The Canada Emergency Response Benefit (CERB) is coming to an end as of October 3, 2020. After delivering billions to Canadians needing this money during the pandemic, the federal government is now diverting funds elsewhere. Other programs have more cash to get Canadians back to work, and businesses open — whether Canadians are ready for it or not.
But if you’re one of the Canadians now anxious about the end of CERB, don’t worry. Even a little cash set aside can do wonders. That’s especially if you hold on for decades. You can bring in more cash than the $12,000 you’d be receiving from CERB, and then some. Just try out these three stocks.
One of the best buys you can make for your portfolio is bank stocks. Canadian banks fared as some of the best in the world during the last economic crisis. This time around, even before the pandemic economists predicted an economic downturn. So banks prepared well ahead of time.
While the Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM) might not be the first bank stock back to pre-crash norms, it will get there eventually. The bank is heavily invested in Canadian investments, so this lack of global diversity will slow growth. However, it will certainly get back to normal for long-term holders.
Meanwhile, the stock offers the highest dividend yield, rewarding you for your patience. The stock currently offers a 5.96% dividend yield, which is the highest of the Big Six Banks. If you wait for another crash, predicted by experts like Warren Buffett, you could receive a pre-crash discount of almost 50%!
Investors aren’t too sure about energy right now. On the one hand, you have some economists believing that oil and gas stocks will have a day in the sun once again. Even with renewable energy becoming the top choice of countries around the world, oil and gas will be the cheaper option for the next few decades at least.
So that’s why a stock like Pembina Pipeline Corp. (TSX:PPL)(NYSE:PBA) is excellent for the next few decades. The company has growth projects underway to end the glut in oil and gas. Meanwhile, it has billions set aside for further projects that should be completed in the next few years. Finally, it has long-term contracts to keep cash flowing for several decades.
Investors can then count on a solid monthly dividend yield of 7.21% as of writing for the foreseeable future. That’s along with a heck of a discount compared to pre-crash prices. If another crash happens, that discount could fall once again to a whopping 250%!
Finally, if your focus is dividends you have to look at a real estate investment trust. The best one in my opinion is RioCan REIT (TSX:REI.UN) at the moment. Rather than focusing on residences, RioCan has a focus on retail. As businesses begin opening again, RioCan stands to see a huge increase in its bottom line.
Meanwhile, investors can look forward to a dividend yield of 9.24% as of writing. Even better is that the stock is still discounted by about 87% as of writing. You don’t even have to wait for a crash to buy up this stock and see it rise in the next few years.
If you’re going to invest in these stocks, you could see huge dividends while you wait for a rebound. Let’s say you want to bring in that same $12,000 a year. That would mean putting investing a total of $166,419 into these investments, which is a lot.
However, if you’re able to put just $1,000 into each stock and waited 20 years, you would have $26,848 in dividends alone. But, even better, if you reinvested those dividends you’d have a grand total of $52,155 from a $3,000 investment.
For more great portfolio options, consider these big five.
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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 Amy Legate-Wolfe owns shares of PEMBINA PIPELINE CORPORATION. The Motley Fool recommends PEMBINA PIPELINE CORPORATION.