bond portfolio:
(these are the actual yields from the bond desk available via TD Waterhouse discount brokerage)

1. $40 000 invested in :
John Deere, due OCT 2010. current yield: 3.32902%

2. $40 000 invested in :
Wells Fargo, due FEB 2011. current yield: 4.93884%

3. $40 000 invested in :
John Hancock, due NOV 2011. current yield: 4.88717%

4. $40 000 invested in :
General Electric, due AUG 2012. current yield: 5.81205%

5. $40 000 invested in :
Bank of Montreal, due MAR 2013. current yield: 3.08474%

6. $40 000 invested in :
Molson Coors, due SEP 2014. current yield: 5.50514%

7. $40 000 invested in :
Wells Fargo, due JUNE 2015. current yield: 6.54449%

8. $40 000 invested in :
Shaw Cable, due March 2016. current yield: 6.63298%

the total investment is $320 000. this would leave you with $80 000 in whatever for you choose to keep in hard currency, for a rainy day in a PC Financial no cost, high interest savings account, whatever.
the earnings break down like this, pre-tax each year :
1. $1331.60
2. $1975.54
3. $1954.87
4. $2324.82
5. $1233.90
6. $2202.06
7. $2617.80
8. $2653.19

this is a total of $ 16293.78 in coupon payments every year.
if this was your investment portfolio as a pensioner, with no mortgage or outstanding debts, if this was your only source of income it would be taxed at about 9% or about $1500. leaving you with about $15 000 of after-tax profit to you. you can purchase new bonds, at higher yields whenever a bond comes due and your principal can be protected against inflation. plus your $80 000 in cash that can get you out of trouble no matter what.

the typical stock and bond portfolio?

many advisors will give clients a portfolio with too many stocks and therefore too much risk. however, here is a common list of some dividend paying stocks to be combined with the more conventional bond portfolio which is designed to balance the risks associated with purchasing stocks. the asset mix is approximately 40% stock, 35% bonds, 25% cash - considered a conservative but typical formula given by advisors.

stocks

1. $20 000 invested in
Pengrowth Energy Trust (TSE: PGF.UN)
current price: $7.10 current dividend per share: $2.50 %yield= 35%

2. $20 000 invested in
Royal bank (TSE: RY)
current price: $36.78 current dividend per share: $2.00 %yield= 5.4377%

3. $20 000 invested in
Enbridge (TSE: ENB)
current price: $36.35 current divdend per share: $1.48 %yield= 4.9587%

4. $20 000 invested in
Imperial Oil (TSE: IMO)
current price: $45.80 current dividend per share: $0.9523 %yield= 2.07925%

5. $20 000 invested in
Manulife Financial Group (TSE: MFC)
current price: $14.20 current dividend per share: $1.00 %yield= 7.04225%

6. $20 000 invested in
Cineplex Galaxy Income Fund (TSE: CGX.UN)
current price: $14.13 current dividend per share: $1.26 %yield= 8.91719%

7. $20 000 invested in
Encana Corp. (TSE: ECA)
current price: $51.60 current dividend per share: $1.60 % yield= 3.10078%

8. $20 000 invested in
Rogers Communications (TSE: RCI.B)
current price: $31.00 current dividend per share: $1.00 % yield= 3.2258%


bonds
1. $20 000 invested in
Government of Canada bond,
due JUNE 2013. current yield= 1.46247%

2. $50 000 invested in
Province of Ontario bond,
due MARCH 2016. current yield= 3.26047%

3. $75 000 invested in
Government of canada bond,
due JUNE 2033. curren yield= 3.6028%

total investment is $305 000, leaving you with $95 000 in an emergency fund, or to make investments when prices are attractive, etc. the yield, pre tax, works like this

for stocks
1. $7040
2. $1086
3. $814
4. $415.20
5. $1408.45
6. $1790
7. $619.2
8. $645

for bonds
1. $292.49
2. $1630.23
3. $2702.10

total income from investment pre-tax= $18442.67
if you were to have no job and rely solely on this income your total tax would be approximately $300 dollars, meaning you take home about $18 000 after tax.

my analysis and discussion will follow.