2.7% Monthly Income: Today’s Perfect TFSA Stock

Chartwell Retirement Residences pays a 2.7% monthly distribution and just posted record growth. Here is why it fits a TFSA today.

Key Points
  • Chartwell's 2025 results were the strongest in company history, with same-property net operating income up 18.4% and funds from operations per unit up 25%.
  • Growth continued to accelerate into 2026, with first-quarter funds from operations per unit rising 35% year over year.
  • Rising demand from Canada's aging population, combined with limited new senior housing supply for at least three years, gives Chartwell a multi-year runway to keep growing its monthly payout.

If you want your Tax-Free Savings Account (TFSA) to generate cash every single month, you can invest in quality dividend stocks such as Chartwell Retirement Residences (TSX: CSH.UN). In addition to a steady stream of monthly dividends, the Canadian stock also helps shareholders build wealth via long-term capital gains.

Over the last five years, Chartwell Retirement Residences has returned close to 120% in dividend-adjusted gains to shareholders. Despite these outsized gains, the Canadian dividend stock offers a 2.7% yield and a monthly payout.

The business just delivered its best year on record, and the momentum has carried into 2026.

senior man and woman stretch their legs on yoga mats outside

Source: Getty Images

Is this Canadian dividend stock a good buy?

Canada has a sizeable aging population, and demand for senior housing is expected to climb around 5% each year in the next decade. At the same time, new construction of senior residences has slowed, and the trend is expected to continue for at least three more years, according to comments made by Chartwell CEO Vlad Volodarski at the company’s June 19 annual meeting.

This combination gives operators like Chartwell pricing power and room to fill more suites without a wave of new competitors showing up next door.

Chartwell has been using that window to reposition its portfolio toward newer buildings in stronger markets, while tightening the efficiency of its existing residences.

In 2025, same-property occupancy rose 480 basis points, and same-property net operating income grew 18.4%.

Funds from operations (FFO) per unit, a key measure of cash generated by real estate trusts, jumped 25% year over year.

In the first quarter of 2026, occupancy improved another 400 basis points compared to the same period a year earlier. Moreover, same-property net operating income increased 15.6%, and funds from operations per unit grew 35%.

Chartwell reported that 82% of residents said they were satisfied living in its communities, and 85% of employees said they felt engaged at work. Happy residents stay longer and refer family and friends, while engaged staff keep turnover low, which protects margins.

Management pointed to ongoing reinvestment in its properties as proof it is playing the long game rather than squeezing short-term profits.

At the company’s Grenadier residence in Toronto, for example, Chartwell is undertaking a multi-year $1 million renovation to modernize the building while maintaining full occupancy.

Should you add Chartwell to your TFSA?

Chartwell checks the boxes income investors care about. It pays a monthly dividend and operates in a sector with rising demand and limited new supply, and its most recent results show growth is accelerating.

I think Chartwell deserves serious consideration for a TFSA built around steady income. The monthly payout and capital gains, when generated in the TFSA, are tax-free for life.

Chartwell should be one piece of a diversified portfolio, and not your only TFSA holding. Notably, real estate trusts can be sensitive to interest rates, and renovation projects like the one underway at Grenadier carry execution risk.

Still, for investors looking for a quality stock with a consistent payout. Chartwell stock is worth a close look right now.

Fool contributor Aditya Raghunath has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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