Generating passive income can put you on the path to financial freedom. It can help you offset some of your expenses, reducing your time commitment to actively work on financing your lifestyle. The more passive income you can generate, the less dependent you will become on your career for income.
Buying stocks that pay dividends is a great way to start making money sustainably passive income. Two great dividend stocks to buy for income right now are Brookfield Renewable (NYSE: BEPC)(NYSE:BEP) And Enbridge (NYSE: ENB). She pay high-yield dividends that should continue to grow in the coming decades.
Brookfield Renewable has a terribly reliable dividend over the past few of decades. The leading global renewable energy Since 2001, the producer has increased its payout at a compound annual rate of 6%. He has increased his payment by at least 5% every year since 2011.
The company currently pays a dividend of over 5.6%. That is several times higher than the S&P500'S dividend yield of 1.2%. At that rate, every $100 invested in Brookfield Renewable stock would generate $5.60 in annual dividend income each year. That compares to only about $1.20 in dividend income from a comparable investment in an S&P 500 index fund.
Brookfield Renewable aims to increase its dividend by 5% to 9% annually over the long term. It must have sufficient power to achieve that goal. The company has several growth drivers, including inflation-related tariff increases, rising energy prices, development projects and acquisitions. These catalysts shape the company's vision that it can grow its resources from operations (FFO) per share at an annual rate of more than 10% over the next ten years.
Development projects are a important growth engine for Brookfield Renewable. It currently has as much as 200 gigawatts (GW) of projects under development, compared to its operating portfolio of 37 GW. And it has about 65 GW of late-stage projects in the pipeline that it should complete by 2030. Development projects will grow FFO per share approximately 4% to 6% annually over the next few years. With demand for renewable energy only expected to continue to grow, Brookfield should be able to continue to grow in the coming decades.
Enbridge has been an extremely reliable dividend stock. The Canadian pipeline and utility company has been paying dividends to its investors for 70 years and has increased its payout annually for the past 30 years in a row. The dividend currently yields more than 6%.
The company generates very stable cash flow to support its high-yield dividend. About 98% of revenue comes from cost-of-service agreements or long-term contracts. These agreements give Enbridge a lot of insight into its revenues. This is evident from the fact that the company was on track to achieve its annual financial guidance in 2024 for the 19th year in a row.
