Build a Passive Income Stream Starting With Just $10,000

Investors looking to build a steady passive income stream through investments could consider starting with $10,000 in top dividend-paying stocks. These fundamentally strong TSX stocks are reliable bets for earning regular passive income over the long term.

Moreover, by starting with $10,000 and adding to your holdings over time, you can gradually build a portfolio that will generate substantial passive income.

Against this background, here are two TSX stocks to add to your portfolio to build a passive income stream starting with just $10,000.

Passive income stock #1

Brookfield Renewable Partners (TSX:BEP.UN) is an attractive stock for starting a passive income stream. Its solid record of dividend growth, visibility into future payments, sustainable payouts, and high yield make Brookfield a solid investment for generating steady income.

Specializing in diversified renewable energy infrastructure assets, Brookfield operates with substantial capacity and a robust development pipeline. This positions the company to capitalize on the growing demand for clean energy solutions.

While Brookfield is poised to benefit from solid secular tailwinds, its operational framework adds another layer of stability. Notably, about 90% of its power generation is supported by long-term contracts, ensuring stability and predictability. Moreover, a significant portion of its revenues is indexed to inflation, safeguarding and expanding its margins over time. Furthermore, it has a diversified customer base, and none account for more than 2% of its revenues.

Thanks to its solid business model and increasing demand, Brookfield Renewable has consistently grown its funds from operations (FFO), enabling the green energy company to return significant cash to its shareholders. BEP.UN has raised its dividend by at least 5% annually for the past 14 years. Moreover, based on its current quarterly dividend of US$0.373 per share (or $0.51 a share), Brookfield offers a high yield of 6.4%.

Its large-scale, diverse portfolio and growing pipeline of projects tailored to meet the increasing demand for renewable electricity will support its growth. Moreover, the company’s management expects to deliver a total return of 12% to 15% annually in the long term, implying it could continue to grow its dividend at a healthy pace.

Passive income stock #2

Enbridge (TSX:ENB) is another top TSX stock to consider to earn steady passive income for decades. The company that transports oil and gas has been distributing dividends for over 70 years. Moreover, ENB stock increased its dividend at a compound annual growth rate (CAGR) of 9% in the last 30 years. Its solid payouts reflect the strength and resiliency of its business model and ability to grow earnings in all market conditions.

The energy delivery company’s diversified assets are supported by long-term contracts, regulatory frameworks, and power-purchase agreements. This structure enables it to grow its earnings and distributable cash flow (DCF), supporting its payouts. ENB currently pays a quarterly dividend of $0.943 per share, translating into a high yield of 6%.

Enbridge operates one of North America’s largest networks of liquid pipelines, which consistently sees high levels of asset utilization. At the same time, its natural gas transmission business benefits from rising demand, particularly from expanding data centres and growing industrial operations. In addition, the company’s gas distribution and storage segment continues to expand steadily, driven by customer growth and ongoing modernization efforts.

The energy firm is also increasing its exposure to the renewable energy sector, supporting its earnings and dividend payments. Enbridge’s bottom line and DCF will grow at a mid-single-digit rate over the coming years. With this outlook, the company appears well-positioned to maintain and grow its dividend at a similar pace.

Earn Over $612 per year in dividend income

Brookfield Renewable and Enbridge are dependable passive-income stocks offering attractive dividend yields. The table below shows that a $10,000 investment in these two stocks would generate approximately $153.04 in quarterly income, totalling $612.16 annually.