I’ve spent a few years dithering about what to do with my RRSP, but since my income has increased over that time I can no longer ignore the tax advantages of making RRSP contributions.
After only contributing $1,500 to my RRSP in 2011, I’ve added $5,000 in 2012 and another $5,100 during the first 60 days of this year. I’ve also budgeted to make another $10,000 in RRSP contributions during the remainder of 2013.
Related: RRSP Portfolio Update 2012
Here’s what I’ve done with my cash over the last 12 months.
- Bought 200 shares of Rogers Sugar on August 23rd, 2012
- Bought 250 shares of Rogers Sugar on November 30th, 2012
- Bought 100 shares of SNC-Lavalin on November 30th, 2012
- Bought 60 shares of Empire on January 10th, 2013
- Bought 30 shares of BMO on February 20th, 2013
I like to buy blue-chip companies that tend to increase their dividends on a regular basis. I believe these types of companies will deliver the highest returns over a long period of time.
RRSP Portfolio
Here’s a look at my RRSP portfolio as of March 22nd, 2013:
Symbol | Shares | Market Value | Book Price | Current Price | Dividend |
BMO |
90 |
$5,743.80 |
$55.95 |
$63.82 |
2.96 |
BNS |
45 |
$2,674.35 |
$42.64 |
$59.43 |
2.40 |
BCE |
80 |
$3,736.80 |
$24.52 |
$46.71 |
2.33 |
CM |
32 |
$2,602.24 |
$60.29 |
$81.32 |
3.76 |
COS |
140 |
$2,977.80 |
$20.71 |
$21.27 |
1.40 |
EMP |
60 |
$3,891.00 |
$59.07 |
$64.85 |
0.93 |
FTS |
100 |
$3,370.00 |
$29.28 |
$33.70 |
1.24 |
GWO |
150 |
$4,075.50 |
$26.33 |
$27.17 |
1.23 |
LIQ |
160 |
$2,964.80 |
$11.61 |
$18.53 |
1.08 |
REI.UN |
130 |
$3,537.30 |
$12.88 |
$27.21 |
1.41 |
RSI |
450 |
$2,857.50 |
$6.23 |
$6.35 |
0.36 |
SNC |
100 |
$4,219.00 |
$39.39 |
$42.19 |
0.88 |
SJR.B |
100 |
$2,484.00 |
$20.38 |
$24.84 |
1.02 |
T |
85 |
$5,918.55 |
$31.74 |
$69.63 |
2.56 |
TRP |
60 |
$2,974.20 |
$37.91 |
$49.57 |
1.84 |
CASH |
$8,412.45 |
||||
Total |
$62,439.29 |
This portfolio currently generates $2,278 in annual dividends. Only two of the 15 stocks failed to increase their dividend in the last 12 months (LIQ, GWO). Rogers Sugar paid out a special dividend of 36 cents per share earlier this year.
What To Buy?
I’m trying out a simple stock screener to find Graham-like Canadian dividend stocks to add to my watch list, but nothing has matched the criteria so far:
- Positive P/E Ratio less than 15
- Positive P/Book Ratio less than 1.5
- Dividend Yield more than 0%
- 1-Year Revenue more than $500 Million
- 5-year dividend growth rate more than 5%
- Dividend coverage between 5-95%
I’ve got a fair bit of cash sitting in my RRSP account so hopefully the market pulls back a bit so I don’t have to buy in at such a high value.
Related: The Pitfalls of Chasing the Highest Dividend Yield
What stocks are on your watch list right now?