I’d Put All My $7,000 TFSA Contribution Into This Dividend Stock Right Now

If I’m looking to make some extra cash, then this dividend stock is my first stop.

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Job-hopping isn’t just a Gen Z stereotype anymore. According to a new CVwizard study, a staggering 66% of Gen Z and 65% of Millennials are planning to change jobs in 2025. It’s not just about the money, though 35% said salary is their top motivator. Job security is just as important, with 20% citing it as their key reason for leaving. That’s a big signal that today’s young professionals aren’t looking for get-rich-quick opportunities. They’re looking for stable, long-term growth. Which is exactly why I’d invest my entire $7,000 Tax-Free Savings Account (TFSA) contribution into Canadian Imperial Bank of Commerce (TSX:CM) right now.

Why CIBC works

The idea might sound boring. A bank? In the middle of economic uncertainty? But that’s exactly the point. When investors are worried about shaky markets, rising interest rates, or trade tensions, a big bank like CIBC starts looking more like a fortress than a financial stock. CIBC has a long history of weathering economic ups and downs. It isn’t just holding on, it’s adapting, modernizing, and paying shareholders well to stick around while it does.

CIBC’s second-quarter earnings give a pretty good snapshot of why this dividend stock is worth consideration. Revenue hit $7 billion, up 14% year over year. Adjusted net income came in at $2 billion, also up 17%. Diluted earnings per share (EPS) were $2.05, and while that’s down slightly from last quarter, it’s still a solid showing. The bank’s Common Equity Tier 1 ratio sat at 13.4%, showing strong capital backing. And despite some bumps from higher credit loss provisions, the underlying business remains robust across personal banking, commercial lending, and wealth management.

If you’re looking at dividends, CIBC is one of the most reliable payers in the country. At today’s share price, the stock yields over 4%, offering a much-needed boost to any passive income strategy. And that dividend has been paid, maintained, and raised across decades of volatility. It’s the kind of stability that should catch your eye, especially if your TFSA is intended to grow steadily over the long haul.

Considerations

The bank is also entering a leadership transition, with Victor Dodig set to retire this fall and Harry Culham stepping in. Culham is no stranger to the business, and that kind of internal succession tends to bode well for continuity. With strong earnings momentum, CIBC is well-positioned to keep delivering through the hand-off. Unlike some competitors, it’s not overly exposed to risky sectors, and it has made strategic investments in digital banking and artificial intelligence (AI) integration that could drive long-term efficiencies.

Of course, there are risks. Loan defaults could rise if the economy worsens, and tighter lending regulations or geopolitical shocks could weigh on earnings. But these risks aren’t unique to CIBC. And compared to the payout and the upside, they look manageable. Especially if you’re not looking to flip your investment in a year or two.

What makes CIBC stand out even more is how it fits into today’s shifting job market narrative. Young workers aren’t only switching jobs for excitement; they’re doing it because they want stability, control, and peace of mind. In a way, investing in CIBC aligns with those same goals. You’re putting your money somewhere it can work quietly in the background, steadily growing and paying you back. In fact, that $7,000 would bring in an annual income of $271 right away!

COMPANYRECENT PRICENUMBER OF SHARESDIVIDENDTOTAL PAYOUTFREQUENCYTOTAL INVESTMENT
CM$99.0070$3.88$271.60Quarterly$6,930.00

Bottom line

For younger investors anxious about the stock market or overwhelmed by choices, going with a bank stock like CIBC is a way to keep things simple. You don’t need to track 50 holdings or understand the nuances of a growth fund. You just need to believe that Canadian banking isn’t going anywhere, and that long-term earnings and dividend payouts are likely to keep flowing.

So while others chase the next hot stock, I’d rather focus on something built to last. If I were putting my $7,000 TFSA to work today, CIBC would be my top pick. It pays me to wait, supports long-term goals, and reflects the kind of steady, values-driven growth that younger investors are finally starting to demand.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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