Retirement Portfolio

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Hello,

My parents are in their 60s, and recently retired.
My dad is transferring his RRSP from Sunlife into a cash account.
He wants to start buying dividend-paying stocks and living off of the dividends.
I have talked about the positives about dividend investing; but, I’m in my early-30s and their goals are obviously different from my goals.
I’d love to hear your thoughts about what a couple, at the start of their retirement, should do if they want to start a retirement portfolio.
Are dividends the way to go?

What are your thoughts?

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Asked on September 16, 2021 5:10 pm
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Private answer

Hey there,

Very tough question to answer because everyone will be very different. It'll depend on their entire financial situation, tax profile, risk tolerance, etc.

That being said, that is a goal for many - including myself. Build a portfolio of income generating stocks and generate enough income to either live off of, or cover the majority of your expenses. So it is very much a common goal among retirees. It is likely that they will focus moreso on foundational stocks with stable and reliable dividends. Most also look for a higher than average yield as lower yield stocks may not generate enough income for them. As they will be in their retirement, capital preservation and dividend income will be top priorities so finding a blend of safe dividend with some capital appreciation is ideal.

For me, when i built my dividend growth portfolio i bought with the intention of holding well into my retirement and that will require little maintenance -this stocks like FTS, the Big 6 banks, etc. Strong stocks, offering nice and safe yields.

Hope that helps - may not answer your question exactly but we can't possibly give individual advice in their situation since there are many, many factors at play.

Mat

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Posted by Mathieu Litalien
Answered on September 18, 2021 8:16 am