Finding the right mix of investments and starting to invest early can make a huge difference over the longer term. And when it comes to a TFSA approach for Canadian investors, starting early with the right investment is huge.
But where can those new Canadian investors begin? Here’s an ideal TFSA approach for a $21,000 portfolio.
Some disclaimers on your TFSA
For those unfamiliar with the term, TFSA stands for Tax-Free Savings Account. As the name implies, the account is a special type of savings vehicle for Canadian investors.
Contribution limits are set out that allow investors to set aside a certain amount into a TFSA each year. For 2025, that limit is $7,000, but those who have not maxed out their contributions in prior years can carry forward contributions from earlier years.
This means that the cumulative limit since the TFSA’s inception is a whopping $102,000 in 2025.
Where to start on that $21,000-TFSA approach
It can be a daunting ask, particularly for newer Canadian investors, to mention a $21,000 portfolio. Fortunately, it’s a lot easier than most would think to not only establish a portfolio of that size but also to grow it.
The first key point to note is that building any TFSA approach will take time. Starting small and starting early is always key. To reach the $7,000 limit in 2025 through monthly deposits would require a deposit of $583.33 per month.
That’s not always attainable for new investors. Fortunately, a smaller, $300 per month contribution to start can prove to be a great start.
Once the deposits are flowing, picking the right investments can be just as important. And that’s why the trio of Bank of Nova Scotia (TSX:BNS), Enbridge (TSX:ENB), and Fortis (TSX:FTS) are great options to begin with.
Fortis will provide a defensive base
Fortis is one of the largest utility stocks on the market. Utilities generate a recurring revenue stream backed by long-term regulated contracts.
Not only does this make Fortis one of the most defensive picks on the market, but it can also help in a TFSA approach.
That recurring revenue stream leaves room for Fortis to invest in growth initiatives and pay out a juicy quarterly dividend, which can be reinvested.
As of the time of writing, that dividend has a respectable 3.7% yield.
Scotiabank provides a juicy income and growth
Canada’s big bank stocks are always among the best long-term options for any investor. In the case of Scotiabank, the bank is known as Canada’s most international bank.
The big banks generate a recurring and stable revenue stream from the mature and well-regulated market in Canada. This means that international markets have become the primary growth drivers for the banks.
Scotiabank’s growth focus is on North American markets such as the U.S. and Mexico. This follows a recent shift away from certain Latin American markets that offered higher growth, but also higher risk.
Turning to dividends, Scotiabank pays out a generous 6% yield, making it one of the best-paying options on the market.
Enbridge will supercharge your portfolio
Enbridge is an energy infrastructure behemoth. The company is best known for its pipeline segment, but Enbridge also boasts a natural gas utility and a growing renewable energy operation.
Collectively, those segments provide a reliable, growing, and increasingly defensive source of revenue. That revenue stream leaves room for growth while paying out a very handsome dividend.
As of the time of writing, Enbridge’s quarterly dividend works out to a tasty 5.8%. And like Fortis, Enbridge has an established cadence of providing annual bumps to that dividend that goes back three decades.
What’s your TFSA approach?
Building out a $21,000 TFSA can sound scary, but it doesn’t need to be. Starting small, investing often, and picking the right investments with reinvested dividends over time can lead to insane growth.
And while no stock is without risk, the trio of options mentioned above can provide growth and income-earning capabilities lasting decades.
In my opinion, one or all of the above should be core holdings in any well-diversified portfolio.
Buy them, hold them, and watch your TFSA grow.
