If I could only own one stock inside my Tax-Free Savings Account (TFSA) for the rest of my life, it would be Brookfield Infrastructure Partners (TSX: BIP.UN) because it combines three of the most powerful wealth-building traits: reliable income, long-term growth, and durable competitive advantages.
Source: Getty Images
Reliable income that compounds tax-free
At its core, Brookfield Infrastructure owns essential assets, such as utilities, pipelines, rail networks, and data infrastructure, which economies simply cannot function without. Whether it’s moving energy, powering cities, or enabling data flow, demand for infrastructure tends to persist regardless of economic cycles. That stability is exactly what TFSA investors should prioritize.
One of the biggest reasons to hold BIP.UN forever is its income profile. The partnership currently offers a dividend yield of roughly 5.1%, paid quarterly, making it a great idea for investors who seek passive income.
Importantly, Brookfield has a long history of increasing distributions, with management targeting to grow its cash distribution by 5–9% annually going forward, supported by rising cash flows and disciplined capital allocation.
Inside a TFSA, that combination is incredibly powerful. You’re not just collecting income — you’re compounding it tax-free, year after year.
Growth driven by strategic investments
Income alone isn’t enough. What makes Brookfield Infrastructure truly special is its growth engine. The company consistently expands through a mix of organic growth and strategic acquisitions. It invests in sectors benefiting from long-term tailwinds, including digital infrastructure, energy transition, and global transportation networks. In fact, its data infrastructure segment has seen explosive growth tied to artificial intelligence (AI) and connectivity demand, while acquisitions would add scale. For example, in 2025, the company commissioned over US$1.5 billion of new capital projects from its backlog, while it completed over US$1.1 billion of new acquisitions.
Brookfield employs a highly effective capital recycling strategy — selling mature assets at attractive valuations and reinvesting proceeds into higher-growth opportunities. This approach allows it to fund expansion without constantly issuing new equity, helping drive steady increases in funds from operations (FFO), the key metric behind its cash distribution growth.
Durable competitive advantages and inflation protection
Equally important is its competitive moat. Infrastructure is one of the hardest industries to disrupt. Brookfield benefits from high barriers to entry, long-term contracts and regulated assets. Its scale and global reach give it pricing power and operational efficiency that smaller competitors cannot match.
Another underappreciated strength is inflation protection. About 85% of Brookfield Infrastructure’s cash flows are either directly indexed to inflation or protected through contractual escalators. That means as costs rise across the economy, its revenues often rise too — helping preserve real purchasing power for investors.
Of course, no investment is perfect. Brookfield uses leverage, and its payout ratios can appear high depending on the metric used. But focusing on cash flow rather than accounting earnings paints a more accurate picture of sustainability — and historically, the company has managed these risks well.
Investor takeaway
BIP.UN represents something rare: a business designed to endure. It owns critical infrastructure, generates resilient cash flows, grows through disciplined reinvestment, and rewards investors with rising income.
For a TFSA investor thinking in decades — not months — that’s exactly the kind of stock you hold forever.
