Building a passive-income portfolio that can generate hundreds of dollars doesn’t always need thousands of dollars coupled with decades of savings.
Many investors don’t realize that a single high‑yield stock can kick‑start a real passive-income stream. That stock to consider is Telus (TSX: T), and here’s why now is the right time to buy.
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Introducing Telus
Most Canadians are familiar with Telus. Telus is one of Canada’s big telecom stocks. The company provides subscription-based services across segments for wired, wireless, internet, and TV services to millions of customers across the country.
This makes Telus especially appealing for investors who prioritize stable passive income.
Telus’s core business is built on that subscription‑based revenue, which translates into a monthly revenue stream that is backed by increasingly defensive offerings. For investors, this creates a steady and predictable cash flow stream.
Telecoms like Telus are naturally defensive businesses. People rarely cancel their phone or internet service during economic downturns, and that stability helps support long‑term dividend programs.
If anything, over the past decade, the defensive appeal of data-capable devices and home internet service has only grown.
Maintaining that service requires a massive network, and Telus has spent years expanding its fibre network. These have all helped Telus to strengthen its competitive position.
Why Telus’s dividend matters for income investors
Telus has built its reputation as one of Canada’s most consistent dividend payers. The company boasts a solid history of paying dividends that extends over two decades.
As of the time of writing, Telus offers a yield of 9.64%. That represents one of the highest yields on the market, and the highest among its big telecom peers.
One of the main reasons for that is that elevated yield can be traced back to the elevated interest rates over the past several years. Telecoms are capital-intensive businesses, and when rates rise, the cost of financing upgrades to those massive networks also rises.
This put pressure on the stock price and also led many investors to rotate out of Telus and into higher-growth options.
As a result, Telus was forced to halt its practice of providing dividend increases to focus on paying down debt. It should be noted that Telus did stop short of slashing its dividend, and the company has already shown solid signs of improvement.
Still, the yield remains elevated for the moment, which represents a unique opportunity for investors looking to generate passive income. For income-focused investors, that yield is hard to ignore.
How $3,000 in Telus can generate passive income
To illustrate that passive-income potential, let’s consider a $3,000 investment in Telus.
From that initial investment, investors can expect to generate approximately $290 in annual dividends. While that’s not enough to retire on immediately, it is enough to generate more than a dozen new shares through reinvestments alone.
Reinvesting dividends accelerates compounding, allowing the income stream to grow over time without requiring additional contributions. For long‑term investors, that mix of yield and compounding can make a real difference.
The other key point for investors to consider is that $3,000 initial seed investment. That works out to $250 per month when invested over the course of an entire year.
If investors were to follow that initial investment year with similar annual contributions in subsequent years, that investment can generate substantial passive income.
Telus can be your passive-income engine
Telus brings together stability, essential services, and a strong dividend. That makes the stock a strong option for investors seeking passive income.
And with just $3,000 invested, shareholders can generate nearly $290 per year in dividends. That amount shows how passive income is possible given the right stock.
In my opinion, Telus is a great long-term investment for income seekers and should be a small position in any well-diversified portfolio.
Buy it today, let it reinvest, and then watch as your future passive income grows.
