.

Simply put, this Winnipeg-based company provides retirement, wealth, workplace benefits, and solutions across Canada, the United States, and Europe. GWO stock trades at $91.42 per share with a market cap of roughly $81.5 billion. Despite its 68% gain over the last year, the stock still offers a 3% dividend yield.

Great-West’s second-quarter base earnings rose 11% YoY to nearly $1.3 billion. Its U.S. business has also been strong. This segment’s base earnings jumped 34% YoY in constant currency last quarter, helped by higher fee income from growing client assets, positive plan and wealth net inflows, and lower credit-related impacts.

Meanwhile, the company is also investing capital to accelerate its future growth. On September 2, Great-West’s subsidiary Empower completed its acquisition of Milliman’s retirement plan and benefits administration business. The deal added about 400 defined benefit plans and more than 1,100 defined contribution plans, representing roughly US$130 billion in combined client assets.

Retirees who become too defensive could still get a 3% dividend yield while maintaining exposure to a business growing earnings and expanding its retirement platform. In other words, retirement does not have to mean giving up on growth.

The post 2 TFSA Habits That Work While Saving But Backfire in Retirement appeared first on The Motley Fool Canada.

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Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool recommends Canadian National Railway. The Motley Fool has a disclosure policy.

Investing in the stock market doesn’t always have to be complicated, especially when you’re building a retirement portfolio that may have decades to grow. In fact, constantly buying, selling, and chasing the market’s next big winner could make investing feel like far more work than it needs to be. I’d rather find a strong business that can keep growing earnings, pay me dividends along the way, and give compounding enough time to work.

Great-West Lifeco (TSX: GWO) fits that approach surprisingly well. Its shares have surged by 72% over the last year, and the business has been improving as well. In this article, I’ll explain why Great-West Lifeco could be one stock to start with for Canadians who want a simpler path toward building a bigger retirement portfolio.

Great-West Lifeco stock

If you want to keep your retirement strategy simple, Great-West Lifeco gives you a large and diversified financial services business to consider. Headquartered in Winnipeg, Great-West operates across Canada, the United States, and Europe through brands such as Canada Life, Empower, and Irish Life. Its operations cover retirement, wealth management, group benefits, insurance, annuities, and risk solutions.

Up 38% year-to-date, GWO stock currently trades at $93.34 per share, giving the company a market cap of $83.5 billion. Even after that strong run, the stock still offers an annualized dividend yield of 2.9%.

This rally in the stock has mainly been supported by the company’s improving performance. Notably, Great-West delivered double-digit earnings growth, rising client assets, stronger returns on equity, and continued share repurchases.

Earnings growth strengthens its fundamentals

For a relatively hands-off retirement strategy, you need to make sure that the company you’re investing in has the ability to compound its earnings for many years. And Great-West appears well positioned on that front.

In the second quarter of 2026, its base earnings climbed 15% year-over-year (YoY) to about $1.42 per share. The financial services company’s net earnings also jumped 20% from a year ago to $1.16 per share. Growth in its retirement and wealth businesses, led by Empower, was a major driver of those solid results, while strong new business growth in its capital and risk solutions also helped.

At the same time, Great-West’s U.S. segment delivered a 34% YoY increase in base earnings in constant currency, backed by higher fee income, favourable markets, and positive plan and wealth net inflows.

As a result, the company posted a 19.3% base return on equity, up from 17.4% a year ago. Its total client assets reached about $3.7 trillion at the end of the quarter, reflecting 12% growth from the end of the previous year.

A bigger retirement platform

In September, its Empower subsidiary completed the acquisition of Milliman’s retirement plan and benefits administration business. The transaction added roughly 400 defined benefit plans with about 790,000 participants and US$80 billion in client assets. It also added more than 1,100 defined contribution plans representing about 750,000 participants and more than US$50 billion in client assets.

Following the deal, Empower’s footprint expanded significantly to over US$2.3 trillion in client assets and 96,000 workplace plans. This larger platform should give Great-West more scale across retirement and workplace benefits services going forward.

These are some of the key reasons why I believe Great-West stock offers Canadians an appealing combination of earnings growth, retirement-focused expansion, dividends, and share buybacks. That’s why GWO could be an attractive stock to buy and hold while compounding does the rest, especially for investors looking for a simpler path toward a bigger retirement portfolio.

The post The Lazy Canadian’s Path to a Bigger Retirement: 1 Stock to Start With appeared first on The Motley Fool Canada.

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Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

No one wants to approach their retirement years wondering whether they saved enough or whether their portfolio can keep supporting them once the paycheques stop. That’s why I think a great retirement stock should do more than simply pay a dividend. Ideally, a retirement stock should be capable of growing the value of my investment for years while steadily returning cash along the way.

That said, Power Corporation of Canada (TSX: POW) offers a reliable combination of both. Through its major holdings, it gives exposure to retirement services, insurance, and wealth management businesses. In this article, I’ll explain why Power Corporation’s mix of financial businesses, dividends, and long-term growth potential could make it a retirement game-changer.

A great retirement stock with multiple growth engines

If you don’t know it already, this Montreal-based holding company has major holdings such as Great-West Lifeco and IGM Financial. It also has interests in businesses such as Wealthsimple and alternative asset manager Sagard.

Lately, Power Corporation stock has been on an impressive run as its shares have surged about 64% over the last year. As a result, it now trades at $95.28 per share, giving it a market capitalization of about $54.5 billion. On top of those gains, the stock offers a dividend yield of roughly 2.8% at the current price.

The recent rally in POW stock could mainly be attributed to rising value across several of Power Corporation’s underlying investments. Let’s take a closer look.

Strong businesses are supporting the retirement story

Power Corporation’s adjusted net asset value climbed nearly 32% from the end of 2025 to $112.94 per share at the end of June 2026. More importantly for retirement investors, several of its core businesses continue to grow.

In the second quarter, the company’s adjusted net profit climbed nearly 10% year-over-year (YoY) to $974 million. At the same time, its adjusted earnings per share (EPS) also rose to $1.55 from $1.38.

Its subsidiary Great-West’s adjusted net earnings in the latest quarter rose 11% YoY to $1.3 billion with the help of continued momentum in its retirement and wealth businesses.

Meanwhile, IGM’s adjusted net earnings jumped 31% YoY to $330 million. Its assets under management and advisement climbed nearly 21% from a year ago.

More importantly, Power Corporation is also benefiting from growth beyond these traditional businesses. Wealthsimple reached 3.6 million clients by the end of June, while its assets under administration soared 84% YoY. Similarly, Sagard’s assets under management reached US$46.9 billion after it acquired Unigestion.

More ways to build retirement wealth

POW’s appeal as a retirement stock becomes even clearer when you consider how it balances returning capital to shareholders with investing for future growth. During the first six months of 2026, the company returned $1.5 billion to shareholders, including $800 million in dividends and $700 million through share repurchases.

At the same time, Great-West is expanding its retirement business through Empower’s acquisition of Milliman’s retirement plan and benefits administration business. This acquisition is expected to add roughly US$130 billion in client assets and 1.5 million plan participants to Empower’s Workplace Solutions platform.

Clearly, Power Corporation brings several attractive retirement-building qualities together in one investment. Its expanding financial businesses, growing asset values, quarterly dividends, and significant capital returns could help investors generate income while building long-term wealth. That definitely makes it worth a closer look for retirement portfolios today.

The post This Stock Could Be a Retirement Game-Changer appeared first on The Motley Fool Canada.

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Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Investing during retirement requires a fundamental mindset shift. The primary goal is no longer about chasing hyper-growth stocks or beating the TSX during explosive bull runs. Instead, it becomes about capital preservation, keeping pace with inflation, and generating reliable passive income to fund daily living. High-quality Canadian dividend stocks offer an ideal middle ground by delivering steady passive income alongside modest long-term growth to retirees stepping away from a regular paycheck.

When building a low-risk income portfolio, market volatility is your biggest enemy. That is why tracking a stock’s five-year beta relative to the S&P/TSX Composite Index is crucial. While standard international stock screeners measure volatility against the technology-heavy S&P 500, benchmarking against the TSX tests how a company holds up against domestic market swings in energy, materials, and banking sectors. A five-year TSX beta between 0.40 and 0.45 means a stock potentially experiences less than half the volatility of the broader Canadian market, making regulated utilities a premier choice for risk-averse investors, including retirees.

Three top dividend stocks for retirees

Given the selection criteria, utilities rise to the top here. Three of these top TSX dividend stocks to buy in retirement would include Fortis (TSX: FTS) stock, Emera (TSX: EMA), and Hydro One (TSX: H) stock.

Let’s take a closer look.

Why Fortis stock is a retirement investor’s dream

Fortis stock stands as the gold standard of Canadian dividend income investing. Offering a 3.4% dividend yield, Fortis boasts a remarkable 52-year dividend-growth streak. Investors in FTS stock have experienced a 650% total dividend growth over the past 35 years.

The Canadian utility’s expansive network of 99% regulated electric and gas distribution assets across North America delivers exceptional revenue, earnings, and cash flow visibility. Supported by a disciplined capital deployment program, management projects annual payout growth between 4% and 6% through 2028.

With a low TSX beta of 0.43 and a conservative payout ratio of 70% to 75%, Fortis stock provides an enduring foundational anchor for retirement portfolios.

Emera stock’s higher upfront yield attractive for retirees

Among the three top dividend stocks for retirees, Emera stock serves investors seeking a higher immediate cash return very well. Operating regulated electric and gas utilities in Florida and Atlantic Canada, Emera offers an attractive 4.2% dividend yield. The payout is backed by a 19-year growth streak. While near-term dividend increases are expected to moderate to 1% to 2% as management prioritizes balance sheet deleveraging and asset sales, the utility targets a safe payout ratio of 65% to 70%.

Given its five-year beta of 0.45 against the TSX, Emera stock delivers relatively low-risk dependable upfront income coupled with long-term economic expansion.

Hydro One stock

Hydro One functions as a pure-play monopoly on Ontario’s electric transmission grid, controlling roughly 98% of the province’s high-voltage lines. Although its 2.6% initial dividend yield is lower than its utility peers, investors willingly pay a premium for its structural stability and an undisturbed 10-year dividend-growth streak.

The Canadian utility appointed Megan Telford as president and CEO in June 2026, maintaining operational momentum. Hydro One continues to grow its asset and revenue base. It invested $812 million in capital projects in the second quarter alone, pushing year-to-date capital deployment past $1.5 billion. New investments, and favourable rate increases may comfortably support steady 5% to 6% annual dividend-growth rates in the near future.

Backed by a tight 60% payout ratio and a 0.40 beta against the TSX, Hydro One stock appeals as a low-risk Canadian dividend stock to buy and hold in retirement.

Three top TSX dividend stocks for retirement passive income

Fortis stock, Emera, and Hydro One stock could pay reasonable dividends, add low-risk growth potential, and grow a passive-income stream. Here’s a summary of their key attributes to consider for retirement plan income investing.

Combining these three defensive Canadian dividend stocks creates a resilient retirement income portfolio capable of weathering economic cycles, and trade wars, while insulating a golden-years nest egg from broader market turbulence.

The post These 3 Canadian Dividend Stocks Are Great for Retirees appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool recommends Emera and Fortis. The Motley Fool has a disclosure policy.

Retirement planning looks different for everyone, but one thing rarely changes. Most Canadians want enough savings to enjoy life without constantly worrying about money. That is where a Tax-Free Savings Account (TFSA) could become one of your most valuable retirement tools.

While many Canadians prefer to build large TFSA balances over the years, the average account value still falls well short of what could generate meaningful retirement income. If your goal is to create a steady stream of tax-free cash, it could pay off well to think bigger and invest wisely along the way.

How much should you aim for

There is no one-size-fits-all retirement number because everyone’s lifestyle and expenses are different. Even so, the latest Canada Revenue Agency data suggests many Canadians may need to keep building their TFSAs. For example, Canadians aged 65 to 69 had an average TFSA fair market value of $51,244, while those aged 70 to 74 averaged $56,106.

While those balances can certainly supplement retirement income, they’re unlikely to be enough on their own for most retirees. If you want your TFSA to become a dependable source of tax-free income throughout retirement, aiming for a portfolio in the high six figures, or even $1 million over the long term, could put you in a much stronger financial position.

While reaching that goal won’t happen overnight, decades of consistent contributions, dividend reinvestment, and owning high-quality Canadian dividend stocks could make a big difference. Let me highlight two such Canadian investments that could help you get there.

Royal Bank of Canada stock

If you’re looking to build dependable retirement income over the long term, Royal Bank of Canada (TSX: RY) could be a great place to begin.

Being Canada’s largest bank, it operates across personal and commercial banking, wealth management, insurance, and capital markets. Its shares currently trade at $302.13 per share with a market capitalization of $419.9 billion. RY stock has surged 65% over the last year and currently offers a 2.3% annualized dividend yield.

This strong share price performance has been backed by impressive business growth. In its second quarter of fiscal 2026, Royal Bank reported net income of $5.5 billion, up 25% year-over-year (YoY), while diluted earnings per share jumped 27% to $3.85. Growth came from stronger capital markets revenue, higher wealth management fees driven by market appreciation and client inflows, and higher net interest income in both its personal and commercial banking businesses. Lower provisions for credit losses also supported earnings growth.

With consistent earnings growth, a strong balance sheet, and a long history of rewarding shareholders, Royal Bank remains an attractive dividend stock to own for investors building a retirement-focused TFSA.

Brookfield Renewable stock

If you’d like to add a higher-yield investment to your retirement portfolio, Brookfield Renewable Partners (TSX: BEP.UN) deserves a closer look on the TSX today.

Brookfield Renewable owns and operates hydroelectric, wind, solar, battery storage, and other renewable energy assets across North America, South America, Europe, and Asia-Pacific. Its shares currently trade at $44.56 apiece with a market cap of $13.6 billion and offer a healthy 4.9% annualized dividend yield. Even after a recent pullback, the stock remains up 21% over the last year.

Brookfield Renewable reported record funds from operations in the first quarter of 2026, reflecting strong performance across its global renewable energy platform. During the quarter, the company delivered about 1,800 megawatts of new capacity and contracted roughly 1,700 megawatts of projects from its advanced development pipeline. It also continued to target annual project deliveries of about 10,000 megawatts by 2027.

This great combination of a diversified global portfolio, reliable cash-generating assets, and a strong development pipeline positions Brookfield Renewable well for long-term growth. Its higher dividend yield also makes it an attractive complement to a blue-chip bank stock for Canadians looking to build more tax-free retirement income inside a TFSA.

The post Canadians: Here’s How Much You Need Saved in Your TFSA to Retire appeared first on The Motley Fool Canada.

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Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool recommends Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

Having a workplace pension plan you can count on during your golden years is a beautiful retirement path. Unfortunately, for the vast majority of Canadians, retirement planning reality hits incredibly hard.

Only a tiny handful of workers enjoy this retirement passive income “luxury” today. According to recent Statistics Canada data, only 7.2 million Canadians were active members of a registered pension plan (RPP) by 2023. That represents a mere 18% of the total population and only about 37.7% of the working population.

Worse still, unlike the gold-plated defined-benefit plans enjoyed mostly by public sector workers, private sector employees are largely left with defined-contribution plans. That means the retirement income you eventually get depends entirely on what you contribute. The entire burden of funding retirement, and the terrifying risk of outliving your portfolio, sits squarely on your shoulders.

But here is the good news: you don’t need a corporate boss to build a gold-plated retirement plan for you. By utilizing tax-efficient retirement investment tools like the TFSA and RRSP, you can build a flexible, cash-flowing DIY pension using the power of the Toronto Stock Exchange.

Core pension creation strategy: Reinvest, don’t liquidate

Traditional retirement “savings” advice tells you to systematically sell off your investments, including stocks, for income. But that forces you to worry constantly about bad market timing.

I believe there’s a better way. In the equity portion of your portfolio allocations, you could focus on buying and holding high-quality, cash-generating dividend stocks that pay you monthly or quarterly cash distributions. By targeting well-established companies with proven business models, strong economic moats, and stable cash flows, you ensure that your pension income recurs year after year, regardless of the volatility that happens in the stock markets.

If you want to build this retirement passive income engine from scratch, here are two incredible TSX heavyweights to anchor your DIY pension portfolio.

Pension plan anchor: The Vanguard FTSE Canadian High Dividend Yield ETF

For instant diversification in your dividend portfolio, consider the Vanguard FTSE Canadian High Dividend Yield Index ETF (TSX: VDY). Boasting roughly $8.6 billion in assets under management, the VDY is a massive exchange traded fund (ETF) tracking 60 of the highest-yielding, most sustainable dividend payers on the TSX. It pays monthly dividends, mimicking traditional monthly pension paycheques. The VDY ETF has raised payouts by 40% over the past 10 years, preserving investors’ income from inflation.

The portfolio is heavily anchored by Canada’s most resilient economic sectors: financial stocks make up 57.6%, followed by energy at 28.9% and utilities at 4.7%. Even better, it is incredibly cheap to own. With a management expense ratio (MER) of just 0.22%, you pay just $2.20 annually for every $1,000 invested and keep almost all the investment gains for yourself.

The VDY’s proof is this dividend portfolio anchor’s historical performance. A $10,000 investment in the monthly dividend ETF five years ago would have grown to more than $23,400 today, with dividends reinvested.

The passive income booster: Toronto-Dominion Bank (TD) stock

While an ETF gives you instant diversification, adding an elite single stock like the Toronto-Dominion Bank (TSX: TD) injects powerful dividend and capital growth potential into your pension portfolio.

TD is a compelling buy-and-hold-forever dividend stock. The Big Five banking giant has paid uninterrupted dividends to its shareholders since the 1850s. Even better, it has more than doubled its payout size over the past decade alone, offering retirees a potent defence against inflation.

Following a strong underlying performance in its latest operations, TD Bank stock recently raised its quarterly dividend up another 3.7% to $1.12 per share. Backed by a rock-solid capital position, TD’s earnings and cash flow generation capacity promises to remain resilient even during broader macroeconomic shifts.

The Foolish bottom line

Building your own pension plan doesn’t require a massive stroke of luck. You can construct a vibrant, liquid, and inflation-protected passive income stream tailored perfectly to your intended retirement lifestyle by combining broadly diversified, monthly paying dividend ETFs with historical dividend growth machines like TD Bank stock. Turn on a Dividend Reinvestment Plan (DRIP) early, and let compounding do the multi-year heavy lifting to build a respectable retirement nest egg.

The post How to Create Your Own Pension With Dividend Stocks appeared first on The Motley Fool Canada.

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Fool contributor Brian Paradza has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

A Tax-Free Savings Account (TFSA) could undoubtedly become a powerful retirement tool, but many Canadians may still have a long way to go. Canada Revenue Agency data show that the average TFSA fair market value was $45,109 for people aged 60 to 64 and $51,244 for those aged 65 to 69 in the 2023 contribution year. Although the right retirement amount will depend on your spending needs and other income sources, these balances show why consistent investing matters.

In this article, I’ll highlight three dividend-paying TSX stocks that could help Canadians steadily build a larger TFSA retirement fund.

TD Bank stock

If your goal is to build a larger TFSA retirement fund over time, Toronto-Dominion Bank (TSX: TD) could be a good place to start. As one of Canada’s largest financial institutions, it offers personal and commercial banking, wealth management, insurance, and wholesale banking services across Canada and the United States.

TD stock currently trades at $172.81 per share with a 34% year-to-date gain and a market cap of roughly $289 billion. It also offers an annualized dividend yield of around 2.6%.

In the second quarter of its fiscal 2026 (ended in April), TD’s adjusted net income climbed 15% year-over-year (YoY) to $4.2 billion. The bank’s Canadian personal and commercial banking segment posted a 15% YoY increase in adjusted earnings, while the wealth management and insurance business grew adjusted earnings by 18%.

Meanwhile, TD continues to invest in artificial intelligence (AI), digital banking capabilities, and customer experience while maintaining a strong Common Equity Tier 1 capital ratio of 14.3%. Combined with its long history of dividend payments, it remains an attractive option for Canadians building retirement wealth inside a TFSA.

Canadian National stock

Another stock that could help grow your TFSA over the long run is Canadian National Railway (TSX: CNR), or CN. It operates a nearly 20,000-mile rail network connecting Canada’s east and west coasts with the U.S. Midwest and Gulf Coast.

Up 29% year-to-date, the stock recently traded at $175.58 per share with a market capitalization of $107.4 billion. Investors also get an annualized dividend yield of roughly 2.1%.

During the first quarter, CN’s revenue slipped 1% YoY to $4.4 billion, while adjusted net income declined 5% to $1.1 billion as higher winter-related costs, operational incidents, and a higher effective tax rate weighed on results. Nevertheless, the business delivered record first-quarter revenue ton miles, which increased 3% YoY, while its free cash flow jumped 44% to $900 million.

CN also achieved its best first-quarter employee productivity in five years and delivered record first-quarter fuel efficiency.

With plans to invest about $2.8 billion in capital projects during 2026, this railway giant continues to strengthen its network and position itself for long-term growth.

Manulife stock

Manulife Financial (TSX: MFC) could be an attractive stock worth considering for Canadians investing for retirement. It provides insurance, wealth management, and retirement solutions across Canada, Asia, the United States, and several international markets.

With more than 20% year-to-date gains, MFC stock currently trades at about $58.67 per share, giving it a market capitalization of $97.5 billion. It currently offers an annualized dividend yield of around 3.3%.

In the March quarter, Manulife’s core earnings jumped 8% YoY on a constant exchange rate basis to $1.8 billion. Asia remained a key growth engine for the company, with the geographical segment’s core earnings rising 22% from a year ago, while the new business contractual service margin increased 15% in the region.

Moreover, the company continues expanding its presence in Asia, strengthening its global wealth management business through acquisitions and partnerships, and scaling AI across underwriting, claims processing, and distribution. Those long-term initiatives, coupled with a growing dividend, make it an appealing stock for investors aiming to build a larger TFSA retirement portfolio.

The post Canadians: Here’s the TFSA Amount You Need to Retire, Plus 3 Stocks to Get There appeared first on The Motley Fool Canada.

More reading

• 2 Dividend Stocks I’d Hold for the Next 20 Years
• BMO Says Canadians Need $1.7 Million to Retire: Your Number Could Be Very Different
• This Canadian Stock Is Down 9%: I’d Buy it for Life
• The Last 10 Years Before Retirement: What Canadians Should Focus On
• 3 Questions to Ask Before Buying a Dividend Stock

Fool contributor Jitendra Parashar has positions in Toronto-Dominion Bank. The Motley Fool recommends Canadian National Railway. The Motley Fool has a disclosure policy.