Although it may not seem like a big deal, and it certainly isn’t a reason on its own to buy or pass on a stock, earning monthly dividends can still make a real difference, especially for long-term investors focused on building income over time.
Monthly dividends help your money compound faster, help smooth out cash flow, and make it easier to reinvest consistently, regardless of what the market is doing.
They’re also ideal for investors who want income they can rely on through different market environments. When markets are volatile or moving sideways, that steady stream of cash can help cushion returns and reduce the temptation to make emotional decisions.
Of course, the frequency of dividends is just one factor, and a relatively small one at that. That’s why the goal isn’t just to find stocks that pay monthly, but to find high-quality dividend stocks that can actually sustain those payments and increase them over the long haul.
So, with that in mind, if you’ve got that cash you’re looking to invest and want to boost your passive income, here are two of the best monthly dividend stocks to buy now.
A reliable monthly dividend stock offering exposure to residential real estate
There are a handful of high-quality monthly dividend stocks to consider on the TSX, especially in the real estate sector. However, there’s no question that one of the very best is Morguard North American Residential REIT (TSX: MRG.UN).
Morguard owns a diversified portfolio of apartment properties across Canada and the United States, which gives it exposure to one of the most defensive asset classes you can own.
People always need a place to live, regardless of where the economy is in the cycle, and that makes residential rent one of the most reliable sources of cash flow out there.
What makes Morguard particularly appealing right now is that it’s focused on necessity-based housing, not luxury condos or speculative development. That leads to stable occupancy, predictable rent collections, and dependable monthly income.
Furthermore, the diversification in its portfolio helps reduce risk and ensures that Morguard has more opportunities for growth as different regions experience different environments.
Therefore, because of the diversification and its ultra-defensive operations that generate consistent cash flow from long-term tenants, it’s able to pay a steady monthly distribution while still maintaining a reasonable payout ratio.
And right now, after Morguard just increased its dividend for the second time in less than six months and its third time in just over a year, the REIT now offers a yield of roughly 4.5%.
So, if you’re looking for a monthly dividend stock offering exposure to residential real estate and its predictable demand, Morguard North American Residential REIT is one worth owning for the long haul.
One of the safest stocks that passive income seekers can buy
In addition to Morguard, another top-notch monthly dividend stock that investors can consider today is CT REIT (TSX: CRT.UN).
CT REIT is a retail REIT, but it’s one of the most reliable dividend stocks you can own because nearly its entire portfolio of retail properties is leased to Canadian Tire and its related banners.
Furthermore, Canadian Tire isn’t just its largest tenant; it also owns the majority of CT REIT’s units, making that relationship one of the main reasons CT REIT is such a reliable investment.
Because of that structure, CT REIT generates extremely predictable cash flow. Occupancy is consistently high, and rent escalators are built into many of its contracts.
So, if you’re looking for a reliable monthly dividend stock that can pay an attractive yield and continue to increase its dividend every year, CT REIT is one of the best and currently offers a yield of roughly 5.7%.
