Falling Guaranteed Investment Certificate (GIC) rates are once again forcing Canadian pensioners to seek out alternatives to generate passive income inside their self-directed Tax-Free Savings Account (TFSA). One popular strategy involves owning top TSX dividend stocks with good track records and reliable distributions.
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Enbridge
Enbridge (TSX:ENB) just reported solid third-quarter (Q3) 2025 results and provided an important update on its capital program. The energy infrastructure giant added $3 billion to its development pipeline in the most recent quarter, boosting the secured capital projects program to $35 billion.
As the new assets are completed over the next five years, Enbridge expects the revenue and cash flow expansion to result in 5% annual distributable cash flow growth beyond 2026 through 2030. That should support ongoing dividend increases. Enbridge raised the dividend in each of the past 30 years.
The company has also been active on the acquisition front as it continues to diversify its asset base. Enbridge purchased three natural gas utilities in the United States in 2024. These assets complement the existing natural gas transmission infrastructure and position Enbridge to benefit from an expected surge in natural gas demand in the coming years as gas-fired power facilities are built to generate electricity.
Enbridge’s other purchases include an oil export terminal in Texas and America’s third-largest wind and solar developer. In addition, Enbridge is a partner on the Woodfibre liquified natural gas (LNG) export facility being built on the coast of British Columbia. These businesses all create opportunities for revenue expansion.
Enbridge’s share price is up considerably over the past two years, but investors can still get a 5.6% dividend yield from the stock.
Bank of Nova Scotia
Bank of Nova Scotia (TSX:BNS) is another stock that has been on a nice run, recently hitting a new all-time high. The bank is starting to see the benefits of a turnaround program that has focused on making the business more efficient while pivoting growth investments away from Latin America to the United States and Canada.
In the past two or three decades, Bank of Nova Scotia spent billions of dollars to buy assets in Latin America, hoping there would be strong growth opportunities as the middle class expanded. Political and economic volatility, however, has resulted in lower-than-anticipated returns for shareholders. Bank of Nova Scotia’s share price trailed the performance of its large Canadian peers, which focused more on the United States and Canada for growth.
As part of its transition, Bank of Nova Scotia sold its assets in Colombia, Costa Rica, and Panama earlier this year. In 2024, it also bought a 14.9% stake in KeyCorp, an American regional bank, to boost its U.S. presence.
Looking ahead, lower interest rates will ease pressure on borrowers who are carrying too much debt. This should lead to lower provisions for credit losses at the banks, as long as unemployment doesn’t surge. If the economy slides into a recession and job losses mount, Bank of Nova Scotia has a strong enough capital cushion to ride out the turbulence.
Investors who buy BNS stock at the current level can get a dividend yield of 4.7%.
The bottom line
Enbridge and Bank of Nova Scotia pay attractive dividends today with yields well above rates currently offered on GICs. If you have some cash to put to work in a portfolio focused on passive income, these stocks deserve to be on your radar.
