The Canadian government just announced a great news for us Canadian dividend growth investors! The maximal contribution in our tax free saving account has been raised to 10,000$ per year, almost the double of what it previously was! Cool!
This account will permit me to let my dividend income compound tax free and I will also be able to spend that income without paying income tax on it in this not so distant future of my early retirement!
Speaking about early retirement I feel very anxious about buying dividend growth stocks. For a ton of reasons, I haven’t bought any since february. I feel bad about it because the future me and my early retirement project is suffering from this “break”. But I should be able to buy stocks pretty soon. I’m still awaiting for my tax return check and my job bonus… It should be in my account pretty soon… but then I’ll need to wait for the inter-institution transfer that can take anywhere from 10 days to 6 weeks. I’ll then have approximately 10,000$ to invest!
I’ll buy dividend growth stocks for sure! But which ones? I’ll have approximately 5-6000$ US to invest after paying the exchange rate and 3000$ CAN.
To be honest… I didn’t really checked the stock market recently so I don’t know where the value is right now. It’s going to be a lot of fun to dig around and update my dividend growth stocks screener database too.
I might also take the time to think about 2 laggards that I still own : Mattel and ARCP. Should I sell them? I would take a loss and since the stocks are owned in my RRSP I won’t be able to write this loss off in my tax report next year… Or should I still wait and see?
ARCP has cut the dividend and even though they were supposed to reestablish it… well they did not yet! So does it still has a place in my portfolio? I don’t think so. I was waiting for an opportunity (an interesting news moving the stock up) to sell my shares but these news are unpredictable and pretty scarce recently.
And for Mattel… It seems that the signs were there. I thought that I had made a good deal when I bought it at 35$ after its huge drop from 48$ per share and I was comforted in my decision when I saw it bounce back to 40-42$ for a while… until I saw it sank even more in the 23$ territories. The huge storm seems to have passed and maybe more calm waters are ahead but who knows? For now, the 0.38$ dividend per share per quarter has been maintained for the 5th consecutive quarter. No dividend cut, but no raise either… The dividend is stalled but if Mattel doesn’t find ways to pump in more cash flow, there might be a dividend cut… Should I take the risk? Mattel is very well anchored in our collective consciousness but is it enough?
I don’t have a lot of cash invested in those two stocks but I know that my hard-earned money could work more efficiently somewhere else. There are so many better stocks out there… So I might take a decision pretty soon about those.
Keep the investors investing!