2 TSX Stocks That Could Turn $20K Into Decades of Reliable Income

Putting $20,000 to work in high-quality dividend stocks can be a solid strategy to build a reliable long-term income stream. The key is to focus on established companies listed on the TSX that have a proven record of paying dividends and the financial strength to sustain and grow those payments in the years ahead. When dividends are supported by strong cash flows and sound balance sheets, they can provide both stability and peace of mind for income-focused investors.

Moreover, instead of using dividend income immediately, reinvesting those payments allows compounding to do the heavy lifting. Each dividend buys additional shares, which in turn generate higher dividend income in the future. Over time, this strategy can significantly accelerate portfolio growth and income.

Against this background, here are two TSX stocks that could turn your initial $20K investment into decades of reliable income.

Reliable income stocks #1: Enbridge

Enbridge (TSX:ENB) is a must-have stock in any income portfolio. It has paid and increased its dividends for decades, even amid economic downturns. Moreover, ENB stock offers an attractive yield and maintains a sustainable payout ratio, making it a compelling income stock.

Enbridge announced a 3% increase to its quarterly dividend in December 2025, bringing the annual payout to $3.88. This increase marked Enbridge’s 31st consecutive year of dividend growth.

The energy infrastructure company generates steady earnings and distributable cash flow (DCF) largely from regulated assets and long-term contracts. This structure shields cash flows from short-term swings in oil and gas prices, allowing Enbridge to deliver predictable results even during periods of market stress. Its extensive pipeline network continues to operate at high utilization rates, producing stable, recurring returns year after year.

A significant portion of Enbridge’s earnings is further protected by regulation and inflation-linked mechanisms. Approximately 80% of its cash flow benefits from frameworks that provide visibility and built-in cost recovery, helping preserve margins in a rising-cost environment. This predictability enables management to maintain a disciplined payout strategy, targeting a sustainable dividend payout ratio of 60% to 70% of DCF.

Looking ahead, Enbridge appears well-positioned to maintain steady growth. Its diversified portfolio of liquid pipelines, natural gas transmission assets, and utility operations should continue to provide a solid earnings base. At the same time, investments in renewable power and low-carbon initiatives offer exposure to the global shift toward cleaner energy sources.

Management expects mid-single-digit growth in earnings and distributable cash flow over the medium term, which should comfortably support ongoing dividend increases of up to 5% annually.

Reliable income stocks #2:  Canadian Utilities

Utility companies are among the top investments for investors seeking reliable income. Their defensive, regulated business models and predictable cash flow support higher dividend payments year after year.

Within this space, Canadian Utilities (TSX:CU) is an attractive investment option. CU stock has increased its dividend for 53 consecutive years, the longest track record of dividend growth among any publicly traded Canadian company. Its reliable payouts are backed by a highly contracted and regulated earnings base, which provides visibility and stability to cash flows.

Canadian Utilities has consistently invested to increase its rate base, supporting earnings growth and dividend increases. Looking ahead, the company plans to invest $6.1 billion in regulated utilities between 2025 and 2027, further strengthening its long-term cash flow profile.

Beyond its core regulated assets, Canadian Utilities is also expanding into electricity generation, cleaner fuels, and energy storage. These initiatives add diversification and enhance its long-term growth potential, strengthening its appeal as a dependable dividend stock.

Generate over $1,037/year in reliable income

Enbridge and Canadian Utilities are two attractive options for investors seeking reliable income for decades. Both offer sustainable yields and are likely to increase their dividends in the coming years.

An investment of $20,000, distributed evenly between Enbridge and Canadian Utilities, could generate $1,037.64 per year in dividend income.

CompanyRecent PriceNumber of SharesDividendTotal PayoutsFrequencyEnbridge$64.071560.97151.32QuarterlyCanadian Utilities$42.21236$0.458108.09QuarterlyPrice as of 01/05/2026

The post 2 TSX Stocks That Could Turn $20K Into Decades of Reliable Income appeared first on The Motley Fool Canada.

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More reading

• The Top 3 Canadian Dividend Stocks I’d Tell Anyone to Buy
• Protect Your Tax-Free Earnings: 2 TFSA Stocks to Buy Beyond the Boom
• If Growth Is Your Game, We Have the Name of the Dividend Stock for You
• 2 Stocks Worth Buying and Holding in a TFSA Right Now
• 3 Dividend-Growing Canadian Stocks for Passive Income

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.