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My CERB: Here’s a Better $2,000 Per Month Cash Than the CRA’s CERB

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The Canada Revenue Agency (CRA) is withdrawing its most popular $2,000 Canada Emergency Response Benefit (CERB) after September. The $2,000 monthly cash benefit has helped many Canadians during the COVID-19 emergency. The problem with the CERB is that it is taxable and temporary. Although the Justin Trudeau government is introducing a CERB alternative, it won’t be the same. If you are dependent on the CERB for your living expenses, you might want to check out other options.

There is a better way to get $2,000 in cash every month. This option eliminates the problems with the CERB. And the best part is, this option can give you more than $2,000 cash every month with time. So, what is this option?

A better $2,000 per month 

The CRA is giving out the CERB from a benefits pool of $82 billion. Just like the CRA, you can create a personal benefits pool in your Tax-Free Savings Account (TFSA) and give yourself a CERB.

The CRA encourages you to create your savings through the TFSA, which was launched in 2009. You put in your after-tax income in the TFSA, and any money you earn in this account is exempt from taxes. A good practice is to use your TFSA to invest in high-growth and high-dividend stocks, as they can earn you crazy money.

Generate My CERB in two simple steps

You can generate My CERB through your TFSA account in two simple steps. The first step is to make regular contributions to your TFSA. If you have been saving $5,000 annually in your TFSA since 2009 in a stock that generates 20% annual returns, you would have more than $214,000 in your by now. Open Text and CGI are some stocks that have generated average annual returns of 20% and above in the last 10 years.

The CRA’s CERB will end in September. It’s time to put the second step in action. All you have to do is cash out your TFSA investment and put it in a high-dividend stock. Companies in traditional business with stable cash flows, such as real estate, energy, and banks, pay regular dividends. The March sell-off has created a great investment opportunity in dividend stocks, as all three of those sectors were badly hit by the pandemic.

The stocks operating in the above sectors have not yet recovered to the pre-pandemic levels, which has inflated their dividend yields. Their stock price is low, as investors fear a dividend cut in the economic recession. The trick is to find the stocks that have had the least impact and have sufficient cash to pay dividends.

There is one stock that has the cash to withstand the crisis and pay dividends even during the pandemic.


North America’s largest pipeline operator Enbridge (TSX:ENB)(NYSE:ENB) has been hit by the decline in oil demand. It earns cash by transiting natural gas and oil through its pipeline and distributes this cash to shareholders through dividends. It has a 25-year history of paying regular dividends and increasing them. In the last 10 years, it has increased its dividend per share at an average annual rate of 14%.

The pandemic has closed many factories and grounded many planes, thereby reducing oil demand. Despite this, Enbridge increased its adjusted EBITDA and distributable cash flow by 3.2% and 5.5%, respectively, in the second quarter.

However, Enbridge was impacted by the pandemic, which sent its stock down 15% year to date and increased its dividend yield to 7.4%. This is a perfect opportunity to lock in a rich yield of 7.4% for the next 10-20 years.

If you put your $214,000 in Enbridge, it will give you $1,300 a month in dividend income. Considering that the company increases its dividend at an average annual rate of 8%, your monthly dividend will grow to around $2,000 by 2025.

Investor corner

Enbridge stock can give you $2,000 in My CERB payments every month for the next 10 years and more. This income will grow beyond $2,000 after 2025. As you invested in Enbridge through your TFSA, your dividend income will be exempt from taxes. This is a better $2,000 cash than the CRA’s CERB.

Want to earn another $2,000? Here are some good dividend stocks that can grow My CERB payments.

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Fool contributor Puja Tayal has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Enbridge. The Motley Fool recommends CGI GROUP INC CL A SV, Open Text, and OPEN TEXT CORP.

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