I’d Put My Entire TFSA Into This 4.7% Dividend Giant

A single high-yield TFSA holding could turn global infrastructure cash flow into tax-free income that grows with AI-era demand.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published July 24, 10:00 am EDT

| More on: BIP.UN

Key Points

Brookfield Infrastructure pays about a 4.7% yield from essential assets like utilities, transport, and data networks worldwide.
Its cash flow is steadier because much revenue comes from regulated rates and long-term contracts.
AI growth needs power and data centres, and Brookfield is investing there while still raising distributions annually.

Picture one Tax-Free Savings Account (TFSA) helping cover an entire year of utility bills — all while the investment underneath it keeps owning power networks, toll roads, pipelines, railcars, and data centres around the world. Pretty amazing, right? For a Canadian who has accumulated the full $109,000 of TFSA room since 2009, a 4.7% yield could generate roughly $5,100 in annual tax-free income.

Of course, that account wouldn’t need to remain frozen in place, either. Reinvesting the distributions could purchase more units every quarter, while future increases could gradually turn today’s income into a much larger retirement paycheque. So, what’s this magical stock that could get you there?

chart reflected in eyeglass lenses — Source: Getty Images

One stock; many businesses

Placing an entire account into one investment usually creates unnecessary risk. A dividend cut, management mistake, or industry downturn could damage both the income and the account balance at once.

If I had to choose one holding, though, I’d want it to behave more like a portfolio than a single company. That means several industries, multiple countries, contracted revenue, and a long record of raising distributions.

Those requirements lead to Brookfield Infrastructure Partners (TSX:BIP.UN). The infrastructure giant owns utilities, transportation networks, midstream assets, data centres, fibre networks, and other essential systems across the Americas, Europe, and Asia Pacific.

Cash flow built to last

Much of BIP stock’S revenue comes from regulated rates or long-term contracts. Customers continue using electricity networks, ports, pipelines, and communications infrastructure through strong economies and weak ones, giving the business more stability than a typical cyclical stock.

That stability showed during the first quarter, when funds from operations (FFO) per unit rose 10% to US$0.90. BIP stock commissioned more than US$1.7 billion of projects from its backlog over the previous year, helping existing operations produce growth before acquisitions entered the picture.

The company then turns mature assets into fresh investment capital. BIP stock secured nearly US$1 billion from asset sales and partnerships early in 2026, allowing it to fund new projects without depending entirely on debt or issuing more units.

AI needs infrastructure

That recycled capital can now chase one of the largest infrastructure opportunities in decades. Artificial intelligence (AI) requires data centres, fibre networks, reliable electricity, cooling systems, and backup generation long before anyone asks a chatbot to write another questionable wedding speech.

BIP stock’s data-segment FFO jumped 46% during the first quarter as new fibre and data centre investments contributed. Its US$5 billion partnership with Bloom Energy also aims to install up to one gigawatt of behind-the-meter generation, helping data centre customers secure power without waiting years for grid connections.

That growth supports an income record investors can already see. BIP stock raised its quarterly distribution 6% for 2026, marking its 17th consecutive annual increase, and management continues targeting 5% to 9% yearly growth.

Considerations

Investment income and withdrawals generally remain free from Canadian tax inside a TFSA. That shelter allows every distribution to remain available for spending or reinvestment instead of losing part of the payment at tax time.

BIP stock recently traded near $54.65, placing its yield around 4.7%. The payout gets declared in U.S. dollars, so Canadian payments can fluctuate with exchange rates, yet that currency exposure also adds another layer of diversification.

That said, BIP stock uses substantial debt across its infrastructure portfolio, leaving results sensitive to refinancing costs and interest rates. Acquisitions, construction delays, currency movements, and weaker economic activity could also pressure cash flow.

Those risks mean I’d still prefer BIP stock as the largest part of a diversified collection of Canadian dividend stocks, not literally every dollar for every investor. Yet its global reach makes the concentration far less extreme than owning one bank, retailer, or energy producer.

Bottom line

Brookfield Infrastructure combines a 4.7% yield with essential assets, growing digital exposure, and 17 consecutive annual distribution increases. Investors who keep reinvesting could let today’s infrastructure income compound alongside the power and data demand shaping the decades ahead.