Establishing a recurring passive-income stream is the hope and wish of both seasoned and new investors alike. And while there are plenty of income-producing stocks on the market, few can provide a recurring (and stable) monthly income.
Here’s a look at how just a few great stocks and and investment of $10,000 can provide almost $100 in monthly income.
(Don’t) start with your (rental) home
A rental property is one of the best-known ways to establish passive income. Unfortunately, it comes with an extremely high cost of entry. Specifically, mortgage rates are high, downpayment requirements have never been higher, and taxes continue to rise.
The alternative to consider is RioCan Real Estate (TSX: REI.UN). RioCan is one of the largest real estate investment trusts (REITs) in Canada. The REIT boasts nearly 200 properties, which includes a growing presence of mixed-use properties known as RioCan Living.
These properties are located in Canada’s major metro areas along high-traffic transit corridors. This makes them in demand for would-be homebuyers who are priced out of the market. And that’s where the opportunity for investors comes into play.
RioCan provides investors with a monthly distribution, which currently carries a yield of 6.05%.
This means that investors who drop $10,000 can expect to generate $50 in monthly income. While that’s not enough to retire on, there are two key points to note.
First, prospective investors not ready to draw on that income yet can choose to reinvest it until needed. This allows any eventual income to grow without further investment, making this a great buy-and-forget option.
Second, investing in RioCan is significantly lower risk than owning a single property, and comes at a far lower initial investment ask. Specifically, risk is spread out over potentially hundreds of units and comes without any maintenance or mortgages.
Add in a well-diversified monthly income stream
Exchange Income Corporation (TSX: EIF) is a company that isn’t recognized by many investors, at least initially. That being said, few investors will forget about Exchange once they realize the long-term potential the company offers.
Exchange is an acquisition-focused company that has over a dozen subsidiaries under its umbrella. Those subsidiaries are organized across two broad verticals comprising aviation and manufacturing.
Under each segment, the subsidiaries all have two key commonalities. First, they all provide a necessary service or function for which there are few, if any, alternatives. Many of the services provided by the aviation arm consist of serving the remote regions of Canada’s north.
The second point is that the subsidiaries all generate cash for the company. This has allowed Exchange to acquire additional companies over the years and pay out a handsome monthly dividend.
As of the time of writing, that dividend works out to an impressive 5.41%.
Using the same $10,000 investment noted above, investors can expect to generate a monthly income of almost $45 from that initial investment. And that’s not even the best part.
In addition to holding on to that investment until needed, prospective investors can also benefit from knowing that Exchange has provided investors with an annual bump to that dividend in 17 of the past 19 years.
Final thoughts
No stock is without some risk, and that includes the stocks mentioned above. Fortunately, both RioCan and Exchange boast some defensive appeal to investors. They also can provide a juicy monthly income.
| Company | Recent Price | No. of Shares | Dividend | Total Payout | Frequency |
| RioCan Real Estate | $18.30 | 546 | $1.11 | $50.51 | Monthly |
| Exchange Income Corporation | $49.06 | 203 | $2.64 | $44.66 | Monthly |
In my opinion, there’s a place for both stocks in any well-diversified portfolio. Buy them today and watch them (and your future monthly income) grow.
