Turn Your Savings Into a Passive-Income Powerhouse With 2 Stocks

These two Canadian dividend stocks could reward investors with increasing dividends for decades.

| More on:
grow money, wealth build

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Who doesn’t want to see their savings grow while earning a steady stream of income? While there are many ways of building passive income, investing in high-quality dividend-paying stocks remains one of the most reliable and arguably the easiest options for Canadian investors. By adding fundamentally strong dividend stocks to your portfolio, you can turn your hard-earned savings into a passive-income powerhouse.

In this article, I’ll highlight two Canadian dividend stocks that offer a great combination of attractive yields and long-term growth potential, making them ideal for generating passive income for decades.

IGM stock

Whether you’re just starting your passive income journey or looking to enhance your existing portfolio, IGM Financial (TSX:IGM) could be an excellent pick. This Winnipeg-headquartered wealth and asset management company currently has a market cap of $11.2 billion as its stock trades at $47 per share after surging by 34% so far in 2024. Although IGM stock has outperformed the broader market by a wide margin this year, it still offers a 4.8% annualized dividend yield.

Not only is IGM’s current dividend yield attractive, but its financial performance in 2024 has also been impressive. In the third quarter ended in September 2024, the company achieved record-high assets under management and advisement of $264.9 billion, reflecting a strong 16.5% YoY (year-over-year) increase. IGM’s adjusted quarterly earnings climbed by 17.1% from a year ago to $1.03 per share with the help of strong growth across its core wealth and asset management segments.

In addition, the company’s strategic investments, such as its stake in Wealthsimple, have shown notable growth, with Wealthsimple’s valuation increasing by 46% sequentially in the most recent quarter. These developments establish IGM Financial as not just a reliable dividend payer but also a forward-looking financial services firm that continues to adapt to evolving market trends, which should help its share prices inch up in the long run.

Created with Highcharts 11.4.3Igm Financial + Brookfield Renewable Partners PriceZoom1M3M6MYTD1Y5Y10YALLwww.fool.ca

Brookfield Renewable stock

For investors looking to create a sustainable and long-term passive-income stream, Brookfield Renewable Partners (TSX:BEP.UN) could be another excellent option to consider right now. After advancing by nearly 17% over the last nine months, its stock currently trades at $36.19 per share with a market cap of $10.3 billion. At the current market price, it has an annualized dividend yield of 5.5%.

Specializing in solar, wind, hydroelectric, and energy storage assets, Brookfield Renewable is not only a consistent dividend payer but also a company actively building a future-ready energy portfolio. In the most recent quarter, the company reported an 11% YoY increase in its funds from operations to US$278 million, with improving operational efficiency and growth in its revenue-generating assets.

In the September quarter alone, Brookfield commissioned 1,200 megawatts (MW) of new renewable capacity.  With 200,000 MW of total pipeline capacity and 65,000 MW in advanced stages, the company is fast emerging as a global force in the renewable energy space. As the demand for clean energy continues to rise across the globe, Brookfield Renewable seems well-positioned to benefit from this trend, which could help it continue rewarding loyal investors with increasing dividends.

Should you invest $1,000 in Harvest Nvidia Enhanced High Income Shares Etf right now?

Before you buy stock in Harvest Nvidia Enhanced High Income Shares Etf, consider this:

The Motley Fool Stock Advisor Canada analyst team just identified what they believe are the Top Stocks for 2025 and Beyond for investors to buy now… and Harvest Nvidia Enhanced High Income Shares Etf wasn’t one of them. The Top Stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 ... if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $20,697.16!*

Stock Advisor Canada provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month – one from Canada and one from the U.S. The Stock Advisor Canada service has outperformed the return of S&P/TSX Composite Index by 29 percentage points since 2013*.

See the Top Stocks * Returns as of 3/20/25

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 Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool recommends Brookfield Renewable Partners. The Motley Fool has a disclosure policy.

Confidently Navigate Market Volatility: Claim Your Free Report!

Feeling uneasy about the ups and downs of the stock market lately? You’re not alone. At The Motley Fool Canada, we get it — and we’re here to help. We’ve crafted an essential guide designed to help you through these uncertain times: "5-Step Checklist: How to Prepare Your Portfolio for Volatility."

Don't miss out on this opportunity for peace of mind. Just click below to learn how to receive your complimentary report today!

Get Our Free Report Today

More on Dividend Stocks

analyze data
Dividend Stocks

How I’d Invest $28,000 in Canadian Natural Resource Stock to Amass Personal Wealth

Investing in TSX dividend stocks such as Enbridge can help you earn a passive-income stream in 2025.

Read more »

hand stacks coins
Dividend Stocks

Got $400? How I’d Start Building Income With 3 High-Yield Stocks for the Long Term

These high-yield dividend stocks have a solid payout history, making them compelling investments to generate passive income.

Read more »

A close up color image of a small green plant sprouting out of a pile of Canadian dollar coins "loonies."
Dividend Stocks

I’d Put $15,000 in These 3 Dividend-Growth Champions for Increasing Income Potential

Want to offset some volatility? Here are three defensive dividend-growth champions that can generate a juicy yield right now.

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Dividend Stocks

Transform Your TFSA Into a Cash-Creating Machine With $7,000

Discover how the Tax-Free Savings Account can be your golden goose for generating cash without losing your investment.

Read more »

monthly desk calendar
Dividend Stocks

How I’d Invest $10,000 in Canadian Value Stocks for Monthly Dividend Income

A $10,000-diversified portfolio of value stocks focusing on dividend safety, yield, growth, and payment schedules can provide a reliable source…

Read more »

a person watches a downward arrow crash through the floor
Dividend Stocks

Is This Correction Your Chance? Top 4 Canadian Dividend Stocks on Sale

Stocks may be down, but now is your chance to get some of these top dividend stocks on sale.

Read more »

Confused person shrugging
Dividend Stocks

Where to Invest $2,500 in the TSX Today

These TSX stocks offer attractive dividends and a shot at decent upside on a rebound.

Read more »

Pile of Canadian dollar bills in various denominations
Dividend Stocks

Invest $25,000 in These Dividend Stocks for $1,956.66 in Annual Passive Income

Dividends stocks can make a huge difference, even if shares don't move an inch. And these might be the best.

Read more »