5 Top Dividend Stocks to Turn Your Savings Into a Steady Income Stream

Whether you want diversification or simple income streams, these five dividend stocks offer it not just now but for life!

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Whether you’re looking for monthly income, global market access, real estate stability, banking strength, or insurance reliability, these picks have got you covered. By adding these to your portfolio, you’re not just investing in stocks. You’re investing in a steady, growing income stream that can support your financial goals. So, let’s get into the five best stocks to turn your savings into a steady income stream.

ZMI ETF

First, let’s start with a steady exchange-traded fund (ETF): BMO Monthly Income ETF (TSX:ZMI). The ZMI ETF is like the Swiss Army knife of your investment portfolio. This ETF is designed to provide monthly income, and it does so with a diverse mix of Canadian stocks and bonds. 

Over the years, ZMI has demonstrated strong performance, consistently paying dividends. Historically, it’s provided a yield hovering around 4-5%. This is a sweet spot for those looking for a steady income without excessive risk. Right now, it sits just higher at 5.09%.

With its balanced approach, ZMI isn’t just a bet on one sector or one company; it spreads out the risk and ensures you get a piece of the action from multiple sources. As the economy grows and these underlying assets appreciate, your steady stream of income continues to flow.

VXC ETF

Next up is Vanguard FTSE Global All Cap ex Canada Index ETF (TSX:VXC). If ZMI is your Swiss Army knife, VXC is like having an all-access pass to the world’s best financial markets. This ETF provides exposure to over 10,000 stocks from developed and emerging markets, excluding Canada. 

By investing in VXC, you’re tapping into global economic growth. Historically, VXC has delivered solid returns, supported by dividends from international giants. Its yield might be slightly lower than ZMI at 1.53%, but the growth potential is immense. As global markets expand and companies continue to pay dividends, VXC investors can enjoy a growing income stream from diverse sources around the globe.

Granite REIT

Now, to throw a real estate investment trust (REIT) in the mix. Granite Real Estate Investment Trust (TSX:GRT.UN) is a crown jewel of the real estate sector. Specializing in industrial and logistics properties, Granite has a rock-solid portfolio that generates consistent rental income. 

Over the years, Granite has shown impressive growth, expanding its portfolio and increasing its funds from operations (FFO). This growth translates into higher dividends for shareholders. Currently, GRT.UN offers a dividend yield of around 4.96%, which is both attractive and sustainable. With the increasing demand for industrial spaces driven by e-commerce and global trade, Granite’s future looks bright, ensuring that your investment continues to yield steady income.

CIBC

Canadian Imperial Bank of Commerce (TSX:CM) is a heavyweight in the Canadian banking sector. With a rich history and a reputation for stability, CM is a reliable income generator. Historically, CM has offered a robust dividend yield, often exceeding 5% and currently at 5.46%. The bank’s earnings growth has been steady, driven by strong performance in personal and commercial banking, wealth management, and capital markets. 

Even in turbulent economic times, CM has managed to maintain and even grow its dividend payouts. Looking ahead, as the economy recovers and interest rates stabilize, CM’s strong fundamentals and prudent management will continue to support its dividend payments, making it a cornerstone of any income-focused portfolio.

Manulife

Finally, Manulife Financial (TSX:MFC) is a global giant in the insurance and financial services industry. Manulife’s business model generates steady cash flow, which is crucial for sustaining its dividend payments. Historically, MFC has provided a dividend yield in the range of 4-5% and at 4.51% as of writing, supported by consistent earnings growth. 

The company’s diverse operations across Asia, Canada, and the United States offer a cushion against regional economic fluctuations. As the global population ages and the demand for insurance and retirement products rises, Manulife is well-positioned to capitalize on these trends. This future growth potential means more earnings and, consequently, more dividends for shareholders.

So, from diversified ETFs that give you global exposure and balance to individual stocks that dominate their sectors, these investments combine historical performance with future growth potential.

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 positions in Canadian Imperial Bank Of Commerce and Vanguard Ftse Global All Cap Ex Canada Index ETF. The Motley Fool recommends Granite Real Estate Investment Trust. The Motley Fool has a disclosure policy.

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