Canada markets closed
  • S&P/TSX

    +15.69 (+0.08%)
  • S&P 500

    +0.57 (+0.01%)
  • DOW

    +8.77 (+0.03%)

    -0.0009 (-0.12%)

    +0.49 (+0.44%)

    -1,492.58 (-3.82%)
  • CMC Crypto 200

    -23.03 (-3.42%)

    +3.90 (+0.21%)
  • RUSSELL 2000

    -2.96 (-0.17%)
  • 10-Yr Bond

    -0.0680 (-2.38%)

    -33.88 (-0.30%)

    +0.08 (+0.27%)
  • FTSE

    +87.24 (+1.19%)
  • NIKKEI 225

    +336.19 (+1.27%)

    +0.0007 (+0.10%)

Retirement Planning: 3 RRSP Stocks for Hands-Off Wealth Building

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
Retirement plan
Retirement plan

Written by Adam Othman at The Motley Fool Canada

The sooner you start building your retirement portfolio, the more time you have to grow it to an adequate size. But more time for growing your portfolio doesn’t mean you have to spend more time working on your portfolio. With the right long-term holdings in your RRSP growing at a steady pace, you can take an almost hands-off approach to investing.

A banking stock

Toronto-Dominion (TSX:TD)(NYSE:TD), even though it’s the second-largest Canadian bank by market cap, gets the top spot in several areas. It caters to a much larger customer base and has a significant U.S. presence. It’s also making great strides in the digital banking arena and might emerge as the top digital bank (among the Big Five) in Canada.

But it doesn’t just offer a powerful position in the sector. TD’s strength as a long-term holding comes from both its growth potential and dividends. As an aristocrat, the bank has been growing its payouts for a decade. It offers safety and financial stability that’s characteristic to the Canadian banks. And its 10-year CAGR of 14.4%, though not top of the line, is quite sustainable.

However, the current number should be taken with a grain of salt, as it was skewed by the bullish post-pandemic recovery run.

A utility company

Utilities like Hydro One (TSX:H) are usually considered safe long-term holdings by default, thanks to the secure, evergreen revenue sources: consumer billing. The company caters specifically to Ontario citizens and is one of the largest utility companies in the province. It serves about 1.4 million customers, mostly in rural areas, which might require more investment in infrastructure but also has the edge of low competition.

The company has two assets and revenue streams (transmission and distribution). Both have their own growth opportunities and offer financial stability in different ways. The stock itself offers a good combination of dividends and capital-appreciation potential. The current yield is 3.3%, and the five-year CAGR is 9.6%.

An asset management company

Brookfield Asset Management (TSX:BAM.A)(NYSE:BAM) is one of the largest asset management companies in Canada and one of the largest alternative investment asset managers in the world. The company has a long and proud history and an impressive global presence. With over $650 billion worth of assets under management in 30 countries, Brookfield comes with a lot of diversification by default.

It focuses on real estate, renewables, and infrastructure assets (among others). Even though Brookfield pays dividends as well, its below 1% yield might not be a good enough reason to hold the company in your RRSP or your TFSA. However, the 10-year CAGR of 20.7% makes it a powerful holding, even at its current, slightly overvalued price.

Foolish takeaway

The three stocks can contribute a lot to your retirement wealth-building, whether you put it in your RRSP or your TFSA. Even though none of them offer rapid growth, the sustainability and capital-preservation potential they offer might be the ideal mix you need for the long-term, hands-off building of your nest egg.

The post Retirement Planning: 3 RRSP Stocks for Hands-Off Wealth Building appeared first on The Motley Fool Canada.

Should You Invest $1,000 In Brookfield Asset Management?

Before you consider Brookfield Asset Management, we think you’ll want to hear this.

Our S&P/TSX market doubling* Stock Advisor Canada team just released their top 10 starter stocks for 2022 that we believe could supercharge any portfolio.

Want to see if Brookfield Asset Management made our list? Get started with Stock Advisor Canada today to receive all 10 of our starter stocks, a fully stocked treasure trove of industry reports, two brand-new stock recommendations every month, and much more.

Click Here to Learn More About Stock Advisor Canada Today

More reading

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool recommends Brookfield Asset Management Inc. CL.A LV.


Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting