Have you ever wondered how close you really are to earning reliable monthly income from your Tax-Free Savings Account (TFSA)? With the right strategy and the right stock, it’s more achievable than many think. By investing in high-yield, stable dividend stocks, you can turn your TFSA into a passive income machine that increases your wealth month after month.
While most TSX dividend stocks pay quarterly, a few select companies distribute monthly income, giving you a steady cash flow that aligns with real-life expenses. In this article, I’ll highlight one such top-tier Canadian monthly dividend stock that could be a game-changer for your income portfolio. Later in the article, I’ll show you exactly how much you’d need to invest to generate $1,000 a month in passive income.
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A monthly dividend stock worth considering today
If you want to turn your TFSA into a steady income machine, Whitecap Resources (TSX:WCP) is a stock worth looking at. This Calgary-based oil and gas producer focuses on light oil, natural gas liquids, and condensate-rich gas.
After rallying 18% over the last 30 sessions, WCP stock currently trades at $8.49 per share with a market cap of $10.4 billion. What’s most appealing for income seekers is its monthly dividend, which translates to a juicy 8.6% annualized yield.
The recent lift in this monthly dividend stock came as investors responded positively to its solid quarterly numbers and the successful completion of its strategic combination with Veren.
Delivering results where it counts
This brings us to Whitecap’s financial growth trends, which have been improving across the board. In the first quarter, the company posted $855.2 million in revenue, reflecting a nearly 9% YoY (year-over-year) increase. Its quarterly net profit also nearly tripled from a year ago to $162.6 million.
Last quarter, Whitecap also generated $446 million in funds flow and declared $107 million in dividends. Its free funds flow was solid at $48 million, even after investing heavily in drilling 86 wells during the quarter.
Although the stock might have dipped in recent months, the company is clearly generating strong cash, which helps keep that reliable monthly income stream intact.
The ongoing expansion and growth initiatives
Now, let’s talk about why this stock could be a great buy for TFSA investors aiming to earn $1,000 in monthly dividend income.
Notably, after the recent Veren deal, Whitecap has become the largest Montney and Duvernay landholder in Alberta. It’s already planning new drilling campaigns across its high-return assets, with 67 unconventional wells and nearly 100 conventional wells scheduled for the second half of 2025.
At the same time, it’s reducing debt and managing costs, giving it the flexibility to weather price swings and keep rewarding investors.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | INVESTMENT | DIVIDEND PER SHARE | TOTAL PAYOUT | DIVIDEND FREQUENCY |
| Whitecap Resources | $8.49 | 16,450 | $139,661 | $0.0608 | $1,000.2 | Monthly |
| Prices as of May 22, 2025 |
Foolish takeaway
To generate $1,000 a month in passive income from Whitecap’s monthly dividend, TFSA investors would need to own around 16,450 shares, with an investment of about $139,661 at the current market price. This example should give you a good idea of how easily you can earn passive income in your TFSA each month if you pick the right stock.
That said, I wouldn’t recommend going all in, as putting such a large amount into one or two stocks is too risky. Instead, it’s wiser to diversify across several reliable monthly dividend payers to reduce risk and build a more balanced income-generating portfolio.
