The Canadian Stock I’d Buy Right Now for My Kids’ RESP

If you’re looking for cash to support your children and their educational future, this dividend stock could be a prime target.

Amy Legate-Wolfe

Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Before joining Motley Fool Canada, she wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote: “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published September 4, 2025 3:30 pm EDT

| More on: TRP

Key Points

TC Energy reported strong Q2 2025 results with $900 million net income and expects future EBITDA increases from new projects.
Despite high debt levels, TC Energy's $8.5 billion projects in service signal potential for improved cash flow and growth.
Offering a 4.77% dividend yield, TC Energy is a solid long-term investment option for children's education savings with excellent growth prospects.

Listen, I got two kids. They’re wild and they’re nuts, and they’re also absolutely brilliant and wonderful. Yet even though these two are still quite young, I’m already stressing out on how on earth I’m going to pay for whatever it is they become passionate about in their lives. Right now, that fluctuates between rocket scientist and the next KPop Demon Hunter. Not sure how to fund that one, if I’m honest.

Even so, my husband and I continue to put away the maximum amount we can each year towards each child’s Registered Education Savings Plan (RESP). Yet that’s only half the battle. The rest comes down to where on earth to invest? Today, one stock could be the best option on the TSX today.

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TRP

If there’s one thing that the world needs, it’s energy. Energy produces our food, powers our cars, supports just about everything. That’s what makes TC Energy (TSX:TRP) such a strong option for those wanting to invest in their child’s future.

First, let’s look at what’s been going on recently. This dividend stock reported a strong second quarter for 2025, with net income from continuing operations hitting $900 million. That’s up from $800 million over the last year. Meanwhile, comparable earnings before interest, taxes, depreciation and amortization (EBITDA) rose to $2.6 billion, up 12% from strong operational execution.

More to come

What’s more, the dividend stock has even more earnings power coming down the pipeline. The company successfully placed $8.5 billion in projects into service. Let’s say that again: $8.5 billion! They include the Southeast Gateway pipeline, which the company projects will increase EBITDA for 2025 to between $10.8 and $11 billion!

While the dividend stock continues to hold high debt levels at $59.5 billion and a debt-to-equity ratio (D/E) of 159%, it still has a lot to look forward to from all those investments. It looks like its negative free cash flow of $2 billion could easily be reversed with the new projects in service this year.

Looking ahead

Now remember, when thinking about an RESP, investors need to look beyond today. They need to think about value, opportunities, income, and long-term growth. Right now, this dividend stock offers all of that. The dividend sits at 4.8%, with a dividend of $3.40, coming out quarterly. Its ongoing East Lateral XPress project and multi-year growth plan are expansions with further cash-creating opportunities.

Then there’s value. The dividend stock is now near 52-week highs but still trades at a reasonable 17.5 times earnings. So with project execution underway, a stable dividend, strong value, and more growth in the future, now could certainly be the time to buy. In fact, $5,000 invested in this dividend stock would provide investors with $235 in annual dividend income. All that income can be invested further into your child’s future.

Bottom line

This dividend stock is a stellar opportunity for investors. It provides income, a solid growth path forward, and resilient project execution. New investors should consider the rewards from its project pipeline and financial management. As well, a long-term investment in this particular stock would certainly create returns in today’s North American energy market.

With growth already underway, dividends coming in, and a stable path forward, TC Energy looks like a prime option, especially for parents looking to build up an investment portfolio for their child’s future. No matter what that turns out to be.