All it Takes Is $5,000 Invested in Each of These 3 Dividend Stocks to Help Generate $978 in Passive Income in 2026

By Sneha Nahata at The Motley Fool Canada

Investing even modest sums, such as $5,000, in high-quality dividend stocks can help investors generate a steady stream of passive income in 2026 and beyond. Dividend-paying companies with strong fundamentals, stable cash flows, and a consistent track record of returning capital to shareholders can provide reliable income while also offering the potential for long-term capital appreciation.

When selecting dividend stocks, investors should focus on businesses with resilient payouts and the financial strength to sustain and grow their dividends over time. Companies with dependable earnings and the ability to expand profitably remain well-positioned to sustain their payouts across different market environments.

In addition, Canadian stocks offering attractive yields can further enhance a portfolio’s income potential. By allocating capital to established Canadian companies with durable business models and appealing dividend yields, investors can build a foundation for consistent passive income.

Against this backdrop, here are three Canadian dividend stocks that could help generate over $978 in passive income in 2026.

Passive-income stock #1: Firm Capital Mortgage Investment Corporation

Firm Capital Mortgage Investment Corporation (TSX:FC) is an attractive stock to generate passive income. The company operates as a non-bank lender, focusing primarily on short-term residential and commercial real estate mortgage loans as well as other real estate-related debt investments. Its emphasis on short-duration lending and conservative underwriting approach is designed to protect capital while delivering consistent returns.

Notably, the financial services company has a long record of uninterrupted dividend payments. Shareholders currently receive a monthly dividend of $0.078 per share, yielding approximately 7.7%. Moreover, the company provides a special year-end dividend, further enhancing total income for investors.

Its payouts are supported by a diversified loan portfolio with meaningful exposure to resilient real estate sectors, including residential construction and land development. Moreover, its recurring lending fees and steady interest income support steady payouts and position it well to sustain its future dividend payments.

Passive-income stock #2: SmartCentres REIT

SmartCentres REIT (TSX: SRU.UN) is a dependable high-yield dividend stock for passive-income investors. It currently distributes $0.154 per unit each month, offering an annual yield of about 6.7%. Its reliable payouts are supported by steady operating performance and a portfolio of high-quality real estate, much of it located in prime retail areas that attract strong leasing demand and renewals.

These properties, primarily retail-focused, witness high occupancy and generate consistent rental income. By the end of 2025, SmartCentres REIT’s occupancy stood at 98.6%, reflecting strong demand for its space. Lease renewals delivered 8.4% rental growth excluding anchor tenants, and rent collection exceeded 99%.

With significant land holdings and an expanding mixed-use development pipeline, SmartCentres appears well-positioned to sustain long-term growth while maintaining its reliable dividends.

Passive-income stock #3: Dream Industrial REIT

Dream Industrial REIT (TSX:DIR.UN) is another top stock to generate passive income in 2026. The REIT focuses on industrial properties, particularly urban logistics and distribution facilities, benefiting from long-term demand driven by e-commerce and supply chain infrastructure.

Its diversified tenant base across multiple industries reduces reliance on any single customer and helps maintain stable rental income during economic fluctuations. Strong leasing demand has supported high occupancy and rising rental rates, strengthening property income and helping sustain consistent dividend payments.

The REIT currently pays $0.058 per unit monthly, yielding about 5.3%. With occupancy around 96%, solid tenant retention, and strengthening leasing activity since late 2025, operating momentum remains positive. Moreover, its long-term growth is likely to be supported by initiatives such as solar energy projects, a private capital platform, and reinvestment in high-quality urban industrial assets.

Earn about $1,200 per year in passive income

A $5,000 investment spread across Firm Capital, SmartCentres REIT, and Dream Industrial REIT can help diversify your portfolio while creating a consistent stream of passive income. With these investments, you could earn roughly $81.53 in monthly income, about $978.36 annually, making them a solid option for investors seeking both diversification and reliable passive income.

The post All it Takes Is $5,000 Invested in Each of These 3 Dividend Stocks to Help Generate $978 in Passive Income in 2026 appeared first on The Motley Fool Canada.

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Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Dream Industrial Real Estate Investment Trust and SmartCentres Real Estate Investment Trust. The Motley Fool has a disclosure policy.

2026