For retirees or those planning their retirement, stocks that pay their dividends monthly are particularly attractive investments.

The risk with these stocks is they have very high payout ratios, or the amount of dividends they pay relative to their earnings. They can't afford to have anything go wrong because there is little room to maneuver. The pandemic has exposed the fault lines for many dividend payers, whether they pay monthly, quarterly, or at some other interval.

That's why investors looking for monthly cash flows need to focus on the very best dividend stocks to minimize the risks inherent in these niche stocks. Below are three that ought to be considered for such a portfolio.

Coins stacked under a rising arrow

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Enerplus 

It's not surprising the turmoil of the energy industry has rocked Canadian oil and gas producer Enerplus (NYSE:ERF). When industry giants such as ExxonMobil, Shell, and BP are all falling, a smaller player like Enerplus will be down too.

And not without good reason. First-quarter earnings earlier this month plunged 68% to $0.07 per share, which was below analyst expectations of $0.11 per share. But Enerplus has drastically cut its capital expenditures for the year to preserve its liquidity, suspended all drilling in North Dakota, and temporarily shut-in certain wells (which stops them from producing) across its Williston basin and Canadian operations.

The energy producer has a strong balance sheet with little debt maturing near-term, which enables it to continue supporting its monthly dividend payment. Although the energy industry is in turmoil, Enerplus has prioritized preserving its balance sheet and producing free cash flow based on West Texas Intermediate (WTI) oil prices of $35 per barrel. WTI has bounced back from its recent plunge and now goes for around $32 a barrel

With its stock 66% below the 52-week high of almost $8.50 per share hit last September -- or even the $7 level it was trading at just before the COVID-19 outbreak struck -- investors have an opportunity to realize significant capital appreciation with Enerplus while continuing to receive their monthly dividend check.

Main Street Capital 

While getting in on the ground floor of a company isn't necessary to profit handsomely, being able to buy Microsoft or Apple back when they were fledgling companies would have allowed investors to capture the greatest growth and maximal profits possible. 

Business development companies, or BDCs, do just that, as they invest early on in a growth company's business cycle and capitalize on its potential. Publicly traded private equity firms like Main Street Capital (NYSE:MAIN) combine the best of these two worlds, as they allow investors to join in on the search for tomorrow's hot business today.

Main Street Capital provides equity and debt financing to lower middle-market companies (businesses with revenue between $10 million and $150 million) and debt financing to middle-market companies (revenue between $150 million and $1.5 billion).

The BDC keep its monthly payout relatively low, a conservative policy based on the variable nature of its earnings, but twice annually it pays out a special dividend to ensure it complies with rules saying it must pay out 90% of its profits.

Main Street Capital has a solid record of achievement in finding businesses in which to invest, and since 2015 has grown its net investment income by an average compounded annual rate of 10.1% annually. With the economy reopening, now may be a good time to bet on "Main Street" businesses too.

Realty Income 

High on the every monthly dividend investors list is Realty Income (NYSE:O), a commercial real estate investment trust (REIT). 

Although real estate might seem a bit dodgy at the moment, considering numerous retailers went on a rent strike, some are starting to go under, and shopping malls face declining foot traffic and disappearing tenants, Realty Income's properties are spread over 300 companies across 50 different industries, ensuring it has sufficient diversity to withstand downturns in various sectors. Importantly, no one tenant represents 10% or more of its assets.

Realty Income also has the distinction of belonging to the S&P 500 Dividend Aristocrats index, which recognizes companies that have raised their dividend every year for at least 25 years. 

Since its formation in 1994, this has been a quality REIT, a top-notch monthly dividend stock, and an overall solid investment, and should continue to perform like one in the future.