TFSA Passive Income: 4 Stocks to Buy and Never Sell

Dividend stocks such as 6.9% yielding Telus are ideal choices for long-term, reliable TFSA passive income.

“If you don’t find a way to make money while you sleep, you will work until you die”. This quote from Warren Buffett highlights the importance of passive income. Setting up this stream of income within our TFSA has the added benefit of making it tax-free.

In truth, passive income becomes increasingly important as we approach retirement. It promises to set us up with steady and consistent income, supporting our retirement needs and dreams. So, let’s find passive income that’s dependable, reliable, and growing.

Here are four passive income ideas to buy in your TFSA today.

The TFSA is a powerful savings vehicle for Canadians who are saving for retirement.

Source: Getty Images

Fortis

My first passive income idea is the safest of the safe, Fortis Inc. (TSX: FTS). As a utility company with a regulated revenue stream, Fortis’ dividend can be relied upon. In fact, this is evident in Fortis’ dividend history – 50 years of annual dividend increases.

Today, Fortis stock is yielding a generous 3.9%. Looking ahead, a 4% to 6% average annual dividend growth rate to the year 2028 is expected, continuing in the tradition of dividend growth and predictability. 

We will need energy to power our lives in all scenarios and indefinitely. This leaves Fortis well-positioned to continue to generate passive income for its shareholders.

Altagas

Altagas Ltd. (TSX: ALA) is another dividend stock that’s ideal for passive income. This is because Altagas has the predictability of a utility company with added growth from its midstream business. Essentially, the company is underpinned by the safety of its regulated utilities business, which supports the rapid growth of its global exports business.

In fact, annual revenue has increased 137%, or at a compound annual growth rate (CAGR) of 19% since 2019. Also, the company’s cash flow from operations has grown at 81%, or a CAGR of 13% in this same time period.

The rapid growth of Altagas’ business is evidenced by these results. But let’s also take a look at its dividend. Since 2019, Altagas’ annual dividend has increased 272%, or at a CAGR of 30% – and its dividend yield is currently an attractive 3.5%.  

Telus

Telus Corp. (TSX: T), Canada’s unique telecommunications giant, has a strong history of shareholder returns. The company generates more than $20 billion in annual revenue from its wireless, data, IP, voice, television, entertainment, video, and security segments.

Since 2019 Telus has grown its annual revenue by 37% to more than $20 billion in 2023. This growth that Telus has experienced has also been accompanied by a healthy 33% dividend growth rate since 2019. The stock is currently yielding a very generous 6.9% and is backed by a strong balance sheet and steady growth.

Intact Financial

Intact Financial Corp. (TSX: IFC) is the largest provider of property and casualty insurance in Canada.

Over recent years, Intact has grown by consolidating its industry. In fact, the company has made countless acquisitions over the years. This has led to a steady rise in revenue and the realization of cost synergies. For example, since 2019, the company’s annual revenue has increased 126% to $25.7 billion in 2023.

In turn, this has led to a rapid increase in Intact’s dividend. In this same five-year time period, the company’s annual dividend increased 59% to the current $4.80. Finally, as you can see from the above graph, Intact Financial’s stock price has outperformed as the company has continued to rapidly grow in both size and profitability.

The bottom line

The four stocks discussed in this article are all solid dividend stocks to rely on for passive income. They share a level of security, predictability, and dividend growth that make them ideal TFSA stocks.

Fool contributor Karen Thomas has no position in any of the stocks mentioned. The Motley Fool recommends Fortis, Intact Financial, and TELUS. The Motley Fool has a disclosure policy.

More on Dividend Stocks

woman relaxes with phone
Dividend Stocks

Telus Dividend Reliability: Is the Telecom Still Worth Holding?

Telus (TSX:T) stock might be a falling knife, but the shares still look like a dividend deal going into November…

Read more »

Utility, wind power
Dividend Stocks

I Keep Coming Back to This 5.6% Dividend Stock

Brookfield Renewable offers a 5.6% yield and targets 10%+ FFO growth. Here is what management said, plus risks every Canadian…

Read more »

hand stacks coins
Dividend Stocks

I Split $20,000 Across 3 TSX Stocks for $715 a Year in Passive Income: Here Are the Picks

With their reliable cash flows, consistent dividend growth, and strong long-term growth prospects, these three TSX stocks could help investors…

Read more »

concept of real estate evaluation
Dividend Stocks

A Tailor-Made TFSA Stock: An 8.3% Yield With Monthly Paycheques

A non-bank lender paying monthly dividends, including year-end special dividends, is tailor-made for a TFSA.

Read more »

Train cars pass over trestle bridge in the mountains
Dividend Stocks

CN Stock Looks Like a Buy After Raising Its 2026 Outlook

CN stock has a stronger 2026 outlook and a 2.2% dividend yield. Here’s what supports the buying case and what…

Read more »

woman considering the future
Dividend Stocks

For Retirement Planning, How Much Goes in the RRSP and How Much in the TFSA?

To build tax-efficient retirement wealth, Canadians must know when to prioritize the RRSP over the TFSA, and vice-versa.

Read more »

Blocks conceptualizing Canada's Tax Free Savings Account
Dividend Stocks

How I’d Structure a $25,000 TFSA for Steady Income, Stock by Stock

Building a TFSA stock portfolio around balance, sustainability, and capital protection is the key to generating steady, tax-free income.

Read more »

Bank of Canada Governor Tiff Macklem
Dividend Stocks

Bank of Canada’s Rate Decision Is Less Than 2 Weeks Away: 3 TSX Stocks to Watch

The Bank of Canada's rate decision is approaching. Here is what investors should watch at Scotiabank, RioCan and Fortis before…

Read more »