Canadian pensioners are searching for ways to get better returns on cash held inside their self-directed Tax-Free Savings Account (TFSA) portfolios. One popular strategy involves owning high-yield TSX dividend stocks.
Enbridge
Enbridge (TSX:ENB) trades near $68 per share at the time of writing. That’s up from $46 two years ago, when the stock started to rally again after an extended pullback.
The rebound began about the time the Bank of Canada and the U.S. Federal Reserve signalled they were done raising interest rates to fight inflation. High borrowing costs tend to be negative for pipeline and utility companies that use debt to fund large capital projects. The subsequent cuts to interest rates helped extend the rally in Enbridge’s share price this year. Additional rate cuts are widely expected in 2026 as the central banks shift their focus to providing support for the economy.
Enbridge recently updated its capital program. The company now has $35 billion in secured growth projects in the development backlog. As the new assets go into service, the revenue boost will combine with contributions from acquisitions to drive cash flow growth in the range of 5% beyond 2026 through at least 2030. This should enable Enbridge to maintain annual dividend increases. The board raised the dividend in each of the past 30 years.
Investors who buy ENB stock at the current level can get a dividend yield of 5.5%.
BCE
BCE (TSX:BCE) is a contrarian pick today. The stock trades around $32 per share. It was as high as $74 in 2022, but went into a steady decline as rising debt expenses and price wars on mobile and internet plans put pressure on the balance sheet. This ultimately forced BCE to cut its generous dividend.
Headwinds remain for the Canadian telecom sector amid lower immigration, particularly the steep cuts to international students, who were a good source of new phone sales and data subscription sales. That being said, lower interest rates and rising prices for mobile and internet plans should provide some stability heading into next year.
BCE is betting on growth in the United States after its acquisition of Ziply. The company is also investing in AI infrastructure and services to provide Canadian clients with an option to ensure all of their data remains inside the country.
BCE reported steady third-quarter (Q3) 2025 results compared to last year. Operating revenue rose 1.3% and free cash flow jumped 20%.
At this point, most of the damage to the stock should be in the rearview mirror, but investors hoping for a rebound in the share price will have to be patient as it will take time for the strategy shifts and new investments to deliver growth. The current dividend payment, however, should be safe and now provides a solid 5.4% yield for those seeking passive income.
The bottom line
Enbridge and BCE are leaders in their respective industries and pay attractive dividends. If you have some cash to put to work in a self-directed TFSA focused on passive income, these stocks deserve to be on your radar.
