The Best $21,000 TFSA Approach for Canadian Investors

Canadian Investors have great options to consider for their TFSAs. Here’s a trio of options to buy now and hold for decades.

Key Points
  • For Canadians with about $21,000 to invest in a TFSA, three high-quality dividend stocks across telecom, banking, and utilities stand out.
  • Telus: defensive, subscription-based revenue, 8.21% yield, heavy capex (including AI data centers) through 2029, and two decades of annual dividend hikes.
  • TD (3.68% yield, 160-year dividend payer with a growing U.S. footprint) and Canadian Utilities (4.32% yield, 53 straight raises, a Dividend King) add stability and diversification—plus TFSA gains are tax-free.

TFSA accounts represent one of, if not the single best option for Canadian investors to stash away contributions and let them grow.

And for those Canadian investors who have a $21,000 cushion to invest in their TFSA, there are plenty of great options to consider.

Here’s a trio of top picks with tasty yields from different segments of the market that you will regret not investing in.

Blocks conceptualizing Canada's Tax Free Savings Account

Source: Getty Images

Pick 1: The telecom

Canada’s big telecom stocks represent an excellent long-term investment option for those seeking long-term growth and juicy dividends. And the telecom for investors to consider right now is Telus (TSX: T)

Telus offers the usual complement of subscriber-based services to customers across Canada. That includes wireline, wireless, TV and internet services.

Those segments are incredibly defensive, which translates into a major advantage for prospective Canadian investors.

That’s not all. Thanks to the sheer necessity they provide, those services also generate a stable and recurring revenue stream that allows Telus to invest in growth and pay out a handsome dividend.

In terms of growth, that includes investing in upgrading infrastructure and expanding its coverage. The company is also investing in AI data centre investments. In fact, Telus has earmarked over $50 billion through 2029 on those projects.

Turning to dividends, Telus really impresses Canadian investors. The company offers a tasty quarterly dividend carrying a yield of 8.2% making it a top-paying option.

Telus has also provided investors with annual or better upticks to that dividend for two decades without fail.

Pick 2: The big bank

It would be nearly impossible to compile a list of great stocks for Canadian investors to pad their TFSAs without mentioning a big bank stock.

And that big bank stock to consider right now is Toronto-Dominion Bank (TSX: TD).

TD is the second-largest of the big banks with a massive presence on both sides of the border. In Canada, TD’s stable branch network provides a source of revenue that allows it to invest in growth and pay out a tasty quarterly dividend.

The U.S. is TD’s primary growth market. In the years following the Great Recession, TD stitched together an impressive network on the East Coast. Today, that branch network stretches from Maine to Florida and provides a growing source of revenue for the bank.

Turning to dividends, TD has paid out dividends for over 160 years without fail. That’s an incredible amount of time and speaks to the bank’s stability for Canadian investors.

As of the time of writing, TD offers a respectable 3.7% yield, making it a solid option for any portfolio.

Pick 3: The utility

One final pick for Canadian investors looking to invest in their TFSA is Canadian Utilities (TSX: CU). Canadian Utilities is one of the best-known utility stocks with a growing portfolio of operations domestically and internationally.

Outside of Canada, Canadian Utilities has operations in Mexico, Australia, Chile, and Puerto Rico. Like its domestic operations, those facilities provide a recurring, regulated and stable source of revenue for the company.

That stable revenue stream allows Canadian Utilities to invest in growth and continue to pay out its generous quarterly dividend. As of the time of writing, that dividend carries a 4.3% yield.

More importantly, Canadian Utilities has provided investors with tasty upticks to that dividend for an incredible 53 consecutive years without fail.

That makes Canadian Utilities one of just two Dividend Kings in Canada, and the longest streak of any company.

Final thoughts for Canadian investors

No stock is without risk. That’s why a well-diversified portfolio is a must for Canadian investors. That’s also why this trio of stocks is so appealing.

Telus provides the stability, TD provides the financial strength, and Canadian Utilities is on defence. It’s the perfect mix of investments that can power your portfolio to long-term greatness.

Buy them, hold them, and watch your portfolio (and future income) grow. And keep in mind that if those investments are in a TFSA, that growth comes tax-free.

Fool contributor Demetris Afxentiou has positions in Toronto-Dominion Bank. The Motley Fool recommends TELUS. The Motley Fool has a disclosure policy.

More on Stocks for Beginners

Train cars pass over trestle bridge in the mountains
Stocks for Beginners

This Canadian Stock Is Down 9%: I’d Buy it for Life

CN is below its yearly high while grain shipments set a record, giving long-term investors a concrete reason to examine…

Read more »

trading chart of brent crude oil prices
Energy Stocks

Oil Hit a Two-Week High: This Canadian Producer Turns it Into Dividends

CNQ's recent cash-funded dividends, buybacks, and debt reduction are allowing shareholders to capture the windfall from the oil rally.

Read more »

running robot changes direction
Energy Stocks

Down 15%: Is TC Energy a Rebound Buy for Retirement Income?

A dollar-cost averaging strategy to buy on dips may be a lower-risk way to build long-term income versus a lumpsum…

Read more »

man in bowtie poses with abacus
Stocks for Beginners

Can You Really Build Wealth From a Small Start? Here’s What the Math Says

Discover how investing just $500 a month in XEQT could build meaningful wealth over time through diversification, reinvested dividends, and…

Read more »

Paper Canadian currency of various denominations
Stocks for Beginners

Your Broker Withholds 15% on U.S. Dividends: Here’s The Tax Credit That Gets It Back

U.S. dividend withholding depends on your account, while BMO shows how a Canadian stock can offer U.S. exposure.

Read more »

Hand Protecting Senior Couple
Stocks for Beginners

How Much Do You Actually Need to Retire in Canada?

The same retirement lifestyle can require very different savings balances once pensions and withdrawal taxes enter the calculation.

Read more »

Real estate investment concept with person pointing on growth graph and coin stacking to get profit from property
Dividend Stocks

Mortgage Rates Are Rising: The Bank of Canada Hasn’t Moved

Fixed mortgage rates can rise without a central-bank move, adding real monthly costs while also testing lenders' funding and credit…

Read more »

Piggy bank and Canadian coins
Stocks for Beginners

Where Should Canadians Keep Emergency Cash? (It’s Not Where You Think)

Prioritize safety and access for your emergency cash — the simplest way is to use a competitive high‑interest savings account.

Read more »