Now is as good a time as any to make a fresh contribution to your TFSA (Tax-Free Savings Account). The Canada Revenue Agency announced that the new contribution limit for 2025 was $7,000.
For Canadian investors, that is $7,000 that can be invested and earn income (capital gains, interest, and dividends) completely tax-free. When you don’t pay tax, you can save as much as 15–25% of your income.
If you are looking for some sure-shot stocks to hold in your TFSA, here are two stock ideas to buy with $7,000 right now.
Source: Getty Images
Constellation Software: A top TFSA stock for long-term compounding
Constellation Software (TSX:CSU) has been more volatile than usual this year. In the past month, its stock has fallen 9%. CSU dipped as low as $4,250 per share last week.
While that might seem like a steep price tag, many brokerages offer fractional trading today. Constellation’s high share price is because of its refusal to issue shares. It has had only 21.2 million shares for more than a decade.
That is a great hallmark of a thoughtful management team who have put smart compounding of shareholder value above everything else. Constellation’s strategy to consolidate specialized software companies around the world has created substantial shareholder value. Its stock is up 186% in the past five years and 700% in the past 10 years.
This TFSA stock is down on fears that growth might be slowing. Investors are concerned that AI-generated applications could compete with its niche software solutions. Constellation maintains that it too uses AI to improve and advance its solutions. If anyone can generate smart AI applications for its customers, it should be Constellation.
However, the stock is drawing down on the fear. In the past, any major decline in Constellation stock has been a great buying opportunity. If you can get Constellation stock in the $4200 range, it is a wonderful time to add this stock to your TFSA.
Descartes Systems: A tech stock with a great record of returns
Another software stock to add to your TFSA is Descartes Systems Group (TSX:DSG). Like Constellation, its stock has experienced a considerable decline in 2025. DSG is down 16.5% this year.
Nonetheless, it has been a great compounder of shareholder returns. Its stock is up 73% in the past five years and over 500% in the past 10 years.
Descartes provides crucial logistics and supply chain software solutions. It offers an essential transport network that enables freight to efficiently get from point A to point B.
The company has high recurring revenues and strong profit margins (+20%). The supply chain manager generates a lot of spare cash that it has been investing into clever acquisitions. Right now, it has $176 million of net cash in the bank ready to be deployed.
The U.S. tariff war is causing havoc on the global supply chain. Consequently, the market is concerned about Descartes’ growth in 2025. Yet, the pullback could be an excellent time to add the stock. Descartes is trading at the low-end of its five-year valuation range. For a long-term hold in a TFSA, Descartes could be a great buy today.
