The Tax-Free Savings Account (TFSA) is one of the most powerful tools available to Canadian investors. Unlike other registered accounts, all gains within a TFSA — whether from dividends, interest, or capital appreciation — are completely tax-free. That means you get to keep every dollar your investments earn, compounding your wealth even faster.
But investments aren’t created equal. To truly unlock the potential of your TFSA, you need growth-focused stocks with a track record of strong returns and a compelling long-term story. You can even set TFSA milestones to target financial freedom in retirement.
Before diving into the top picks, here’s a quick reminder of how compound interest works. Suppose you invest $1,000 and earn 10% annually. After one year, you have $1,100. If you reinvest that amount and continue earning 10%, you’ll have $1,210 in the second year, $1,331 in the third, and so on. Now, imagine this happening tax-free — year after year — inside your TFSA but at potentially higher returns.
So, what stocks could help accelerate that tax-free compounding? Here are three power picks built for long-term TFSA growth.
1. goeasy
goeasy (TSX:GSY) is Canada’s top non-prime lender, offering loans and lease-to-own services through brands like easyfinancial, easyhome, and LendCare. It fills a critical gap for consumers who can’t access traditional credit, making it a recession-resistant business.
Last quarter, goeasy delivered 11% revenue growth, reaching $418 million, and saw loan growth of 9% year over year. Its solid performance over time has translated into market-beating shareholder returns: in the past decade, goeasy stock delivered a total return of 31% per year, turning a $10,000 investment into more than $151,000.
With persistent profitability, goeasy remains a TFSA-worthy stock.
2. Constellation Software
Constellation Software (TSX:CSU) is a legendary Canadian tech company specializing in acquiring and scaling vertical market software (VMS) businesses. These firms provide mission-critical software to niche industries — creating highly sticky customer relationships and consistent cash flow.
Even after a recent 17% pullback, CSU stock has delivered phenomenal long-term results. Over the past 10 years, the stock has compounded at 23% annually, growing a $10,000 investment into roughly $81,500.
Its decentralized model, disciplined acquisition strategy, and culture of capital efficiency make Constellation one of the most reliable compounders on the TSX. Long-term TFSA investors should view dips as a buying opportunity.
3. Brookfield Corporation
Brookfield (TSX:BN) is a global investment firm in asset management, private equity, infrastructure, real estate, and renewable energy. It makes money not only through management fees but also through performance-based fees, particularly when it sells improved assets for a profit.
In the last decade, Brookfield stock delivered an impressive 17.5% annual return, turning $10,000 into more than $50,000. Its recent momentum is also strong — shares surged over 40% in the past 12 months, driven by a 21% jump in distributable earnings to US$5.3 billion.
With exposure to long-term global megatrends like artificial intelligence infrastructure and a history of value creation, Brookfield is an ideal TFSA candidate.
Investor takeaway
Generally speaking, in a TFSA, it’s not just about what you invest in — but how long you let those investments grow, tax-free.
On one hand, all three of these stocks have the potential to supercharge your TFSA through long-term, tax-free compounding. On the other hand, with markets near all-time highs, it may be wise to dollar-cost average into positions over time rather than investing a lump sum all at once.
