As the retirement age approaches, investors must answer one key question: “How will I replace my paycheque?” While retirement plans such as the Canada Pension Plan offer a reliable monthly income stream, it’s not enough to lead a comfortable life.
Instead, quality dividend growth stocks offer a compelling solution for generating recurring monthly income. Over the years, blue-chip Canadian companies like Enbridge (TSX:ENB) and Fortis (TSX:FTS) have demonstrated a commitment to shareholders through decades of consistent dividend payments.
Moreover, a widening payout has meant these TSX dividend stocks can form the core of your income portfolio in retirement. So, let’s see how Canadian retirees can earn $36,000 annually or $3,000 each month via dividends.
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Is Enbridge a good stock to own right now?
Valued at a market cap of $138 billion, Enbridge is a Canada-based energy infrastructure giant. Its core business includes operating vast pipeline networks transporting crude oil and natural gas in Canada and the United States. Moreover, Enbridge operates natural gas utilities and is gaining traction in the clean energy segment with investments in wind, solar, and geothermal power generation.
While Enbridge is part of the highly cyclical energy sector, the company has consistently increased dividend payments over the last three decades. Since 1995, Enbridge’s dividends have risen at an annual rate of 10%, showcasing the resilience of its cash flows, which are tied to inflation-linked, long-term contracts.
Enbridge has increased its annual dividend from $0.26 per share in 1997 to $3.77 per share in 2024. These dividend hikes have meant that ENB stock has returned more than 6,000% to shareholders since January 1995 after adjusting for dividend reinvestments.
Despite its market-beating returns, ENB stock currently offers shareholders a yield of 6% right now.
Is the TSX dividend stock a good buy?
Valued at $30 billion by market cap, Fortis is a North American utility company that focuses on the distribution of electricity and natural gas. With operations in Canada, the U.S., and the Caribbean, its regulated utility operations serve more than 2.5 million customers.
Armed with an extensive infrastructure portfolio that includes power generation facilities, distribution lines, and natural gas pipelines, Fortis is a utility heavyweight. From providing electricity in Arizona to distributing natural gas in British Columbia and operating utilities in places like Newfoundland and the Cayman Islands, Fortis has established itself as a reliable utility provider since its founding in 1885.
Fortis has increased its annual dividend payment from $0.43 per share in 1997 to $2.46 per share in 2025. Its consistent dividend hikes have enabled the TSX stock to return over 3,000% to shareholders in dividend-adjusted gains since 1995.
The Foolish takeaway
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY |
| Enbridge | $63.31 | 5765 | $0.9425 | $5433 | Quarterly |
| Fortis | $60.13 | 6070 | $0.615 | $3733 | Quarterly |
The average dividend yield of the two TSX stocks is around 4.9%. So, to earn $36,000 a year in dividends, retirees would need to invest close to $730,000 equally distributed in the two stocks.
Fortis has increased its dividends by 6.4% annually in the last decade, while Enbridge’s growth is higher at 10.3%. If the two companies raise dividends by 7% each year, your payout will double over the next decade.
Identifying other fundamentally strong stocks with a tasty yield, strong balance sheets, and a growing payout is essential to diversify your income portfolio and lower overall risk.
