The pandemic looks like it’s here to stay at least a little longer. While a vaccine is starting to become available, it will likely be a long time before the public can receive it. Meanwhile, Canadians have seen COVID-19 cases rise to heights never seen before. All this happened before the holidays, and it’s likely we’ll hear any day now how bad it’s going to become.
That means you’re going to need to do two things. The first is prepare for a market crash. This could be an opportunity rather than a curse! You can find stocks on the cheap that you can hold for decades. All you have to find are the right ones to invest in.
If you want stocks that will serve you now and in the future, dividends stocks are a great option. You could see huge returns by buying during a market crash. However even if you don’t, you should still see dividend come in and have passive income to sustain you while you wait for a rebound.
So let’s take a look at some great options for your watch list.
If you want stability you’re going to want to look into Fortis Inc. (TSX:FTS)(NYSE:FTS). The company had a minor dip when the market crashed, but has seen come back to pre-crash levels. Looking back even further, Fortis has a long history of stable returns. This comes from the company’s business: utilities. Even when the economy is down, you still need the lights on. Fortis should continue to make solid revenue that will support its dividend for years to come.
The company currently offers a 3.88% dividend yield. So let’s say you were to put a third of your Tax-Free Savings Account (TFSA) contribution room towards this stock. That would bring in $977 per year in passive income!
Nutrien Ltd. (TSX:NTR)(NYSE:NTR) might not have the history that Fortis does, but it has the future. The company provides crop nutrients around the world. It’s been acquiring businesses all over the place, taking over the market share of the crop nutrient business. In the future, with the world having less and less arable land, this business will take over. That leaves its dividend solid and safe as a necessity now and in the future.
The company currently offers a 3.77% dividend yield. If you were to put another third of your TFSA room towards this stock, that would bring in $969 in annual passive income.
Finally, the Big Six Banks in Canada offer a solid way for long-term shareholders. But if you want dividends, you want Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM). The bank offers the highest dividend yield of the big six banks, and has a solid growth plan to expand beyond the Canadian market. So there are plenty of reasons to consider this stock.
CIBC currently sports a 5.22% dividend yield as of writing. If you were to put that last third of your TFSA room toward this stock, you would bring in a whopping $1,324 in annual passive income.
If you’re looking for a passive income to get you through the market crash, you can’t go wrong with these stocks. All together, if you created this passive income you would have a total of $3,270 in annual passive income!
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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 has no position in any of the stocks mentioned. The Motley Fool recommends FORTIS INC and Nutrien Ltd.