Starting the second half of your life as a retiree is exciting and scary. You are no longer a salaried employee. But guess what – you can put your work experience to use and let your brain do even more work. Billionaire investor Warren Buffett made 90% of his wealth after retirement.
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Five stocks for retirees
Here are five stocks across Canada’s key sectors that can earn you money while you are eating, sleeping, and vacationing.
Enbridge stock
Enbridge (TSX:ENB) is strategically relevant for Canada. The energy firm houses the world’s fourth-largest oil sands reserves. Its pipeline system transports 30% of the crude oil produced in North America and 20% of the natural gas consumed in the United States. Short-term tariffs do not affect its cash flow. However, a transition away from oil to renewables or natural disasters disrupting infrastructure could affect Enbridge materially. It is tackling the first risk by building natural gas pipelines and acquiring gas utilities.
The company earns cash from the toll money, which it passes on to shareholders after deducting the amount to build new pipelines, maintain or expand existing pipelines, and service debt. So far, it has 200 assets – pipelines, storage, utilities, and renewable power plants – that earn regular cash flow, and this count keeps rising. You can consider this stock for its 6% dividend yield, which grows by 3% annually.
SmartCentres REIT
SmartCentres REIT (TSX:SRU.UN) can earn you rent from Walmart stores. The REIT owns and leases 174 properties, of which around 98.4% are occupied. Walmart occupies 40.3% of the leased area. If we take the fair market value of all the properties combined, each unit of SmartCentres REIT is worth $35.10, and the unit was trading at a 27% discount at $25.34 at the time of writing this article.
The REIT is paying almost 84% of its adjusted funds from operations as distributions. This model can earn passive income. The risk comes when the real estate market collapses, and the occupancy rate falls significantly. A decline in property value could reduce SmartCentres’ unit price, and low occupancy can reduce its cash available for distributions. However, the real estate market is reviving from the 2022 crash, and you can get regular monthly distributions through rent and unit price growth through property value appreciation.
Telus stock
Telus Corporation (TSX:T) earns income from the money it collects for telecom subscriptions. It has laid the 5G infrastructure, which has significantly increased its debt. However, it now has to monetize the infrastructure by offering bundled services to households, offices, and industries within its reach. Telus is doing a good job at it. However, the regulatory change of giving competitors access to its fibre has made the sector price-competitive.
Telus is tackling the challenge by reducing capital spending, selling off non-core assets to reduce debt, and accessing competitors’ fibre to offer its bundled services. It has slowed its dividend growth to 3–8% for 2026 from 7–10% in previous years due to price competition. Nevertheless, the amount you spend on the internet will only grow as more devices connect to the internet and the use of artificial intelligence increases.
Power Corporation of Canada
Power Corporation of Canada (TSX:POW) is the holding company of Great-West Lifeco and IGM Financial. POW earns money from the profits and dividends the operating companies give to the parent. Great West Lifeco benefits from rising insurance demand amid increasing risk. IGM Financial benefits when the equity markets worldwide perform well. The two contrarian industries offset each other’s weaknesses and generate regular dividends.
The 2008 Global Financial Crisis was the only time POW took a significant hit as the entire financial sector collapsed. The company took six years to resume dividend growth. The financial system and the company have come far from 2008 and have the necessary systems in place to manage risk. You can consider POW for its dividends.
Growth stock for retirees
Retirees can consider investing a small portion in Constellation Software for wealth creation. The company reinvests the money to grow through acquisitions instead of distributing it to shareholders.
