The $25,000 Approach to Building Lasting Wealth

Making the most of your investment requires making smart decisions. These two TSX stocks are excellent examples of stocks that can earn you income over the long term.

Adam Othman

Adam is a value investor who is always on the hunt for fantastic undervalued companies that he can share with Motley Fool readers. He follows Warren Buffett and Charlie Munger's investment advice and has completed the Canadian Securities Course. When he's not investing, Adam can usually be found traveling or skiing.

Published June 18, 2025 9:15 pm EDT

| More on: CNQENB

Being a stock market investor in Canada can be a blessing due to the introduction of the Tax-Free Savings Account (TFSA). The Canadian government introduced it in 2009 to encourage Canadians to save more money. The incentive through the TFSA? Any earnings made from assets held in the “savings” account will be tax-free.

You can use the account to hold cash and generate interest income without incurring taxes on it. However, there’s a lot more that you can do with the contribution room you get in the account. You can even allocate some of the contribution room to buy and hold stocks to generate tax-free wealth growth through capital gains and dividends.

Canadian Natural Resources

The Canadian energy sector has long been an attractive space for Canadian investors seeking long-term dividend income. Canadian Natural Resources Ltd. (TSX:CNQ), perhaps one of the most reliable energy producers in the country, may be ideal for this purpose. Canadian Natural Resources is a $94.7 billion market-cap Calgary-based energy producer. It is a top dividend stock that might offer some upside potential to investors.

CNQ produces oil and gas, boasting vast natural gas resources in Western Canada and significant operations off the coast in Africa and the North Sea. The business is well-capitalized, and has a track record of making good acquisitions at opportune times and an impeccable reputation for paying investors their dividends. It has increased payouts for the last 25 years without fail.

As of this writing, it trades for $45.24 per share and boasts a 5.2% annualized dividend yield that you can lock into your portfolio.

Enbridge

Enbridge Inc. (TSX:ENB) is another top Canadian energy stock. Boasting a $136.05 billion market capitalization, the Calgary-based company is an energy infrastructure company. It has an extensive pipeline network responsible for transporting a lot of the hydrocarbons produced and consumed in North America. The company also boasts one of the largest regulated natural gas utility businesses under its belt, alongside a growing portfolio of renewable energy assets.

Enbridge charges other energy producers for using its network, marginally shielding the company from the effects of volatile commodity prices. Its utility segment provides stable and predictable cash flows. The growing renewable energy arm will future-proof the company in a greener energy industry.

As of this writing, ENB stock trades for $62.41 per share, with a 6% annualized dividend yield, and it boasts an over three-decade dividend-growth streak.

Foolish takeaway

The TFSA can be an ideal investment vehicle for anyone with a sound long-term strategy. When using it to invest in dividend stocks, you can use the quarterly or monthly distributions to line your account balance with extra cash. If you choose to reinvest the dividends using a Dividend Reinvestment Plan (DRIP), you can unlock the power of compounding and accelerate your wealth growth.

To this end, high-quality dividend stocks that keep increasing payouts like ENB stock and CNQ stock can be worthwhile investments to consider.