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The biggest risk in retirement is your depleting retirement savings. So, it is never enough to save for retirement. At times like these, look for dividend stocks that can give you long-lasting income. This way, your savings will remain intact, and you can keep earning income.  

How long will the dividend income last? 

To ensure the stock you choose can keep giving you passive income for at least another 30 to 50 years, look at its business model for the following answers. 

  • Has that business model given sustainable cash flows for more than two decades? 
  • Has the company withstood the economic crisis and still paid dividends? 
  • Does the company have assured cash flows and sufficient cash buffers to fund dividends in crises? 
  • And the final question is, can the company sustain its cash flows for another three decades? 

You cannot be sure about the future. The best prediction that you can make is that of three years. Hence, I suggest making an educated guess in the long term and preparing for a fallback. Here are two dividend stocks that could bolster your retirement with long-lasting income. 

Enbridge stock 

Enbridge (TSX:ENB) is a no-brainer passive income stock for retirement. The company has the largest pipeline infrastructure in North America that connects Canada and America, facilitating the export of oil and natural gas. It has a robust business model whereby it has supply contracts for over 90% of its pipelines and collects toll money for transmitting oil and gas. The energy infrastructure giant spends money on expanding, maintaining and developing pipelines. The pipeline company keeps revising toll money for inflation and ensures regular cash flows. With every new pipeline, cash flows increase. 

Enbridge is expanding rapidly to tap North America’s liquefied natural gas (LNG) exports. Consequently, its dividend growth has slowed from 10% before 2020 to 3% in the last three years. Once these new pipelines come online, they could add significantly to Enbridge’s future cash flows and make up for the decelerating oil industry.

For the dividend, Enbridge calculates its distributable cash flow (DCF) after deducting capital expenditure and the debt payment amount. From this DCF, it pays out only 60–70% as dividends and keeps the remaining in reserve for difficult times. These reserves have helped Enbridge grow its dividends for the last 28 years, even during the pandemic, 2014 oil crisis, and 2008 financial crisis. 

Given its shift to LNG, and pipelines becoming scarcer, Enbridge can continue paying dividends for a long time as it has for the last 68 years. Even if ENB doesn’t grow its dividend, it can sustain its dividend per share. 

BCE stock 

BCE (TSX:BCE) has a robust business model whereby its subscriptions continue to earn reliable cash flows. But unlike Enbridge, BCE has to upgrade its telecom infrastructure once a decade, and that is expensive. However, every upgrade brings in higher cash flows that pay up for the capital spent on the upgrade and also for the incremental dividend. The 5G infrastructure rollout will bring significant growth opportunities through scale, Internet of Things (IoT) devices, more average revenue per user, and more subscribers. 

BCE took a beating in the 2008 financial crisis that forced it to pause dividend growth. But once it recovered, BCE grew dividends for 13 years straight. Now it is feeling the pressure of rising interest rates and weakness in its media segment. Its free cash flows (FCF) fell rapidly in the first half. But the company expects to make up for the fall in the second half and grow its 2023 FCF by 2–10%. 

BCE has been paying dividends for 40 years without any dividend cuts and can continue paying dividends for a long time as communication becomes a necessity in the digital economy. 

Bolster your retirement with these dividend stocks 

These two stocks are trading closer to their 52-week low. If you invest $40,000–$50,000 in each of the two stocks, you can lock in a yield of over 7% and get $2,800–$3,500 in annual passive income. 

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