Where to Invest Your 2025 TFSA Money for Total Returns

These TSX stocks offer high growth and steady dividend income, making them top bets to generate solid total returns.

Investing in stocks offering solid total returns—a combination of stock price appreciation and dividends is a powerful strategy to build wealth over time. Thankfully, the TSX has several fundamentally strong stocks offering growth and income. Moreover, investing in these stocks via the Tax-Free Savings Account (TFSA) can significantly enhance your returns. TFSA is an exceptional tool for compounding your wealth over time without the drag of taxes eating into your returns.

With this background, here are three Canadian stocks to invest your TFSA money in 2025.

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Canadian Natural Resources stock

Canadian Natural Resources (TSX: CNQ) could be a solid addition to your portfolio for generating stellar total returns. This Canadian oil and gas producer is known for generating strong earnings and cash flows that support its dividend payments and stock prices.

It’s worth noting that Canadian Natural Resources has been consistently increasing its dividends. For instance, it has raised its dividend for 25 consecutive years. Over this period, the company’s dividend grew at a compound annual growth rate (CAGR) of 21%.  

Besides higher dividend payments, Canadian Natural Resources stock has grown at a CAGR of about 24% in the last five years, delivering overall capital gains of about 194.6%.

Canadian Natural Resources’s long-life, low-decline assets, operating efficiency, and strong balance sheet position it well to grow its earnings. This will support its higher payouts and stock price. Moreover, its well-balanced production, focus on strategic acquisitions, and opportunities from low-capital, high-growth projects further enhance its ability to generate sustainable cash flows. These factors provide a solid base for growth.

Canadian Natural Resources offers a quarterly dividend of $0.563 per share, translating to a yield of 4.6%. Importantly, its payouts are backed by sustainable free cash flow, making it a dependable bet for investors looking for solid total returns.

Brookfield Asset Management stock

Brookfield Asset Management (TSX: BAM) is a compelling investment for investors looking for income and growth. This alternative asset manager is positioned to capitalize on tailwinds from the energy transition, artificial intelligence (AI) infrastructure, and credit markets.

Brookfield’s early investments in sectors such as data centres, renewable power, nuclear energy, and semiconductor manufacturing have anchored its growth trajectory. These industries are experiencing long-term investment cycles, providing a solid foundation for growth.

Thanks to the company’s asset-light model, focus on high-quality investments, exposure to fast-growing sectors, and focus on enhancing shareholder value, Brookfield Asset Management stock has surged over 58% in the past year. Moreover, it offers an attractive yield of 2.7%.

The company’s payouts are supported by its fee-related income, which adds stability. Moreover, the company is focusing on growing fee-bearing capital, which will boost its earnings and support higher payouts in the coming years.

Alimentation Couche-Tard

Canadian investors could consider Alimentation Couche-Tard (TSX: ATD) for their TFSA portfolio. It operates a network of convenience stores, supplies fuel, and offers electric vehicle (EV) charging. Thanks to its diversified revenue base and value proposition, Alimentation Couche-Tard consistently delivers solid financials, which enables it to grow its dividends and supports its share price.

Couche-Tard’s revenues grew at a CAGR of 6.2% over the past decade. At the same time, its per-share earnings increased at a CAGR of 15.2%. Thanks to its growing earnings base, Couche-Tard’s stock price climbed over 94% over the past five years, generating an average annualized return of 14.2%.

Moreover, the retailer’s solid earnings growth enables it to return higher cash. Notably, its dividends grew at a CAGR of 25.6% in the last 10 years.

Couche-Tard’s extensive network of stores, increased penetration of private-label products, and value proposition will likely drive its financials. Further, its expanding EV charging footprint, strategic acquisitions, and customer loyalty augur well for future growth.

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alimentation Couche-Tard. The Motley Fool recommends Brookfield Asset Management and Canadian Natural Resources. The Motley Fool has a disclosure policy.

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