Canada markets closed

3 Dividend Stocks That Could Pay You for Life

Christopher Liew, CFA
Couple relaxing on a beach in front of a sunset

Preference for dividend stocks has risen because the number of passive investors has also risen in recent years. This breed of investors does not have the time or energy to monitor their investments. But with global trade tensions permeating, there is comfort in stocks that will pay dividends for the rest of your life.

Companies that have proven track records of dividend payments are considered “dividend kings.” Although they’re not necessarily the highest dividend payers you’d love to have in your stock portfolio, the income stream is consistent and never-ending regardless of the market environment. You just sit back and receive the income.

BCE (TSX:BCE)(NYSE:BCE), Royal Bank (TSX:RY)(NYSE:RY), and Sun Life Financial (TSX:SLF)(NYSE:SLF) are preferred by passive investors and dividend-growth fanatics. The trio has the staying power and requires minimal evaluation. Their standing in the industries they operate in is unassailable.

Anchor in a stock portfolio

BCE is the largest communications company in Canada that has been in operation since 1880. This $54.7 billion telecom and media company is also the leader in a sector that has yet to be deregulated. As such, BCE dominates the telecom industry. There’s no need for a lengthy discussion to justify the intrinsic worth.

Prospective investors will surely be delighted to collect higher-than-average dividends. That’s the kind of dividend stock that can serve as an anchor in any stock portfolio. For the last five years, BCE has been doling out an average dividend yield of 4.83%. During the same period, dividend growth is 7.81%.

Never a bad investment

Just like BCE, Royal Bank of Canada is the best of the lot. From a humble regional bank when it commenced operations back in 1869, it’s now one of the most stable global banks. Royal Bank stood out during the Great Recession.

Royal Bank’s dividend streak is truly admirable. It all began in 1943 as investors witnessed increasing dividends year after year. The streak was halted in 2008, as the bank saw it fit to freeze the same to weather the financial crisis.

The payouts resumed in 2010 and have never been frozen again. Currently, the dividend yield is 4%. Net income is rising annually, and the average increase in the last three years is $825 million. A financial institution as solid and stable as Royal Bank is certainly a high-quality stock for keeps.

Insurer for generations

Another large-cap stock that’s positively a “buy-and-forget” stock is Sun Life Financial. This $31.1 billion diversified financial services company is a celebrated name in the insurance industry. The strong network of sales agents, financial intermediaries, and third-party marketing organizations brings in the business.

Sun Life belongs to the league of dividend heavyweights. Insurance stocks are commonly chosen by retirement planners and conservative investors. The 5% dividend yield is the brightest spot too. Sun Life’s insurance, wealth, and asset management solutions will live on 100 years times 100.

If you want income for the rest of your life, invest in the pillars of industries.

More reading

Fool contributor Christopher Liew has no position in any of the stocks mentioned.

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool Canada’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Motley Fool Canada 2019