Young Canadians are searching for ways to set aside ample funds to support a comfortable retirement.
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This wasn’t always an issue, but the employment world has changed considerably in the past 15 or 20 years, and new graduates can no longer assume they will immediately find a full-time job with juicy benefits.
Contract work is more common, and when a full-time gig finally comes around, the pension benefits, if any, can vary significantly.
As a result, many young people are forced to take their retirement planning into their own hands.
One popular strategy involves buying dividend stocks inside a TFSA and investing the distributions in new shares. This sets off a powerful compounding process that can turn a modest initial investment into a sizeable nest egg over time.
Let’s take a look at Fortis Inc.(TSX:FTS)(NYSE:FTS) and Toronto-Dominion Bank (TSX:TD)(NYSE:TD) to see why they might be interesting picks.
Fortis owns natural gas distribution, power generation, and electric transmission assets in Canada, the United States, and the Caribbean.
The company has grown significantly in the United States in recent years, including the US$4.5 billion purchase of Arizona-based UNS Energy in 2014, and last year’s US$11.3 billion acquisition of ITC Holdings.
The new assets are performing as expected, and shareholders are reaping the benefits.
Fortis plans to raise the