Stop hoarding Cash Buy 281 shares to earn $955.40 annually in passive income


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There are likely so many Canadians who currently continue to hoard their cash rather than investing it. What’s frustrating is that many Canadians may actually have it in an investing account! Whether it’s a Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP) or anything else, why have it there if you’re not investing?

There is no good answer. Instead, stop hoarding your cash and see this market for what it is: an opportunity. In fact, it’s an opportunity to get some of the best passive income you’ve been dreaming of!

Deals on deals

Think of this downturn as a fire sale rather than a crash. Just as your favourite clothing lines might go on sale once in a while, every decade, the market also goes on sale. As the economy struggles, stocks plunge, and you can buy them for a steal.

This is especially beneficial if you want to lock in some great deals on passive-income stocks. What was once a yield at around 3% might suddenly be 5%! While the amount you get per share is the same, it costs far less to purchase those shares.

n example

Let’s look at the example of Canadian Imperial Bank of Commerce (TSX:CM). CIBC stock traded at $82.83 at its 52-week high. It now trades at just $56.49 as of writing. This means it’s certainly on sale for long-term investors.

In fact, CIBC stock is a great example of a deal you could buy today. CIBC stock is one of those TSX stocks that has been around for decades. It’s also a Dividend Aristocrat, increasing its dividend year after year for over 25 years. And it is a Big Six bank. It’s a great time to buy the stock.

Canadian banks have provisions for loan losses. Even with loan repayments down, CIBC has enough left on the side to recover to pre-fall prices within about a year. You can see this by looking to past performance.

Create massive income for life!

Now, if you want to create passive income that will last a lifetime, now is the time. CIBC stock is a great example, and I can also show you the difference in what you would get.

If you’re sitting on about $15,000, let’s see how much you could get in passive income now, as opposed to 52-week highs.

COMPANYRECENT PRICENUMBER OF SHARESDIVIDEND(ANNUAL)TOTAL PAYOUT(ANNUAL)FREQUENCYCM: 52-week highs$82.83181$3.40$615.40quarterlyCM: Today$53.39281$3.40$955.40quarterly

As you can see, you can get an additional 100 shares buying today rather than 52-week highs. Further, you get an additional $340 each year! And you get that all for the same investment — just done at a different time.

Bottom line

While timing isn’t everything, it can certainly be something when you buy during a downturn. While we haven’t entered a recession yet, CIBC stock provides a great example as to why investing when the market is down is a great option to consider. When the market recovers, and it will, you’ll be sitting on 100 extra shares (or more) that will lead you closer to your savings goals far sooner.

The post Stop Hoarding Cash! Buy 281 Shares of This Stock Instead to Get $955.40 in Annual Passive Income appeared first on The Motley Fool Canada.

Free Dividend Stock Pick: 7.9% Yield and Monthly Payments

Canada’s inflation rate has skyrocketed to 6.9%, meaning you’re effectively losing money by investing in a GIC, or worse, leaving your money in a so-called “high interest” savings account.

That’s why we’re alerting investors to a high-yield Canadian dividend stock that looks ridiculously cheap right now. Not only does it yield a whopping 7.9%, but it pays monthly!

Here’s the best part: We’re giving this dividend pick away for FREE today.

Claim your free dividend stock pick * Percentages as of 11/29/22

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More reading

2 No-Brainer Stocks I’d Buy Right Now Without Hesitation 2 Canadian Bank Stocks Unfairly Beat Up by SVB’s Collapse Passive Income: 3 Bank Stocks for TFSA Wealth 1 Undervalued Stock That Smart Investors Are Buying in 2023 3 TSX Stocks I’m Buying in Bulk During This Downturn

Fool contributor Amy Legate-Wolfe has positions in Canadian Imperial Bank Of Commerce. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

https://www.fool.ca/2023/03/21/stop-hoarding-cash-buy-281-shares-of-this-stock-instead-to-get-955-40-in-annual-passive-income/

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