RRSP Investors: Here’s Where I’d Invest the Next $5,000 in 2026

One of the biggest advantages of investing through a Registered Retirement Savings Plan (RRSP) is tax deferral. Any income or capital gains earned inside the account aren’t taxed until withdrawal — ideally in retirement, when your marginal tax rate is expected to be lower. This makes the RRSP the ideal place to focus on maximizing total long-term returns, rather than worrying about near-term taxes.

Another overlooked benefit is that U.S. dividends earned in an RRSP are generally exempt from the 15% U.S. withholding tax. That opens the door to high-quality U.S. dividend stocks — provided investors remain mindful of foreign exchange risk, especially when the U.S. dollar is elevated relative to the Canadian dollar.

With those advantages in mind, if I were deploying an additional $5,000 into my RRSP in 2026, I’d consider stocks like these.

A Canadian core holding built for compounding

Intact Financial (TSX:IFC) would be one of my top Canadian picks. As Canada’s largest property and casualty insurer, Intact provides essential coverage across auto, home, and commercial lines. Beyond Canada, it has grown into a global specialty insurance leader, with strong positions in the U.K. and Ireland following its RSA acquisition.

What makes Intact especially compelling for RRSP investors is consistency. The company is known for disciplined underwriting, strong capitalization, and industry-leading risk management. Over time, that has translated into industry-beating returns on equity and reliable earnings growth.

Those fundamentals support one of the strongest dividend growth records on the TSX. Intact has increased its dividend for two decades, with a long-term growth rate of roughly 11%. At around $262 per share at the time of writing, the stock yields about 2% and trades roughly 18% below the average analyst price target, suggesting potential upside of more than 20% if sentiment improves.

Adding U.S. consumer stability without currency headaches

Canada’s stock market is light on true consumer staple giants, which is why I’d complement Intact with exposure to a U.S. blue chip like PepsiCo (NASDAQ:PEP). Pepsi is one of the world’s largest food and beverage companies, selling iconic brands such as Pepsi, Gatorade, Lay’s, Doritos, Quaker, and Cap’n Crunch across more than 200 countries.

The appeal here is resilience. Even during economic slowdowns, consumers continue to buy snacks and beverages, helping stabilize earnings and cash flows. Pepsi currently offers a dividend yield close to 3.9%, backed by durable cash flows and a long history of annual dividend increases.

While near-term earnings growth expectations have moderated, the stock trades about 20% below its long-term average valuation. That creates an attractive setup for income-focused RRSP investors who can afford to be patient.

Canadian investors can also access Pepsi through Canadian Depositary Receipts (CDRs) on the NEO Exchange, allowing purchases in Canadian dollars with built-in currency hedging and no conversion fees — a simple way to reduce foreign exchange risk inside an RRSP.

Investor takeaway

In 2026, RRSP investors can consider allocating the next $5,000 toward high-quality, cash-generating businesses that compound reliably over time. Intact Financial provides Canadian financial strength and consistent dividend growth, while Pepsi adds global consumer stability and attractive income. Together, they offer diversification, resilience, and long-term return potential well-suited for a tax-deferred retirement portfolio.

The post RRSP Investors: Here’s Where I’d Invest the Next $5,000 in 2026 appeared first on The Motley Fool Canada.

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More reading

• RRSP: 2 TSX Stocks With Decades of Dividend Growth
• 2 TSX Giants to Buy for the Next 20 Years
• 3 Canadian Stocks That Are the Best to Buy and Hold in a TFSA
• 4 Dividend Stocks to Double Up On Right Now
• Retirees, Take Note: A January 2026 Portfolio Built to Top Up CPP and OAS

Fool contributor Kay Ng has positions in Intact Financial and PepsiCo. The Motley Fool recommends Intact Financial. The Motley Fool has a disclosure policy.