The Tax-Free Savings Account (TFSA), launched in 2009, has become a big blessing for Canadians. The account was introduced to help and encourage Canadians to save more money. The Canadian government incentivized individuals by offering tax-free returns on the annual contribution limit. Each year, the Canada Revenue Agency (CRA) increases the contribution limit.
After the 2025 update, anyone who was eligible for a TFSA at the age of 18 since the account was introduced has a cumulative limit of $102,000.
You have far more liberty than using the TFSA as a mere savings account. You can enjoy the returns of any assets held in the account without incurring taxes, as long as you remain within the contribution limit. This means you can also use the account to hold assets like stocks.
Waste Connections
Waste Connections Inc. (TSX:WCN) is a bit of an odd choice if you’re thinking about investing in stocks that make financial sense, but it does make sense. Waste Connections is a $66.7 billion market-cap waste company. The company essentially provides traditional solid waste and recycling services across North America. The waste management firm has several landfills, recycling operations, and transfer stations. It serves residential, commercial, industrial, and energy end markets.
One man’s waste is another’s treasure, and that seems to be the case with WCN stock. The company has a massive addressable market, and it is the third-largest integrated provider of waste disposal services in the region. Over the years, its organic growth has accompanied several acquisitions that have made it a massive company.
With time, the need for waste disposal will only increase, so will the demand for its services. As of this writing, WCN stock trades for $258.50 per share.
Dollarama
Dollarama Inc. (TSX:DOL) is one of my favourite stocks to invest in, regardless of market conditions. Dollarama is a solid company with an excellent business model that helps it generate revenue growth no matter what is happening in the economy. It is a $48.7 billion market-cap company engaged in operating discount retail stores. The retailer has one of the largest chains of discount retail stores in the country, selling products at fixed and low prices.
When the economy isn’t easy on consumers, they look for ways to reduce costs. A discount store offering essentials at more affordable price points is the best place to go. This simple yet effective business model allows DOL stock to generate the kind of cash flows that can drive terrific value for shareholders in the long run.
As of this writing, Dollarama stock trades for $175.76 per share.
Foolish takeaway
When investing in stocks for your TFSA portfolio, it’s important to remember that selling a stock due to declining share prices after adding it to the account means reducing the contribution limit. This is why it’s better to use the contribution room to invest in assets you can buy and hold for the long run, without worrying about the short-term impact of market volatility.
To this end, Dollarama stock and Waste Connections stock can be excellent holdings to consider.
