TFSA Investors: Create $313 in Passive Income by Buying in 114 Shares in 3 Dividend Stocks

Canadian investors seeking passive income from dividend stocks should think beyond the first year, but here is what you could get right now!

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The Tax-Free Savings Account (TFSA) is probably the perfect place for investors wanting to create a passive-income portfolio. It can be taken out any time you need, with contribution limits rising each year. If you were 18 in 2009 or earlier, then you have a total of $88,000 in contribution room in 2023!

The thing is, there are two ways to go about investing for passive income. There’s trying to create insane wealth right away, which means a lot of cash upfront. It also means not creating a diversified portfolio in many cases, as you’re sinking far more cash into one stock.

Instead, consider a smaller, long-term investment in these three dividend stocks.

The dividend stocks I’d go with on the TSX today

The TSX today offers a lot of deals, but if you’re a long-term holder, you want a deal that turns into solid cash flow. So, I would consider dividend stocks in the utility, banking, and telecommunications sectors. These are all solid and growing industries that will continue to thrive in the decades to come.

The three dividend stocks I would go on to consider today are Bank of Nova Scotia (TSX:BNS), Hydro One (TSX:H), and BCE (TSX:BCE) on the TSX today. Each are at the top of their game, while also providing downturn protection.

Scotiabank stock invests not just in Canada, but in emerging markets in Latin and Central America as well. It pretty much stays out of the United States, which ends up being a good thing during recessions. It currently offers a dividend yield at 6.3%.

Hydro One stock is in the utility sector with less time behind it but certainly more gains. It already provides renewable utilities to Canada’s most populated province of Ontario, with more expansion right now as well. Utility stocks are a safe choice during downturns. Hydro One holds a dividend yield at 3.07%.

Finally, BCE stock continues to be the largest of the telecommunications stocks out there. It’s also the oldest, providing decades of share growth as well as future growth in the wireless industry. It currently also holds a dividend yield at 6.26%.

How much you could make

Let’s say you have $6,000 you want to divide between these three dividend stocks today. That’s $2,000 per stock, and you’ll collect dividends over the next few years. You can reinvest those dividends over the next five years as well, creating a larger and larger portfolio for passive income.

For now, though, let’s look at how much passive income you could make annually from investing $6,000 in these stocks right now.


In total, by buying today, you’ll already have a portfolio at $6,312.92! That’s total passive income of $312.92 each year starting now, without even reinvesting your dividend income. Get started now, and it could create riches over the next decade and beyond.

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 Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Bank Of Nova Scotia. The Motley Fool has a disclosure policy.

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