My Dividends

Welcome to my Dividends page.

This blog is about saving and investing my way beyond a $1 million portfolio and we use dividend paying stocks to help fund our semi-retirement plan. 

I believe owning dividend paying stocks can help your portfolio too.

Millennial Investing


Financial Independence Articles 

Here are some selected articles that relate to realizing our financial independence goal via dividends:

This is my comprehensive Financial Independence Plan.

Why you need to stay invested regardless of what the market is doing

I prefer Financial Independence Work On Own Terms #FIWOOT

Why my goal to live off dividends remains alive and well.

Can you have too much income from dividends?  (Heck no.)

Why dividend investing works for me – period.

How should I invest in a taxable account?  My RRSP and TFSA are now full!

I’ve maxed out my RRSP and TFSA. Now what? (How to invest now?)

This is how I get U.S. income from my Canadian dividend paying stocks.

This is how I built my Canadian dividend portfolio – and how you can too!


Q&A with Mark: What is your dividend income goal?

I update this chart at the end of every calendar year.

Now updated for 2023!

MOA Dividend Income Target 2023


You’ll see the chart eventually stops in another year or so…


That’s because in 2024 we believe surpassing our goal of earning just over $30,000 per year in dividend income inside our tax-free (thanks TFSA) and tax-efficient (taxable) accounts will cover most of our basic living expenses for life.

Your mileage may vary. 

More about that target in a bit…


Q&A with Mark: Why just focus on $30,000 per year?

Here are some examples of what we believe this income could cover in current years’ dollars – most of our basic living expenses. You’ll see we focus on the big 3: food, housing and transportation.

I figure if you get those decisions in life right – you’re way ahead in the financial independence game. 

Key expensesCurrently MonthlyCurrent AnnuallySemi-retirement comments ~ end of 2024
Mortgage$2,240$26,880We anticipate the mortgage “dead” before the end of 2024.
Groceries/food$800$9,600Although can vary month-to-month!
Home maintenance/expenses$700$8,400Represents 1% home value per year, increasing by 3% inflation.
Home property taxes$500$6,000Ottawa is not cheap, increasing by inflation.
Home utilities + internet/TV/cell phones, subscriptions, etc.$400$4,800 
Transportation – x1 car (gas, maintenance, licensing)$150$1,800May or may not own a car long-term!
Insurance, including term life$250$3,000Term life ends in 2030, will self-insure after that without life insurance.
Totals with Mortgage$5,140$61,680 
Totals without Mortgage$2,900$34,800As you can see, once the debt is gone, we’ll be in a much better place for financial independence!

Add in other spending/miscellaneous spending to the tune of $1,000 per month and that’s our budget:

semi-retire to spend about $4,000-$4,500 per month without any travel or major capital expenses.  

We believe earning close to $30,000 per year, from part of our portfolio, excluding RRSPs/RRIFs, ignoring workplace pensions, not including future government benefits like CPP and OAS should be “enough” to start part-time work. 


Q&A with Mark: Why do companies pay dividends?

When a corporation declares a dividend, the company’s retained earnings decrease and its current liabilities increase. When the cash dividend is paid, the corporation’s cash account decreases.  Dividend payments directly reduce a company’s earnings, so usually stable, well-established companies tend to make regular dividend payments. You really can’t fake them for every long!

Companies use dividends to pass on their profits directly to shareholders. They certainly don’t have to but many companies do. A few reasons come to mind for me:

  • Reason #1 – it is core to company strategy. Potentially there are no current companies to acquire, maybe company debt is under control, and/or there is already a healthy stream of cash to begin funding new company products or services. Thus, as part of company strategy to reward shareholders – the board of directors feels it’s simply one of the best things to do with company profits over time.
  • Reason #2 – the company is on sound financial ground. Most companies that pay a dividend, especially long-term (as in decades) have a stable business model. You really can’t fake dividend payments for very long. Companies that grow their dividend tend to have great cash flow – profits. As an investor, it’s to your advantage to own shares in a company that makes large profits, consistently, with time. A reliable dividend is essentially one very good sign of business strength. This is because unstable companies cannot divert profits directly to shareholders for very long.
  • Reason #3 – they want to attract investors. This is akin to company strategy. Some investors are more speculative and like risks (note: this is not me). Dividend-paying companies can attract a certain type of investor; one who prefers cash in hand versus the hope of capital gains. Such investors like the idea of earning income from their investments the same way people go to work to earn an income – it’s dependable. Over time the work is performed by their portfolio. The portfolio will pay out MORE income over time if you reinvest dividends and/or you hold such dividend paying companies long enough whereby dividends are increased by the company every year or so.  Companies know there are investors out there who put a bias on income generated from their portfolio over growth.
  • Reason #4 – companies know investors like optionality. You see, in a perfect world, all businesses would allocate capital in a way to perfectly maximize the return on that capital. This would be done so reinvested money would go back into the business in way that pays off immensely for the shareholder (by increasing returns over time AND by continually reducing the company’s tax burden). But you should know by now we don’t live in a perfect world. This means shareholders have over time demanded a dividend – for the purposes of “optionality”. Shareholders like optionality – and dividends provide that optionality – to give investors the choice to increase or decrease their exposure to the business. Reinvested dividends therefore, take advantage of that optionality, to increase exposure.  Dividends taken as cash, do not.

Dividends (and distributions) are therefore one very important part of an investor’s total return. 

Honest Math - Dividends


An investor could technically create their own dividend (income stream) by timing the sale of their stock shares. This may or may not appeal to some investors. Ultimately total return matters. 

Dividend Slide


Q&A with Mark: Why do you love dividends so much?

A few reasons come to mind…

  1. Income just happens. My portfolio just works for me.  
  2. This approach helps me psychologically regardless of what the stock market does including 10% or 20% or 30% declines (including the 2022 stock market year!)
  3. I can reinvest the dividends and distributions paid (which I do) to buy more shares commission-free.
  4. I save money on fund management fees. I own many of the same stocks the big funds own – and pay no management fee to do so! No financial advisor needed!
  5. Canadian dividends are farily tax-efficient in a non-registered account. This makes this taxable account a great home for Canadian stocks. I will use my RRSP to hold mostly U.S. assets including some low-cost ETFs. 
  6. “Living off dividends” to some degree can help reduce any income worries about when to sell shares during any market downturn of 20% or 30%. I can simply take the dividends and distributions as cash for expenses. 
  7. Earning dividends is a great complement to my buy and hold approach using ETFs for long-term growth. You can read about my favourite, best, low-cost ETFs to ride market returns here.


Q&A with Mark: can you really live on $30,000 per year? 


Being honest. See the chart above. I already know our needs and wants will exceed $30,000 per year.

Thankfully, we’ll have more assets to spend and we’ll eventually draw down our capital too. 

We figure the sum of $30,000 from our portfolio + working part-time should deliver about $50,000 or more per year in income.

That’s a very good base for us in semi-retirement.

We’ll work part-time to keep our bodies and minds active. We want to be contributors to society. We want to help others. This means I don’t believe in “retire early” mantras. Instead, I strongly believe in Financial Independence, Working On Own Terms. #FIWOOT.

So our semi-retirement income plans could look like this in our 50s before any workplace pensions are activated and before any government benefits kick-in later on in life:

  • Earn about $30,000 per year in dividend income.
  • Work part-time at least $20,000 per year. 
  • As needed, withdraw $20,000 or so per year from our RRSPs starting in our 50s.


$70,000 or so per year.

To sum up, “living off dividends” + part-time work + slow RRSP withdrawals should add up to about $70,000 per year in income starting in our 50s.

We think that’s a great income goal to start semi-retirement with that again excludes any workplace pension income and ignores any future government benefits like CPP and OAS.

Why my goal to live off dividends remains alive and well


Q&A with Mark: What about your government benefits?

We’ll take Canada Pension Plan (CPP) and/or Old Age Security (OAS) at likely age 65 or later once those RRSP assets are nearly gone.

Here are some reasons why you should consider deferring CPP and OAS payments.  


Q&A with Mark: What Canadian stocks do you own?

As part of my hybrid investing approach, we own a number of Canadian dividend paying stocks for rising dividend income and growth.

At the time of this page update, we own almost 30 different Canadian stocks between our two (x2) non-registered accounts and our two (x2) Tax Free Savings Accounts (TFSAs).

We own these stocks because we believe buying and holding our DIY bundle of Canadian dividend-paying stocks will, over time, provide some steady monthly income for future wants and needs in retirement.

I own most of the stocks many of the big Canadian ETFs own.

I use low-cost ETF XIU to skim the index and have done so for many, many years now:

XIU December 31, 2020

I own many of the same stocks XIU holds and have done so for many years.

I like owning “TULF” stocks. What are “TULF” stocks???

  • T” = Telecommunication companies.
  • U” = Utilities.
  • L” = Low-yielding dividend growth stocks with growth potential.
  • F” = Financials.

Buy these companies over time, over months, over years, over decades.

Eventually, the portfolio will do all the income and returns work for you! 

Examples of what I own:

  • “T” for Telecommunications companies (Telus (T) and Bell Canada (BCE)).
  • “U” for Utilities (Fortis (FTS), Emera (EMA), Capital Power (CPX)).
  • “L” for Lower-Yielding companies (Canadian National Railway (CNR), Waste Connections (WCN)).
  • “F” for Financials (Royal Bank (RY), TD Bank (TD)).

Basically, I buy companies that people need.

People borrow money and want to buy houses, so I own banks like Royal Bank.

People need insurance, so I own insurance companies like Sun Life. 

Last time I checked, people want to heat and cook in their home(s), so I own companies like Enbridge. 

People love their internet and cell phones, so I own Telus. 

I think you get the idea by now…!


Q&A with Mark: What U.S. stocks do you own?

As part of my hybrid investing approach, we also own other assets, beyond Canadian dividend paying stocks. 

In recent years I’ve gravitated to owning more low-cost ETFs in my portfolio although I continue to own a few U.S. stocks, examples include:

  • Johnson & Johnson (JNJ)
  • Procter & Gamble (PG)
  • BlackRock (BLK).


Q&A with Mark: What is your Asset Location?

I/we own mostly Canadian dividend paying stocks inside our taxable accounts and inside our Tax Free Savings Accounts (TFSAs).  Why?

Canadian dividend-paying stocks receive favourable tax treatment from our government. These stocks are eligible for the Canadian dividend tax credit if held in a taxable account (meaning, outside TFSA and RRSP accounts). We own Canadian stocks for income and growth. 

I/we own mostly U.S. dividend paying stocks and ETFs in our RRSPs. Why?

Like I wrote above, I hold a few U.S. blue-chip stocks for U.S. dollar income and long-term growth. Unfortunately U.S-dividend paying stocks do not receive any favourable tax treatment from our Canadian government.  I keep U.S. stocks inside an RRSP to avoid paying any withholding taxes (15%). On that note, some considerations for you and how I personally invest:

  • U.S. stocks held within RRSP or LIRA or RRIF = no withholding taxes.
  • U.S. stocks held within RESP or TFSA = pay 15% withholding taxes. (I don’t do that.)
  • U.S. stocks held unregistered accounts = pay 15% withholding taxes (which is recoverable at time of tax filing).

When you hold U.S. stocks in a taxable account:

  • There is 15% U.S. withholding tax off the top AND
  • because U.S. dividends don’t qualify for the Canadian dividend tax credit, you’ll pay tax at your marginal rate on the full amount of the dividend.  U.S. dividends held in a non-registered account are taxed like interest income.  So, if you’re going to hold any U.S. assets in a taxable account – hold stocks that pay no dividend and very little dividends or distributions.  Thankfully, for U.S. stocks in non-registered accounts, you get a credit for the amount withheld when you file your tax return.  This credit can be applied against Canadian income taxes so in most cases that leaves you square—providing your Canadian tax rate is at least 15%.

If you want to learn how to switch Canadian $$$ to U.S. $$$ for less – learn about Norbert’s Gambit here.

I/we own Canadian REITs in either our TFSAs or RRSPs. Why?

Real Estate Investment Trusts (REITs) are companies that invest in real estate assets and distribute their income (primarily from rent) to shareholders, usually in the form of dividends, return of capital, and income. While it depends on the REIT, if the REIT distributes a portion of their income as return of capital, interest, capital gains or dividends, each portion will be taxed accordingly. 

Keeping REITs inside a TFSA or RRSP avoids this tax complication.


Other Asset Location Articles!

Check out this article about taxable investing and what to hold where.

You can get U.S. income from British ADRs tax-free using this method.

Here is how to get U.S. dollars from Canadian dividend paying stocks.


Looking for more dividend inspiration?

For years, I’ve been inspired by one of Canada’s oldest and most trusted dividend investing sites, Million Dollar Journey. Check out that resource for the best dividend stocks to own and how dividend investing can be part of your get wealth eventually strategy like mine.

Thanks for visiting and make sure you subscribe to my site for free newsletter content every week!