The start of the year is the perfect time to plan out how you want to use your excess TFSA (Tax-Free Savings Account) contribution space. The new year offers a clean slate and new possibilities. If I had $20,000 to invest, here are three Canadian stocks I’d diversify my TFSA capital across.
A defensive utility-like business to hold in a TFSA
The first stock I would consider adding to my TFSA right now is Waste Connection (TSX:WCN). With a market cap of $60 billion, Waste Connections is the third largest waste infrastructure company in North America.
It takes a unique approach because it tends to focus on smaller, niche markets where it can be the dominant waste provider. This helps it avoid competition and ensure long-term pricing power.
Year-to-date, revenues are up 6.5% to $7.1 billion and adjusted earnings per share are up by a similar rate. Waste Connection may not be the fastest growing business, but it does have a long record of compounding shareholder value.
Waste Connections stock is down 9% in the past year. Its valuation is trading near its 10-year average. It’s not a bad time to add this stock for a steady, utility-like position in your TFSA.
A real estate stock that pays cash monthly
If you are looking for income, real estate is an attractive place to look right now. Given how unstable the world seems, hard assets (like quality real estate) should gain attraction to investment managers. That is why Granite Real Estate Investment Trust (TSX:GRT.UN) offers a nice mix of defence, growth, and income.
With a market cap of $5.4 billion, it has institutional quality logistics, manufacturing, and warehousing assets in Canada, Europe, and America. The REIT has enjoyed strong leasing momentum over 2025. Occupancy sits at 98% today. Funds from operation per unit are up 8.8% for the first nine months of 2025. It is projecting mid-to-high single digit growth in 2026.
The REIT has a fortress balance sheet and a sector leading management team. GRT.UN yields 4% right now. It has a 15-year history of annually raising its distribution. Granite is another low volatility stock worth holding as ballast for your TFSA portfolio.
A TFSA tech stock that is more than just software
Descartes Systems Group (TSX:DSG) is a stock to add for your TFSA if you want a little more growth longer term. This stock has recently taken a real hit. It is down 7% in 2026 and 35% over the past year.
Descartes is getting grouped in with the software sector as a potential victim of the AI revolution. Yet, many investors don’t recognize that Descartes actually operates a crucial global logistics network. Certainly, it compliments this with software solutions. However, AI is not something that can easily disrupt the network.
Descartes is actually using AI to accelerate the development of complimentary software for its customers. Likewise, many software company valuations have rapidly declined. As a result, it can be opportunistic to add some of these businesses to its platform at attractive prices.
With world trade increasingly being disrupted by geopolitics, vendors need Descartes’ solutions to make better real-time decisions. Consequently, Descartes has been gaining market share in recent quarters.
This stock has a lot to like: high margins, recurring revenues, strong cash generation, a cash-rich balance sheet, and a smart management team. It is not a cheap stock. However, it has declined to its lowest valuation in more than five years. If you don’t mind being a bit contrarian, this is an attractive opportunity to add Descartes to your TFSA for a long-term buy-and-hold position.
