Retirees: How to Make Over $95/Week in Passive Income TAX FREE!

Canadian retirees who are hungry for passive income should look to snag stocks like Sienna Senior Living Inc. (TSX:SIA) in their TFSAs.

| More on:
Retirees sip their morning coffee outside.

Source: Getty Images

The COVID-19 pandemic inspired many Canadians to accelerate their retirement plans. Retirees were treated to a renewed bull market following an early dip in 2020. However, the environment for savers has worsened considerably in 2022. Inflation has climbed to a 40-year high, which has made it difficult to keep up inflation, even with some of the highest-yield dividend stocks.

Today, I want to discuss how retirees can look to generate more than $95 a week in passive income. Better yet, retirees who stash these stocks in a Tax-Free Savings Account (TFSA) can count on tax-free passive income.

Retirees should target this long-term-care stock for its dividend yield

Sienna Senior Living (TSX:SIA) is a Markham-based company that provides senior living and long-term-care (LTC) services in Canada. Shares of this dividend stock have dropped 9.6% in 2022 as of late-morning trading on August 11. The stock is down 12% from the previous year.

This stock closed at $13.74 on August 10. In our hypothetical, retirees can look to snatch up 1,600 shares of Sienna for a purchase price of $21,984. The stock last paid out a monthly dividend of $0.078 per share. That represents a very tasty 6.8% yield. This investment will allow us to generate weekly passive income of $28.80 in our retirement portfolio.

This REIT can seriously bolster your passive-income portfolio

Real estate investment trusts (REITs) have been a great source of income for Canadians over the past decade. Slate Grocery REIT (TSX:SGR.UN) offers exposure to grocery retailers in the United States. This has been a worthy target with food prices surging in North America in recent months. Shares of this REIT have climbed 2.4% so far this year.

This REIT closed at $14.94 on August 10. Retirees can snag 1,300 shares of Slate Grocery for a purchase price of $19,422. The REIT offers a monthly distribution of $0.072 per share. This means retirees can now churn out monthly passive income of $21.60 per share.

Here’s another dividend stock perfect for a retiree

Canadian energy stocks enjoyed a big upswing in the first half of 2022. Oil and gas prices started strong and erupted after Russia’s invasion of Ukraine on February 24, 2022. Keyera (TSX:KEY) is a Calgary-based energy infrastructure company. This stock has increased 12% so far in 2022.

Keyera closed at $31.98 per share on August 10. We can snatch up 600 shares of Keyera for a total price of $19,188. This stock currently offers a monthly dividend of $0.16 per share. That represents a strong 6% yield. Retirees can now count on monthly passive income of $22.15 from this investment.

One more stock that can deliver big passive income in the final months of 2022

Extendicare (TSX:EXE) is the fourth dividend stock retirees can target to shore up their passive-income portfolio. This Markham-based company provides care and services for seniors in Canada. Its shares have climbed marginally in the year-to-date period.

This stock closed at $7.46 per share on August 10. For our final purchase, we can buy 2,800 shares of Extendicare for a total of $20,888. Extendicare offers a monthly distribution of $0.04 per share, which represents a tasty 6.4% yield. We can now churn out weekly passive income of $25.84 in our TFSA.

Bottom line

These investments will allow retirees to generate monthly passive income of $98.39 per week in their TFSA going forward. That is a solid rate in this inflationary climate.

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 Ambrose O'Callaghan has no position in any of the stocks mentioned. The Motley Fool recommends KEYERA CORP.

More on Investing

Nickel ore is mined from the ground.

Cameco vs. Barrick Gold: 2 Undervalued Mining Stocks Set to Unearth Gains

Cameco (TSX:CCO) and Barrick Gold (TSX:ABX) are top mining stocks that look to be on sale right here!

Read more »

stock research, analyze data

Could Dollarama Stock Reach $150?

After gaining over 44% in the last 12 months, can Dollarama stock keep up this exceptional growth rate and climb…

Read more »

Tech Stocks

3 Reasons to Buy Shopify Stock Like There’s No Tomorrow 

Shopify stock fell 25% after reporting disappointing guidance. Should investors buy the dip and hold the stock for the long…

Read more »

grow dividends
Dividend Stocks

3 Canadian Stocks With a Real Chance of Doubling Your TFSA’s Value

Three outperforming Canadian stocks can help TFSA investors double their account balances.

Read more »

Hand writing Time for Action concept with red marker on transparent wipe board.
Dividend Stocks

3 No-Brainer Stocks I’d Buy Right Now Without Hesitation

At any given time, the market may have certain stocks that offer a powerful combination of reliability, potential, valuation, etc.,…

Read more »

Hand arranging wood block stacking as step stair with arrow up.
Tech Stocks

3 Canadian Growth Stocks I’d Buy Under $30

These under $30 Canadian growth stocks are well-positioned to capitalize on mega trends such as e-commerce, the electrification of vehicles,…

Read more »

Gas pipelines
Stocks for Beginners

3 Reasons to Buy Enbridge Stock Like There’s No Tomorrow

Enbridge (TSX:ENB) is a superb long-term option. Here's why you should buy Enbridge stock right now and hold it for…

Read more »

money cash dividends
Dividend Stocks

This 8.39% Dividend Stock Can Pay $100 Cash Every Month

Consider investing in this monthly dividend stock at current levels to lock in high-yielding monthly distributions to create a good…

Read more »