The TFSA (Tax-Free Savings Account) is the ideal place for holding long-term investments. The TFSA protects you from paying any tax on the income (capital gains, dividends, or interest) that you earn inside the account. All your base capital and earnings stay with you.
The TFSA allows the laws of compounding to work unabated. That is why it is perfect for stocks that you intend to buy and hold for years and even decades. A major part of that compounding is picking great quality stocks that are worth holding for those extended periods of time.
Here are three top dividend stocks that should provide a nice mix of total returns (dividends and capital gains) for the years ahead.
A diversified stock for monthly TFSA income
Exchange Income Corp. (TSX:EIF) has delivered solid returns for patient shareholders. Its stock is up 118% in the past five years and 342% in the past 15 years. However, if you add in dividends reinvested, total returns increase respectively to 184% and 1,088%!
Over time, Exchange has built an aviation empire that caters to hard-to-reach places in Canada’s north. It has expertise in freight, passenger, medivac, firefighting, and surveillance/defence. It also has an air lease and finance business, as well as various industrial businesses focused on access solutions, manufacturing, and glass pane/window installation.
The company has been firing on all cylinders in 2025. Throughout the year, it has been delivering record revenues, earnings, and free cash flow. It just raised its annual guidance.
Exchange pays a monthly $0.22 per share dividend that equates to a 3.6% yield. It has raised its dividend 17 times over 20 years. It’s likely to raise its dividend again given the great results. For a nice conglomerate of essential companies, this is an attractive long-term TFSA stock.
A transport stock with an excellent record of returns
TFI International (TSX:TFII) is a perfect dividend stock to hold for years in a TFSA. Certainly, it hit a bit of a road bump in 2025, but it has been a great long-term performer.
Even after its 36% drawdown this year, this stock has delivered total returns of 106% in the past five years and 1,603% in the past 15 years. TFI is facing a tough freight environment. However, things could start to improve in 2026 and beyond.
TFI is working hard to improve its U.S. operations and right-size its cost base. The company is buying back stock and holding cash for its next big acquisition. This stock is down for now, but it won’t be forever.
It pays a 2.2% dividend yield. TFI has raised that dividend, which has risen by a 10% compounded annual growth rate over the past 15 years.
A top Canadian bank for compounding TFSA returns
Most Canadians wouldn’t know it, but the best-performing bank stock in Canada is National Bank of Canada (TSX:NA). It has delivered a 185% total return over the past five years and an 800% total return over the past 15 years.
While it is the smallest of the Big Six Banks, it used its specialty focus on Quebec and niche services to dominate. By doing this, it has avoided competition with its larger peers. Its recent merger into the Alberta market (through Canadian Western Bank) opens a whole new avenue of growth.
National Bank stock yields 2.9% today. Its dividend has risen by an 8% CAGR for 20 years. This is a solid business to hold in your TFSA to collect a growing stream of income for years ahead.
