Ask any income-focused investor, and they will say that there’s only one thing better than a quarterly dividend. That one thing is getting paid on a monthly cadence. Monthly dividends, especially a higher yield from a 6% dividend stock, can be a powerful source of income.
Monthly dividends are a better match for income-seekers. They align more closely with real-life bills and necessities. Not only does this make it easier to budget for, but it can also make compounding quicker.
So then, where can investors look to find that 6% dividend stock that pays out on a monthly schedule? REITs are great income investments that can provide that yield.
Specifically, SmartCentres REIT (TSX: SRU.UN) is one option for investors to consider. As of the time of writing, the REIT offers a monthly distribution that carries a 6.3% yield.
For Canadians building a passive income stream in a TFSA, including SmartCentres in an income portfolio can be a powerful addition.
Let’s dive into what makes SmartCentres the 6% dividend stock for your portfolio.
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SmartCentres is built around essential retail
SmartCentres is one of Canada’s larger REITs. The company focuses on retail properties, more specifically, shopping centres that provide necessity-based retail in Canada’s major metro markets. This means that the REIT draws regular foot traffic, and that helps to generate stable revenue.
This essential‑retail focus helps the REIT maintain steady occupancy and consistent rental income.
These are places people visit for groceries, household goods, pharmacy items, discount shopping, and other regular purchases. In other words, there’s defensive appeal when compared to more discretionary retail properties.
Even better, many of SmartCentres’ sites are Walmart-anchored properties. This gives those properties an even stronger traffic driver. And that traffic boost benefits smaller secondary tenants on the property too.
Growth could come from more than shopping centres
Despite SmartCentres focusing on retail shopping centres, the REIT is looking at other long-term development options.
One emerging trend in the REIT space is the shift to multi-level retail space and mixed-use properties. This opens up the opportunity for SmartCentres to unlock more value from the land it already owns.
By way of example, this includes adding residential towers above those retail sites. Alternatively, it can even include offices or other types of properties.
With housing already in short supply and would-be tenants forced to look outside of metro markets, SmartCentres’ diversification into mixed-use properties could provide significant long-term growth.
The 6% dividend stock that pays investors every month
The main reason many investors turn to SmartCentres is for the monthly distribution that it offers. And for income investors, the reliability of monthly cash flow is often just as important as the size of the yield.
The current 6.3% yield is handily one of the better-paying options on the market. That makes it especially relevant for investors searching for monthly REIT income or other TFSA income ideas. Given an initial $7,000 investment, investors can expect to earn just under $440 each year.
That’s not enough to retire on, but for long-term investors, it’s enough to generate one new share each month from reinvestments alone. Over a longer period of time, this can compound into a major income engine.
In fact, within a TFSA, compounding remains tax-free, allowing it to grow even quicker. That tax‑free structure makes each monthly payout even more valuable over time.
For investors seeking monthly income, SmartCentres is a solid option as part of a larger, well-diversified portfolio. It also fits investors looking for Canadian passive income without moving outside the TSX.
Buy it, hold it, and watch your income grow.
