As an income-seeking investor, one of the most satisfying things is getting a cheque each month. Fortunately, the market is flush with great stocks that pay a healthy monthly dividend.
Here’s a look at two great options that will cut you a dividend cheque each month.
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Want to be a landlord without a mortgage?
Let’s take a moment to talk about RioCan Real Estate (TSX: REI.UN). RioCan is one of the largest real estate investment trusts (REITs) in Canada, with a portfolio of over 180 properties located across the country.
RioCan has historically focused on commercial retail sites, but in recent years, the REIT has shifted to mixed-use residential properties.
And that’s where an opportunity for investors looking to get a cheque each month lies.
RioCan’s mixed-use residential portfolio comprises residential towers that sit atop several floors of retail. The properties are located in high-traffic, in-demand areas in Canada’s metro areas.
This not only caters to the lack of housing in those metro areas but also from an opportunity standpoint for would-be landlords.
Specifically, the average price of a home in Canada’s major metro areas is north of $1 million. This means that a traditional downpayment number is nearly $200,000 for a single property. Then, the mortgage on that property will be considerable, and that’s not even the case with taxes, insurance, repairs, and tenant issues.
The alternative is to invest in RioCan, with that risk spread over hundreds of units. And like a landlord collecting rent, RioCan cuts a dividend cheque each month. As of the time of writing, RioCan pays out a 5.90% yield.
This means that a $30,000 investment (far less than a traditional downpayment) will earn just shy of $150 each month. Keep in mind that that’s without a mortgage, taxes, or other obligations.
Even better, prospective investors who don’t need to draw on that income yet can reinvest it, allowing it to grow until needed.
Have you considered Exchange Income Corporation?
Exchange Income Corporation (TSX: EIF) is another great investment option that can cut you a cheque each month. For those unfamiliar with the company, Winnipeg-based Exchange is an acquisition-focused company that owns a dozen subsidiaries.
Those subsidiaries are broadly classified into aviation and manufacturing segments. Across both segments, those subsidiaries share two common elements that help to make Exchange a great investment option.
Specifically, they generate free cash for the company while also serving niche segments of the market. On the aviation side, this includes providing passenger and cargo services to remote regions of Canada’s north. On the manufacturing side, this includes custom manufacturing and communications services.
Collectively, they help Exchange to invest in new acquisitions while providing a tasty and well-covered monthly dividend. As of the time of writing, investors looking to get a cheque each month will appreciate the 4.63% yield on offer.
Prospective investors can also take solace in knowing that Exchange has provided annual bumps to that dividend, with 17 increases over the past 19 years.
Start getting your dividend cheque each month
Both Exchange and RioCan provide investors with a juicy cheque each month. They also benefit from some defensive appeal, which, in my opinion, makes them great options for any well-diversified portfolio.
Buy them, hold them, and watch them (and your income) continue to grow.
