Global markets are reeling ever since the U.S.-initiated tariff wars have altered global economic and political ties. Investors are obviously worried and have many questions. This makes maximizing investment vehicles like the tax-free savings account (TFSA) even more crucial. Which dividend stocks should we invest in for low-risk, worry-free income?
Read on as I discuss three reliable dividend stocks to buy for your TFSA.
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Altagas: Add this 3.2% yielder to your TFSA
As a North American energy infrastructure company, Altagas Ltd. (TSX:ALA) has a bright future. This is because the company is benefitting from a strong utility business as well as a strong midstream business.
In fact, these businesses complement each other well, with the utility business providing a purely defensive cash flow profile, and the midstream business providing more growth in the long term. In Altagas’ latest quarter, the utility business accounted for 64% of its earnings before interest, taxes, depreciation, and amortization (EBITDA). The midstream business accounted for 35% of EBITDA in the quarter.
Looking ahead, Altagas’ cash flows will continue to be reliable and safe, as they are derived from reliable and safe sources. In the utilities segment, Altagas is continuing its modernization program. This will bring rate increases and an expanded network. In the midstream segment, demand is expected to remain strong, as Canadian LNG is becoming increasingly valued in today’s tumultuous environment.
Altagas’ dividend yield is currently 3.2%.
Fortis: A 50-year dividend history
As Canada’s leading utility company, Fortis Inc. (TSX:FTS) is a definite must-own for worry-free dividend income. In fact, Fortis has a 50-year track record of annual dividend increases and a revenue base that’s regulated. This translates into a highly predictable revenue and cash flow stream, which in turn translates into worry-free dividends for shareholders.
Looking ahead, Fortis’ capital spending plan is $26 billion for the 2025 to 2029 time period. This plan is driven by investments related to resiliency of the network and growth at Fortis Alberta. These investments are low risk and highly executable, with nearly all being related to regulated growth and only 23% of them on major projects.
Also, the company is forecasting a 4% to 6% average annual dividend growth rate to the year 2028. This guidance is a strong indicator of the profitability and predictability of the business. Fortis stock currently has a dividend yield of 3.7%.
Tourmaline: Strong dividend growth/yield
My last recommendation is one that’s a little riskier than the other two. In my view, however, it’s a calculated risk that is well worth taking. As you know, Tourmaline Oil Corp. (TSX:TOU) is Canada’s largest natural gas producer with significant exposure to the growing liquified natural gas (LNG) industry.
In fact, business has been booming for Tourmaline. And this has prompted major dividend increases in recent years. In fact, Tourmaline paid out record dividends in 2024 – a regular dividend of $1.40 per share along with special dividends totaling $2 per share. This brought the company’s dividend yield to an impressive 5.5% based on today’s share price.
Today, Tourmaline’s dividend yield is a generous 3.3%. And I believe that this dividend is quite safe for a couple of primary reasons. First of all, the outlook for natural gas is strong, with significant demand expected from global energy customers. Secondly, Tourmaline continues to be a low-cost producer with access to LNG terminals, and this is solidifying the company’s positive outlook.
The bottom line
In conclusion, investing your TFSA funds in the dividend stocks that I discussed in this article will very likely give you access to worry-free dividend income for years to come.
