With no regular employment income to cover day-to-day expenses, retirees often prioritize preserving their capital while generating stable and reliable passive income. In addition, their shorter investment horizons leave less time to recover from market downturns, making capital preservation and income stability especially important.
As a result, retirees should focus on high-quality dividend stocks with established business models, dependable cash flow, and strong dividend payment records. With that in mind, I believe the following two dividend stocks could be ideal choices for retirees.
Source: Getty Images
Enbridge
Enbridge (TSX:ENB) operates a diversified energy infrastructure business that includes crude oil and natural gas pipelines, regulated utility assets, and renewable energy projects. Approximately 98% of its earnings are generated from long-term take-or-pay contracts and regulated assets, supporting stable and predictable financial performance across economic cycles.
Backed by these reliable cash flows, Enbridge has maintained dividend payments for over 70 years and increased its dividend for 31 straight years. The company currently offers an attractive forward dividend yield of 5.1%, making it an appealing option for income-focused investors.
Looking ahead, rising crude oil and natural gas production across North America is driving demand for Enbridge’s infrastructure and services. To capitalize on these opportunities, the company has identified roughly $50 billion in growth projects and plans to invest $10–$11 billion annually to fund its expansion.
These investments could support annual adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) and adjusted earnings-per-share growth of around 5% through the end of the decade. On the back of these growth prospects, Enbridge’s management expects to return $40–$45 billion to shareholders through dividends and share repurchases over the next five years. Considering its reliable business model, consistent dividend growth, high yield, and healthy growth prospects, I believe Enbridge is an excellent choice for retirees seeking dependable income and long-term stability.
SmartCentres Real Estate Investment Trust
Another high-yield dividend stock I believe is ideal for retirees is SmartCentres Real Estate Investment Trust (TSX: SRU.UN). The REIT owns and operates approximately 200 strategically located properties encompassing 35.5 million square feet of gross leasable area, with at least one property within 10 kilometres of around 90% of the country’s population. It also boasts a high-quality tenant base, with approximately 95% of tenants having a national or regional presence and nearly 60% providing essential services.
Supported by its prime locations and strong tenant mix, SmartCentres maintains healthy occupancy levels across economic cycles. Combined with ongoing lease-up activity and rising rental rates, this has supported solid financial performance and enabled the REIT to deliver attractive distributions. SmartCentres currently pays a monthly distribution of $0.15 per unit, representing a forward yield of 6.1%.
Looking ahead, demand for retail space in Canada remains strong, supported by economic growth and limited new supply amid elevated construction costs. At the same time, the REIT continues to advance its development pipeline, with approximately 0.8 million square feet of properties currently under construction, including a 200,000-square-foot retail project pre-sold to Canadian Tire. SmartCentres also recently acquired an 18.8-acre parcel of land in Kingston, Ontario, to support future retail expansion.
Its long-term growth outlook remains attractive, with approximately 87 million square feet of projects at various stages of planning and development. Given its stable occupancy, attractive yield, and robust development pipeline, I believe SmartCentres is well-positioned to continue delivering reliable, growing income, making it an excellent choice for retirees.
