Investing in the stock market can be an excellent tool for building your wealth and amassing a substantial savings pot to support your retirement. I think it has been well thought out pension plan should include a self-managing portfolio of income-oriented and reliable long-term investments.
Please note that no risk-free stocks are traded on any stock market worldwide. However, you can build a portfolio with stocks that have the best chance of generating stable passive income dividends and growth potential through long-term capital gains. My favorite sectors for such investments are banking and… utilities industries.
Today we’ll take a quick look at two high-quality Canadian stocks that can be held for the long term to help you get rich.
Fortis
Fortis Inc. (TSX:FTS) is my top pick among Canadian dividend stocks, let alone my top pick among utility stocks. The $36.5 billion market capitalization company owns and operates several natural gas and electric utilities in Canada, the U.S. and the Caribbean. Nearly all revenues come from long-term contracted assets in interest-rate regulated markets. That means the country has predictable cash flows that are virtually immune to the impact of broader economic issues.
The company can comfortably fund its capital programs and increase its dividend payments. Fortis shares have increased payouts to investors for around 52 years in a row, and it appears well positioned to continue this trend. At the time of writing, Fortis stock is trading at $72.47 per share and is paying out $0.615 per share to investors in dividends every quarter, which translates into a dividend yield of 3.4%.
Toronto Dominion Bank
Toronto Dominion Bank (TSX:TD) is one of my top picks Canadian bank stocks. Canadian banks, especially TD Bank, have faced several economic crises over the centuries and come out stronger on the other side. TD has dealt with the 2008 crash, two world wars, a pandemic and much more, but is still standing strong. All of this happened without the Bank of Canada intervening or offering a bailout to the bank.
TD Bank’s shares have a strong presence in retail banking, asset management, insurance and wholesale banking. At the time of writing, the stock is trading for $111.06 per share. The $189.6 billion market cap stock pays its investors $1.05 per share in dividends every quarter, which translates into a dividend yield of 3.8%.
The bank continues to double down on its long-term growth initiatives. Its solid capital base, consistent dividend track record and growth in domestic and international markets make it a strong candidate for a long-term position in a retirement-focused portfolio.
Silly takeaway
Fortis shares and Toronto-Dominion Bank shares are high-quality investments that are always better suited as long-term investments. Dividend track records indicate solid potential for recurring income streams and healthy total returns over the long term. By allocating part of the available contribution space to a Tax-free savings account (TFSA), you can enjoy the returns from these investments without having to pay taxes on capital gains or dividends.
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