I've been trying to educate myself on dividends and am looking at investing in a local program. It shows an estimated dividend of 3%. By what I am reading this is on the low side of average?
But, I also want to reduce my taxes and this allows me a 35% non-refundable provincial income tax credit. If you designate your CEDIF as an RRSP you qualify for additional federal tax credits of approximately 30%, and Investments rolled-over (reinvested) after five years qualify for an additional 20% non-refundable provincial tax credit, if the CEDIF meets certain conditions. After ten years investments qualify for a further 10% non-refundable provincial tax credit, again, if the CEDIF meets certain conditions.
Does this sound like a good investment? Is it something you would buy? Do the tax credits make up for the lower dividend payouts?