adplus-dvertising
Connect with us

Investment

Start Investing Now: When Can You Bid Goodbye to Your 9-to-5 Job? – The Motley Fool Canada

Published

 on


Don’t dream of bidding goodbye to your nine-to-five job. Plan it! Start investing now with a conservative dividend investing strategy. Many well-established Canadian companies pay out dividends from their profits to their shareholders. By owning shares of these companies, you can earn substantial dividend income over time.

Notably, the dividends you generate don’t necessarily have to replace your nine-to-five job’s income entirely because Canadian dividends are more favourably taxed than your job’s income.

Dividend income is taxed at a lower rate

For example, let’s say, John lives in Ontario and earns $60,000 in taxable income this year. He is subject to an average combined federal and provincial income tax of approximately $12,608 for an average tax rate of a little over 21%. In other words, John’s take-home income is about $47,392. This year, he could earn up to $55,867 in eligible Canadian dividends in his non-registered (or taxable) account without being taxed if the dividends are his only income.

Assuming John is able to earn an average yield of 4.5% from a diversified dividend portfolio today, his portfolio value would need to be about $1,053,156. It follows that the earlier you start investing, the sooner your money can work for you because you can choose from a basket of dividend stocks that increases your dividends over time. To make the compounding faster, you can reinvest your dividends to generate even more dividends.

For example, if you invest $5,000 in Bank of Nova Scotia (TSX:BNS) shares today, you would get a dividend yield of about 6.6%, or income of approximately $330, in your first year. Let’s say the share price grows by 5% per year, and you continue to invest $5,000 at the start of each year. The investment would grow to almost $66,034 in 10 years. And if it were to still yield 6.6% at the time, you would earn about $4,358 in dividend income from your position in year 10. This is just one position. Visualize other safe dividend ideas for your diversified portfolio.

Do you fancy flexible work hours?

You might also prefer to work as a part of the gig economy with flexible hours in (different kinds of) work you enjoy over a nine-to-five job. Contract work and potentially other part-time work could spice up your life and complement your dividend portfolio to make you the income you need. In this case, you can ditch your nine-to-five job sooner than if you were making income only from your dividend portfolio.

Another dividend stock idea

Other than Bank of Nova Scotia, another stock you can rely on for safe passive income is Fortis (TSX:FTS). The utility stock has increased its common stock dividend for 50 consecutive years. It is already ingrained in its DNA to maintain a safe and growing dividend.

The utility holding company is diversified across 10 regulated utilities across Canada, the United States, and the Caribbean. About 93% of its assets are for transmission and distribution of electricity or natural gas. These assets provide essential services to its customers in good and bad economic times, allowing Fortis to make highly reliable earnings throughout the economic cycle. It also maintains a sustainable payout ratio that’s about 75% of its earnings this year. At $54.36 per share at writing, FTS offers a dividend yield of 4.3%.

Adblock test (Why?)

728x90x4

Source link

Continue Reading

Investment

Tesla shares soar more than 14% as Trump win is seen boosting Elon Musk’s electric vehicle company

Published

 on

 

NEW YORK (AP) — Shares of Tesla soared Wednesday as investors bet that the electric vehicle maker and its CEO Elon Musk will benefit from Donald Trump’s return to the White House.

Tesla stands to make significant gains under a Trump administration with the threat of diminished subsidies for alternative energy and electric vehicles doing the most harm to smaller competitors. Trump’s plans for extensive tariffs on Chinese imports make it less likely that Chinese EVs will be sold in bulk in the U.S. anytime soon.

“Tesla has the scale and scope that is unmatched,” said Wedbush analyst Dan Ives, in a note to investors. “This dynamic could give Musk and Tesla a clear competitive advantage in a non-EV subsidy environment, coupled by likely higher China tariffs that would continue to push away cheaper Chinese EV players.”

Tesla shares jumped 14.8% Wednesday while shares of rival electric vehicle makers tumbled. Nio, based in Shanghai, fell 5.3%. Shares of electric truck maker Rivian dropped 8.3% and Lucid Group fell 5.3%.

Tesla dominates sales of electric vehicles in the U.S, with 48.9% in market share through the middle of 2024, according to the U.S. Energy Information Administration.

Subsidies for clean energy are part of the Inflation Reduction Act, signed into law by President Joe Biden in 2022. It included tax credits for manufacturing, along with tax credits for consumers of electric vehicles.

Musk was one of Trump’s biggest donors, spending at least $119 million mobilizing Trump’s supporters to back the Republican nominee. He also pledged to give away $1 million a day to voters signing a petition for his political action committee.

In some ways, it has been a rocky year for Tesla, with sales and profit declining through the first half of the year. Profit did rise 17.3% in the third quarter.

The U.S. opened an investigation into the company’s “Full Self-Driving” system after reports of crashes in low-visibility conditions, including one that killed a pedestrian. The investigation covers roughly 2.4 million Teslas from the 2016 through 2024 model years.

And investors sent company shares tumbling last month after Tesla unveiled its long-awaited robotaxi at a Hollywood studio Thursday night, seeing not much progress at Tesla on autonomous vehicles while other companies have been making notable progress.

Tesla began selling the software, which is called “Full Self-Driving,” nine years ago. But there are doubts about its reliability.

The stock is now showing a 16.1% gain for the year after rising the past two days.

The Canadian Press. All rights reserved.

Source link

Continue Reading

Investment

S&P/TSX composite up more than 100 points, U.S. stock markets mixed

Published

 on

 

TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.

The S&P/TSX composite index was up 103.40 points at 24,542.48.

In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.

The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.

The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.

The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.

This report by The Canadian Press was first published Oct. 16, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

Source link

Continue Reading

Economy

S&P/TSX up more than 200 points, U.S. markets also higher

Published

 on

 

TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.

The S&P/TSX composite index was up 205.86 points at 24,508.12.

In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.

The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.

The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.

The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.

This report by The Canadian Press was first published Oct. 11, 2024.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD)

The Canadian Press. All rights reserved.

Source link

Continue Reading

Trending