TFSA Investors: Where To Invest Your $6,500 Room

Do you have unused TFSA contribution room? Consider investing in these TSX stocks now.

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Where to Invest?

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The TFSA (Tax-Free Savings Account) is a smart tool to invest for the long term. Since capital gains and dividends are tax-free, a TFSA significantly enhances your real returns from equities, especially in the long term. Even though the short-term economic outlook remains bleak, stocks remain one of the top investments in a TFSA due to their potential to deliver stellar returns. 

If you have unused $6,500 TFSA contribution room, consider allocating the funds to top Canadian stocks that are fundamentally strong, trading cheap, and offer solid growth potential. 

In this article, I’ll discuss three such top-quality TSX stocks that can generate solid tax-free capital gains in the long term. 


e-commerce giant Shopify (TSX:SHOP) is undoubtedly a solid long-term stock that should be a part of your TFSA portfolio. This technology stock lost substantial value as investors turned risk-averse amid rising interest rates and high inflation. Nonetheless, Shopify’s long-term fundamentals remain strong, and the recent correction is an opportunity to go long on this company. 

Investors should note that Shopify continues to produce strong sales despite tough year-over-year comparisons. Shopify’s top line increased by 85% and 57% in 2020 and 2021, respectively. Despite this high base, the company managed to generate sales growth of 21% in 2022, which is incredible.

Shopify is poised to benefit from its aggressive investments in its e-commerce platform. Its products like POS (Point-of-Sale), Capital, and Markets are witnessing strong adoption. Moreover, the e-commerce platform’s offline payment offerings have also seen solid demand. Also, the strengthening of its fulfillment offerings and addition of sales and marketing channels bode well for growth. Shopify stock is trading at a forward enterprise value/sales multiple of 8.2, which is at a multi-year low, providing an excellent buying opportunity near the current levels. 


Dollarama (TSX:DOL) offers a unique mix of growth and stability, making it a solid stock for your TFSA portfolio for all market conditions. This large-cap consumer company has consistently delivered double-digit sales and earnings growth on the back of its value proposition. 

For instance, Dollarama’s sales have grown at an average annualized rate of 11% since 2011. At the same time, this retailer’s earnings had a CAGR (compound annual growth rate) of 17%. Dollarama’s attractive growth reflects its strategy of offering consumable products at low fixed prices. Further, its extensive store base and solid product mix support its top line. 

Dollarama’s value pricing, growing store base, international expansion, and cost-saving initiatives position it well to deliver outsized returns. 

WELL Health

Investors could consider adding digital health company WELL Health (TSX:WELL) to their TFSA portfolio near the current levels. Trading at a forward enterprise value/sales ratio of 2.3, WELL Health stock looks incredibly cheap. Moreover, it continues to grow fast with increased contributions from its high margin Virtual Services business. 

WELL Health is well-positioned to deliver robust sales growth, reflecting higher omnichannel patient visits. Moreover, the ongoing strength in its Virtual Services segment and strong organic sales bode well for profitable growth in the future. 

In addition, WELL Health’s focus on strategic acquisitions will likely accelerate its growth and strengthen its competitive positioning in the North American market. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

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

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