DIY Investors: How to Build a Stable Income Portfolio Starting With $50,000

Canadian DIY investors with an extra $50,000 or so in new money to put to work have plenty of options. And while the TSX Index is coming into 2026 hot, I wouldn’t hit the panic button over the next stock market correction. Undoubtedly, one should always be prepared in any given year, and the key isn’t timing when it’ll start, but having a game plan for how to react once stocks inevitably do start putting together nasty losing streaks.

When it comes to a considerable sum (let’s say in the five figures), I’m an advocate of dollar-cost avereraging (or incremental buying through the course of a year), rather than putting everything to work at one instance in time, especially if the broad equity markets are close to a new all-time high and we’re fresh off one of the best return years in recent memory. Of course, dollar-cost averaging isn’t a magic formula for good returns. In fact, if stocks continue to roar higher with this kind of momentum, putting a lump sum into stocks at once might outpace an incremental buying approach.

Indeed, there are trade-offs to consider. For investors who don’t have liquidity beyond the amount they’re looking to invest, though, I’d view the dollar-cost averaging approach as a way to calm one’s nerves if the perception of a correction is high or if one doesn’t have liquidity to be a net buyer on such a dip. Of course, it all comes down to one’s comfort level.

Incremental buying could make more sense when dealing with large sums

For a relatively new investor, the pros (less panic) of incremental buying, I think, outweigh the potential negatives. That said, if 2025 wasn’t a red-hot year for the TSX Index and we’re in the midst of a bear market, perhaps the lump-sum approach would have proven better. In any case, investors keen on formulating a passive income stream may wish to steadily add to their holdings over time.

If you’re looking to average a 4% yield, a $50,000 portfolio would payout $2,000 before taxes. Of course, if you’re in a TFSA, that’d be tax-free income. Either way, backing up the truck on a 4%-yielder at one instance may be the best way to lock in that yield. However, incremental buyers willing to average up their yield may wish to build such a passive income stream over time.

As you may know, the yield goes higher when share prices move lower, so when it comes to an income stream, a dollar-cost averaging approach could prove wise, especially if the market is expensive and some froth needs to come off the top of some of the names (most notably the big Canadian banks, which have endured yield compression in the past year as a result of big capital gains in 2025).

What about Telus’ huge yield?

For investors seeking higher yields, a name like Telus (TSX:T) could be a worthy option, given its yield is around 9.3%. And with a dividend growth pause and plenty of efforts to improve the cash flows, I do find the battered telecom to be intriguing for those risk-takers who prioritize income over growth, even if it means tackling serious volatility.

Either way, Telus shares have been gaining in recent sessions, and if the dividend does survive, nibbling on the stock while the yield’s still above 9% could make sense. Given the annual income from $50,000, the stock could work out to more than $4,500 in annual income.

That’s a great deal, but investors should be cautious about putting too much to work at any given time, as there are dividend cut risks and capital downside to be concerned about. Either way, for stability, I’d be an incremental buyer of Telus’ diversified dividend (in small doses) with yields in the 3–4% range.

The post DIY Investors: How to Build a Stable Income Portfolio Starting With $50,000 appeared first on The Motley Fool Canada.

Should you invest $1,000 in TELUS right now?

Before you buy stock in TELUS, consider this:

The Motley Fool Stock Advisor Canada analyst team identified what they believe are the 5 best stocks for investors to buy now… and TELUS wasn’t one of them. The 5 stocks that made the cut could potentially produce monster returns in the coming years.

Consider MercadoLibre, which we first recommended on January 8, 2014 … if you invested $1,000 in the “eBay of Latin America” at the time of our recommendation, you’d have $20,568.17!*

Now, it’s worth noting Stock Advisor Canada’s total average return is 99%* – a market-crushing outperformance compared to 77%* for the S&P/TSX Composite Index. Don’t miss out on our top 5 list, available when you join Stock Advisor Canada.

See the 5 Stocks #start_btn6 { background: #0e6d04 none repeat scroll 0 0; color: #fff; font-size: 1.2em; font-family: 'Montserrat', sans-serif; font-weight: 600; height: auto; line-height: 1.2em; margin: 30px 0; max-width: 350px; text-align: center; width: auto; box-shadow: 0 1px 0 rgba(0, 0, 0, 0.5), 0 1px 0 #fff inset, 0 0 2px rgba(0, 0, 0, 0.2); border-radius: 5px; } #start_btn6 a { color: #fff; display: block; padding: 20px; padding-right:1em; padding-left:1em; } #start_btn6 a:hover { background: #FFE300 none repeat scroll 0 0; color: #000; } @media (max-width: 480px) { div#start_btn6 { font-size:1.1em; max-width: 320px;} } margin_bottom_5 { margin-bottom:5px; } margin_top_10 { margin-top:10px; }

* Returns as of January 5th, 2026

More reading

• New Year, New Income: How to Aim for $300 a Month in Tax-Free Dividends
• The Smartest Dividend Stocks to Buy With $500 Right Now
• The Least Sexy Stocks for 2026 (Don’t Even Think About Buying These Unless You Want to Make Money)
• Sure, Telus Paused Its Payout: It’s My Newest Top Stock Pick
• How I’d Structure My TFSA With $14,000 for Consistent Monthly Income

Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends TELUS. The Motley Fool has a disclosure policy.