How I’d Create $117 in Monthly Income With a $20,000 TFSA Investment

If you’re looking to turn your Tax-Free Savings Account (TFSA) into a steady source of monthly income, dividend-paying stocks can be a reliable way to do it, especially those that offer regular monthly payouts. The key is to invest in companies with strong financials, a consistent track record of distributing dividends, and offering high and sustainable yields.

By choosing such stocks, TFSA investors can create a steady stream of cash flow that aligns with their budgeting goals. The dividend income can be reinvested to boost returns and build wealth, or it can be used to help cover regular living expenses without depleting the original investment capital.

Another crucial part of this strategy is diversification. Spreading your TFSA investment across different sectors helps reduce exposure to market volatility and lowers the risk of relying too heavily on a single stock or industry. A well-diversified portfolio ensures that your income stream remains stable even when certain sectors face headwinds.

Against this backdrop, here are two dividend-paying stocks that can turn a $20,000 TFSA investment into a consistent passive income of over $117 per month.

SmartCentres REIT

SmartCentres REIT (TSX:SRU.UN) is a reliable stock to generate steady monthly income in a TFSA. Known for its consistent payouts and high yield, the REIT’s well-diversified portfolio generates steady net operating income (NOI), supporting its payouts.

The REIT owns 197 mixed-use properties across Canada, strategically located at key sites. Thus, its properties witness solid leasing demand and high occupancy rates, translating into dependable rental income. For instance, SmartCentres reported a high occupancy rate of 98.6% in the second quarter of 2025. Thanks to its high-quality tenant base, including large retailers, the cash collection rate was above 99%. Notably, strong lease renewals at higher rates in Q2 further signal robust demand for its properties.

SmartCentres REIT currently pays a $0.154 dividend per share, reflecting a yield of about 7%. Looking ahead, the strength of its core retail properties, high occupancy, and mixed-use development projects bodes well for growth and is likely to drive its NOI and future distributions. Also, its substantial land holdings and a strong balance sheet position the REIT to benefit from urbanization and evolving consumer trends.

Whitecap Resources

Whitecap Resources (TSX:WCP) is another dependable income stock to add to your TFSA portfolio. The company is known for rewarding shareholders through consistent dividend payments. The oil and gas producer pays a monthly dividend of $0.061 per share, reflecting a high yield of about 7.1%. Notably, from January 2013 to September 2025, WCP has returned approximately $2.7 billion to shareholders in the form of dividends.

Whitecap is focused on sustaining its payouts over the long term. The company’s emphasis on operational efficiency and careful selection of projects that deliver strong returns augur well for future growth. Moreover, by optimizing its drilling programs and focusing on high-quality assets, Whitecap has positioned itself to maintain steady earnings, supporting its payouts.

Further, Whitecap’s recent acquisition of Veren significantly enhances its scale and operational strength. The addition of Veren’s high-quality assets deepens Whitecap’s production capabilities and complements its existing portfolio of premium projects. Overall, Whitecap is well-positioned to maintain its payouts in the coming years.

Earn over $117 per month in tax-free income

SmartCentres REIT and Whitecap Resources are attractive TSX stocks to start a monthly passive-income stream. By investing $20,000 and dividing it equally between the two, you could generate around $117.25 per month in passive income.