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Canadian wages have not kept pace with the rapid pace of inflation in 2022. That has led some investors to make up the difference as monthly bills continue to mount. Today I want to talk about how you can earn passive income of $100 a week and not have to pay any taxes on that amount at all. In this hypothesis, we will use our entire tax-exempt savings account (TFSA) space – the full $81,500.
Here’s a healthcare stock that offers passive income and is worth holding for the long term
Extendicare (TSX:EXE) is the first dividend stock I would pick to start building our passive income portfolio. Based in Markham, this company provides care and services to seniors in Canada. Shares in Extendicare are up slightly year-to-date. The stock is down 7.5% compared to the same period in 2021.
The company announced its results for the second quarter (Q2) of fiscal 2022 on August 9. It posted revenue growth of 5.3% to $296 million. Meanwhile, net operating income increased $1.4 million to $30.3 million.
This stock closed at $7.44 per share on Aug. 18. In our hypothesis, we can snag 3,650 shares of Extendicare for a total purchase price of $27,156. The stock offers a monthly dividend of $0.04 per share. That equates to a tasty 6.4% yield. This purchase will also allow us to generate a monthly passive income of $33.69. Better yet, this will be totally tax-free in our TFSA!
Don’t sleep on this REIT that boasts a monster dividend
Northwest Healthcare REIT (TSX:NWH.UN) is a Toronto-based real estate investment trust (REIT) that owns and operates a global portfolio of quality healthcare properties. Shares of this REIT are down 4.1% in 2022. The stock is still up 1.6% year over year.
In the second quarter of 2022, the Northwest REIT reported revenue growth of 24% to $111 million. Meanwhile, it delivered 8% growth in net asset value (NAV) per unit to $14.19, while total assets under management (AUM) rose 22% to $10.2 billion.
Shares of this REIT closed at $13.11 on Aug. 18. We can buy 2,070 shares of the Northwest REIT for a total price of $27,137 for our scenario. The Northwest REIT offers a monthly dividend of $0.067 per share. That corresponds to a return of 6.1%. This investment will allow us to earn $32 monthly tax-free passive income.
Another stock to round out our passive income portfolio
Sienna senior housing (TSX:SIA) is the third dividend stock I would target in the final weeks of summer 2022 to complete our passive income portfolio. This Markham-based company also provides senior and long-term care (LTC) services in Canada. Its shares are down 8.5% year-to-date.
The Dividend Stock closed at $13.94 on Aug. 18. For our latest purchase, we can snag 1,950 shares of Sienna for a total purchase price of $27,183. Sienna offers a monthly payout of $0.078 per share, which translates to a tasty 6.7% yield. We can now generate monthly passive income of $35.10/week in our TFSA.
These investments will allow us to generate tax-free passive income of $100.79 per week.