Editors note: Advertisers are not responsible for the contents of this site including any editorials or reviews that may appear on this site. For complete and current information on any advertiser product, please visit their Web site.
A glimpse into the portfolio of young and thrifty that produces passive income like dividends and income trust distributions.

In the previous post I blabbered on about how amazing dividends are.  They really are amazing- once you start investing in them you can’t stop!  They’re like Pringles Chips.  You can’t have just one.

I didn’t realize their potential until recently, and since then, my portfolio has been lookin’ pretty fine.  I’ve recouped all of my losses since I started investing in the first place about 5 years ago (the losses are thanks to the dreaded “other investments” )(NB: the best way to learn how to invest is to do it and learn from your own experience!), and am well in the glorious green.

A few months ago, I calculated the dividend yields of all the dividend producing stocks I own.  Doing this reinforces me  NOT SELL prematurely because of the dividend yield I will get per year.  It switches my mentality from: “sell this thing and take profit” to “if it dips, then I’m picking up more”.  My goal is to be able to increase my positions on dividend yielding stock, so that I can not only reinvest it to build my portfolio further, but hopefully one day it can replace my income (or a large portion of it) and I can retire early at 35.

Wishful thinking, huh? 😉

I wrote the % return per annum and the resultant amount in $ that I would get per year with the number of stocks I own.

Without further delay, here’s a list of my annual yield from dividends (and income trust distributions):

Stock Percentage Dividend Yield Amount per Year
BCE 5.9% $176
TAC 6% $87
XDV 3.6% (but has MER) $73
CPD 5.1% (has small MER) $25
CFX.UN 28.8% (holla!!!) $288
EIF 11.6% $156
REF.UN 5.1% $36
YLO.UN 15.8% $83
LIQ.UN 10.7% $168
LUX 2.06% $55
SC 2% $46
SU 0.5% $12 (not so hot!)
FTS 4.2% $112
TOTAL:   $1317 (SWEEET!!!!)

Pizzalicious Pictures, Images and Photos

I hope to increase my positions on more dividend paying stocks and slowly increase my passive income this way. Of course, this will look a little different next year, when the Income Trusts (those with a .UN at the end) that I have in my TFSA account are going to be incorporated.

Note: The Income Trust distributions are NOT dividends- because these companies aren’t corporations- they are taxed different (and taxed  heavily) so try not to hold income trusts outside of TFSA or an RRSP or else you will be taxed to the nines.   After 2011. some of the income trust companies that I own will keep their yield, and some of the companies will have their yields slashed, but at least it will be tax efficient.

There you have it.  This list has changed slightly since I calculated it a few months ago, for example, I got rid of LUX because any dividends paid out from this is considered foreign income, hence it’s taxed at 100% my marginal rate= NOT tax efficient.

If you like dividend portfolio voyeurism (really, who doesn’t?) DividendLover.ca has a super detailed excel spreadsheet.

Readers, do you have any favourite dividend yielding equities you like?

Article comments

Evan says:

I don’t really get all the Canadian account references but I love your goal! It is VERY exciting.

young says:

@Evan- ditto for the American account references lol 🙂 Thank you! I love my goal too. Hope it comes to fruition soon. 🙂

I invested in the dividends index fund but this is a great idea for my TFSA for next year. (I don’t want to lock in my RRSP stuff)

young says:

@FB- Glad you got some good ideas out of this post!

Little House says:

My husband handles all of our stock and portfolio investments and we’ve seen some growth in a few of the companies we hold shares in. I’ll have to check out the dividend yield. However, we’re now at a point where when the stock dips low, we will try to scoop some more up. It’s nice to see a little unrealized profit!

young says:

@LIttle House- That’s definitely the mentality people need to have, so good on you! (instead of KEKEEEEKKK &%)#*)% it’s low gotta sell!)

set a dividend target. how much do you want per year by 35

young says:

@DividendLover- Great idea! Would love to retire early on passive income. That is the life!

The Rat says:

@Financial Cents:
I’m a dog for financial stocks…I even bought shares in Laurentian Bank last year. I’m hoping the big banks are going to raise their divveys in the next quarter or so.

The Rat says:

I don’t know why I spot these irrelevant things (lays & remember the tiny book we both bought?…too funny).

I think you’re absolutely right that a lot of important investment decisions are often based on one’s tax situation and income, which is why one thing makes sense for one person and not another.


young says:

@The Rat- lol I remember the little book! You have attention to detail 🙂

I have RioCan (REI.UN) through CIBC Mellon Transfer Agent for partial share purchase with DRIP. Then I have a significant portion in Just Energy (JE.UN) which is converting and maintaining its dividends. I am looking at another REIT. Honestly, I have not had the guts to buy KEG.UN, YLO.UN or LIQ.UN which are high paying dividends mostly because it feels unsustainable but yet it continues … I have focused on corporation paying 6%-8% with dividend growth.

young says:

@The Passive Income Earner- I’m planning to get JE.UN too. I might sell eithr YLO.UN or LIQ.UN for that, to keep within my TFSA and then add some positions in my REIT.

Echo says:

Also I think one of the reason YLO has been hanging around doing well is that they are aggressively moving into the online world. For example they purchased RedFlagDeals.Com earlier this year.

young says:

@Echo- I didn’t know that YLO bought RedFlagDeals- that’s a fantastic move. Thanks also for the press release re: LIQ.UN. I think I still might sell it before January rolls around and maybe buy JE.UN or acquire more REIT positions.

Echo says:

LIQ.UN announced a conversion earlier this month, along with a cut to their distribution down to $1.08/share. Here’s the link to the press release:


Echo says:

Nice list! Surprisingly we only have 3 stocks in common (BCE, FTS, and LIQ.UN). I’m a big fan of EMA right now, with their recent dividend hike. And Telus has also been a good one, raising their dividend up to $2/share earlier this year. SJR.B also has a nice monthly dividend with some upside to the stock.

I had YLO.UN but sold after their decision to incorporate and slash the dividend (in 2011), but I’m hanging on to LIQ.UN even after hearing they’ll be doing the same.

Thinking there’s a lot more sustainability in the liquor industry than the phone directory industry 🙂

young says:

@Echo- I contacted the head office of LIQ.UN and they sounded kind of iffy about whether they’ll be incorporating. That was a month or two ago and they didn’t have anything set in stone yet. Have you heard anything about that? Yeah I agree- people like to get their drink on! I’m surprised that the phone director industry has been doing well, what with the advent of google on smart phones etc.

SavingMentor says:

I’ve had XDV in my portfolio in the past but it turned out to be such a dog when compared to XIU (dividends included) that I sold it. I just didn’t see a good reason to keep it at the time with the higher MER that went with it as well.

I see it’s doing better than XIU within the past year. I wonder if that will last. Most of the previous years had XIU on top by quite a bit.

young says:

@SavingMentor- Yeah it didn’t perform that well for the majority of this year, but it is picking up. So did you end up buying XIU then?

Well done Y&T!

I pretty much love bank stocks; my favs are BNS, BMO and CM.

Would you consider any of those?

young says:

@Financial Cents- yeah, BMO is doing pretty well. I thought I would just get an ETF of them since they all looked so good I couldn’t decide on just one.

The Rat says:

Nice post.

I just love buying stocks for the long haul, especially large cap blue chip stocks that pay a juicy dividend and there is very little portfolio maintenance to do.

I don’t like selling stock unless I absolutely have to. Unfortunately, I do find myself having to do a bit more portfolio “maintenance” work with a few of my trust positions, but that’s the way it goes for the higher yield.

I can understand your position about cautioning readers and not holding trusts outside registered accounts, but I guess I’m an exception to this point of view.

I hold numerous trusts within non-registered accounts (although my wife’s TFSA has LIQ.UN). From a tax perspective, you can always offset your tax hit with built up RRSP contribution room and using it to your advantage.

Also, REITs will receive favorable tax treatment despite all the legislative changes with trusts.

I got beat up with my YLO.UN position over the past years, and that’s one that is a bit of a thorn on my side, but hopefully it will rebound from a share price point of view since my entry point.

Even though SU may not ‘be so hot’ from a dividend payout perspective, I think you’ve bought into a solid Oil & Gas sector play. If I were to buy a position in this sector anytime soon, I think it would either be SU or XOM (U.S.)

Regarding your losses, keep in mind, you can always carry forward your losses to offset any capital gains you may enjoy from sale of stock!

Great post! BTW – isn’t “can’t eat just one” for lays chips and not pringles? I’m not sure, but I like your anology how dividend investing is highly addictive and it’s fun to see not only your new worth increase over time, but also your available cash flow stream.


young says:

@The Rat- You buying the stocks for the long haul is likely why you’re so successful! 🙂 I am almost done reading the Intelligent Investor and am inspired 🙂 Yeah, it also depends on one’s income right? If the income is low and you’re getting hit with tax hits, they won’t be much of a hit considering if your marginal tax bracket is on the low side. Yup, I forgot to mention that REITS won’t be affected with the legislative changes. I could sell my YLO.UN and a few other ones that are taking a huge slashing and load up on some REITS.

LOL is it Lays?? I thought it was Pringles. I like Pringles more than Lays, so perhaps I am biased 🙂

Tony says:

I bought some of the income trusts you listed about a month ago — they are all up over 10% right now and I have not even received my first dividend.

It is really hard to hold out and not take the short term gain, but logic always keeps me on the long term train.

Next stock market dip will hopefully take place early 2011 — So I can buy more with my TFSA dollars.

young says:

@Tony- Yay! I love the distributions from income trusts… too bad the fun’s ending soon 🙁 I know what you mean- hard to hold out and not take the short term gain. Though I think I might sell some of my income trusts before January.. I have a feeling other people might be doing the same due to the dividend slashing.

Well Done!

How are you monitoring your income trust? January 1st is 2 months away. I have stayed away from Yellow Pages due to different comments regarding their future but they continuously keep paying huge dividends. It feels unsustainable …

young says:

@The Passive Income Earner- Yeah, they are going to slash their dividends come January. I think what I’m planning to do is sell within these two months and wait to see what happens come January or February. Do you have any income trusts?