The Extra $2,000 CERB Has Been Extended: Here’s What Comes Next

With the period for CERB being extended, you might want to prepare yourself for passive income through dividend-paying stocks like Enbridge to stay afloat.

| More on:
edit Business accounting concept, Business man using calculator with computer laptop, budget and loan paper in office.

Image source: Getty Images

The Canadian government and the Canada Revenue Agency (CRA) took matters in their hands as they announced the Canada Emergency Relief Benefit (CERB) to help citizens affected by the pandemic. This emergency relief fund began to combat the loss of income due to businesses shutting down and provide Canadians with much-needed money during the crisis.

However, the plan was to provide the CERB money for up to 16 weeks.  The CERB was supposed to expire on October 3, 2020. However, Trudeau has recently announced that the CERB will be extended another eight more weeks.

But don’t just rely on the CERB in the future to get by.

Today I want to discuss how you can begin to earn income to support your expenses like CERB during this global health crisis.

Abrupt rollout

The announcement and rollout of CERB money is a confusing affair for many people. There are criteria that Canadians need to meet so they can qualify to receive the benefits. To hasten the distribution, the CRA prioritized approving CERB applications without stringently checking for eligibility.

The government trusted people not to abuse the lax approval process so they can quickly distribute the amount to those who need it the most. However, there have been cases of Canadians abusing the CERB, prompting the CRA to tighten its surveillance of individuals receiving the funds who may not be eligible.

According to recent reports, over 190,000 Canadians have come forth amid fears of repercussions for fraudulently collecting CERB money and returned at least some of the benefits they have received to the CRA.

The whole process has been confusing, and many people receiving CERB money might not know whether they qualify or not. You might want to consider reading up on why the CRA might ask for the $2,000 per month CERB back.

Life after CERB

Provincial governments are beginning to take measures to open up the economy gradually. However, it may take a long time for people to manage to make sustainable income again due to the continuing threat of the virus. While you might hope that the government decides to extend the CERB, it is not likely it can happen.

You can restore your overall income to a more manageable level if you make sound financial decisions. Even if you have a job, it would be better to secure a secondary source of income. You could look for part-time online jobs or another small gig.

You can also consider purchasing income-generating stocks, leverage capital gains, and dividends to bolster your long-term income.

Consider that you have a portfolio of $50,000 of investable money. It has to be money you can tie up in long-term investments without missing it. Invest the capital in a few high-quality stocks. Look for companies that can offer you stable income through capital gains and sustainable dividends.

If you commit to a process of reinvesting your dividends into the portfolio, between the capital appreciation, and dividend reinvestment, you can build up a portfolio substantial enough to support a sizable monthly income.

Foolish takeaway

Assets you choose to build an income-generating portfolio matter a lot. To this end, one such stock that could be excellent is Enbridge Inc. (TSX:ENB)(NYSE:ENB). ENB is the most significant oil pipeline company in North America. It has natural gas and oil pipelines, natural gas utility operations, and renewable power assets that support its income.

As well, 98% of Enbridge’s income is regulated cash flow that substantially mitigates its risk from volatile commodity prices; 95% of its customers have government or investment-grade credit ratings that further secure the company’s revenue.

While Enbridge carries substantial debt, the company continues to invest in infrastructure that will further boost its earnings.

At writing, the stock is trading for $42.25 per share and offers a dividend yield of 7.67%. Its dividends are safe due to its free cash flow generated by fixed income.

I think ENB can be an ideal stock to begin building an income-producing portfolio.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Enbridge.

More on Dividend Stocks

grow money, wealth build
Dividend Stocks

2 Ultra-High-Yielding TSX Stocks to Buy With $1,000

You don’t need thousands to start investing. Here are two super high-yielding TSX stocks to buy now that can provide…

Read more »

Business success with growing, rising charts and businessman in background
Dividend Stocks

How to Turn $15,000 Into Reliable Passive Income for Decades

If you only have $15,000 to invest today, here’s a mini portfolio that could produce passive income annually (and potentially…

Read more »

man slides
Dividend Stocks

TFSA Investors: Where to Put That New $6,500 Contribution Room

These stocks may be trading high, but they still offer value for TFSA investors seeking out the best stocks to…

Read more »

Dividend Stocks

2 TSX Companies With Dividends That Outpace Inflation

The stellar yields of these Canadian dividend stocks make them an attractive investment amid a high inflationary environment.

Read more »

Double exposure of a businessman and stairs - Business Success Concept
Dividend Stocks

1 Overlooked Dividend Stock (Yielding 5.6%) to Buy in January 2023

Great-West Lifeco Inc. (TSX:GWO) is an underrated dividend stock that warrants the attention of investors in early 2023.

Read more »

stock analysis
Dividend Stocks

1 Oversold Dividend Stock (Yielding 3.24%) to Buy in January 2023

Looking for a deal? This dividend stock is still near oversold territory, with a dividend I'd lock up right now.

Read more »

edit Business accounting concept, Business man using calculator with computer laptop, budget and loan paper in office.
Dividend Stocks

5 Top Dividend Stocks to Buy With Decades of Passive-Income Potential

Any Canadian investor can enjoy passive income from these dividend stocks that tend to increase their payouts over time!

Read more »

value for money
Dividend Stocks

3 TSX Stocks That Are Too Cheap to Ignore

You can buy cheap TSX stocks such as Suncor and Nuvei right now to enjoy outsized gains once the markets…

Read more »