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Retirees: How to Boost Your CPP Pension

Cindy Dye
Happy Retirement” on a road
Happy Retirement” on a road

On average, Canadians receive $683.65 in monthly benefits from the Canada Pension Plan (CPP), while the maximum monthly benefit is currently $1,154.58. While that’s a nice start, living on less than $14,000 a year is hardly a lavish retirement.

But there’s a way you could generate thousands of extra dollars each month. It’s as simple as building a portfolio with a few of Canada’s best dividend stocks.

With an investment of $15,000, you could generate an extra $100 per month in income starting today. If you reinvest the dividends, it’s possible in a few years to have the investment generate much more.

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Here are three excellent stocks you should consider for your dividend portfolio.

Brookfield Property Partners

Brookfield Property Partners (TSX:BPY.UN)(NASDAQ:BPY) has a global real estate portfolio worth $194 billion that consists of office, retail, multifamily, industrial, hospitality, self-storage, student housing, and manufactured housing assets. Along with its real estate, the company maintains infrastructure assets including toll roads, solar and wind generators, construction companies, wastewater systems, electric transmission lines, and gas pipelines.

The company’s investment objective is to generate long-term returns on equity of 12% to 15%. Brookfield currently pays a dividend of 7.04%. This payout has increased every year since 2015.

Capital Power

Capital Power (TSX:CPX), headquartered in Edmonton, owns and operates 25 power generation facilities that have nearly 6,000 megawatts (MW) of power generation capacity. Capital Power was one of the first and leading companies to move away from fossil fuels to more environmentally friendly methods of power generation.

In 2014, Capital Power was generating 66% of its energy from coal. Over the past five years, the company has reduced that amount to only 3%. The company has shown its commitment to sustainability and has made capital investments in the advancement of carbon capture, utilization, and storage (CCUS) to support near-zero emissions from natural gas in power generation and broader industrial processes.

Capital Power pays a current dividend of 6.08%. The company has boosted the payout by approximately 7% per year since 2013 and expects to continue that growth rate going forward.

Acadian Timber

Vancouver-based Acadian Timber Corp. (TSX:ADN) is one of the leading suppliers of primary forest products in eastern Canada and the northeastern U.S. The company has approximately 2.4 million acres of land under management.

The stock came under pressure in late August when it was reported that Brookfield Asset Management had sold its 45% stake in the timberland operator to Macer Forest Holdings. Brookfield sold the stake for $128 million or $17 per share. The announcement was welcomed by some analysts hoping the shakeup might force Acadian to aggressively expand beyond its core operations, mainly located in New Brunswick and Maine.

Acadian has a current payout of 7.09% and the company has raised its annual dividend payment in each of the last three years.

The bottom line

Retirees looking to supplement their CPP pension income should consider companies that pay high dividends and have a track record of dividend increases. If you are lucky enough to have several years before you need the extra income, reinvest the dividends now. This reinvestment will allow you to earn even more each month when you are finally ready to enjoy your nest egg.

More reading

Fool contributor Cindy Dye has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends ACADIAN TIMBER CORP. The Motley Fool recommends Brookfield Property Partners LP.

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