Retirement Made Easier: TFSA Stocks for a Stress-Free Future

These fundamentally strong Canadian TFSA stocks with dividends look like a steal to buy now and hold forever.

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Retirement

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If you’re investing in the stock market to make your life after retirement easier by gaining financial freedom, you should ideally stick to large-cap dividend stocks with well-proven business models. Adding such stocks to your TFSA (Tax-Free Savings Account) portfolio at the right time can help you not only earn attractive tax-free returns on investments but also live your post-retirement life stress-free with dividend income.

In this article, I’ll talk about two of my favourite evergreen TFSA Stocks you can buy now and hold for the long term and give a boost to your retirement planning portfolio.

Enbridge stock

Enbridge (TSX:ENB) could arguably be one of the most trustworthy dividend stocks in Canada to consider for holding in your TFSA forever. This Calgary-headquartered energy transportation and infrastructure giant currently has a market cap of $97.3 billion, as its stock trades at $40.01 per share after witnessing a 9% correction so far in 2023. ENB stock offers a very attractive 7.4% annualized dividend yield at the current market price that can act as a reliable source of passive income for you.

Even as global energy companies continue to struggle with macroeconomic challenges and high volatility in commodity markets, Enbridge’s operational performance has remained largely unaffected.

In the first quarter of 2023, the Canadian energy transportation giant posted record volumes on its mainline with the help of high utilization across its systems. With this, its adjusted earnings grew positively by 1.2% YoY (year over year) to $0.85 per share. Similarly, its adjusted quarterly EBITDA (earnings before interest, taxes, depreciation, and amortization) increased 7.7% YoY to $4.5 billion.

As Enbridge continues accelerating its investments in energy export and renewable power segments to further diversify its revenue streams, you can expect its financial growth to improve in the long term, making it a great Canadian stock to add to your TFSA now.

Scotiabank stock

Bank of Nova Scotia (TSX:BNS) could be another reliable Canadian dividend stock to add to your TFSA portfolio in the second half of 2023, especially after its recent correction. Based on its market capitalization of $75.7 billion, Scotiabank is currently the fourth-largest bank in Canada, as its stock trades at $63.52 after losing more than 28% of its value since the end of 2021. At this market price, it has a 6.7% annualized dividend yield and distributes its dividend payouts every quarter.

Besides the broader market weakness, the negative impact of macroeconomic challenges on the banking sector could be the main factor responsible for BNS stock’s dismal performance in the last few quarters. In the second quarter of its fiscal year 2023 (ended in April), Scotiabank’s revenue remained nearly flat on a YoY basis, while its adjusted quarterly earnings slipped by 22% from a year ago due partly to a decline in net interest income.

Despite the challenging business environment, Scotiabank’s focus on delivering returns to its investors clearly reflects its dividend growth track record. To give you an idea, in five years between its fiscal year 2017 and 2022, the bank raised its annual dividend per share by 33%.

As the economic environment gradually started improving in the coming years, Bank of Nova Scotia’s financial growth trend is likely to strengthen. This expectation should help its share prices recover fast, making it an attractive Canadian dividend stock buy for TFSA holders.

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.

The Motley Fool recommends Bank Of Nova Scotia and Enbridge. The Motley Fool has a disclosure policy. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

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