An extra $800 per month is something we all could use. That cash could cover groceries, utilities, or one surprisingly ordinary trip to Costco. Inside a Tax-Free Savings Account (TFSA), it could also arrive without creating a tax bill. The uncomfortable part is the price tag. Depending on the yield, that paycheque may require anywhere from roughly $82,500 to $320,000.
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Do the math
The calculation begins with $9,600 in annual income. Divide that amount by the portfolio’s yield and the required TFSA balance appears. At a cautious 4% yield, investors need $240,000. Chasing an 11.6% yield drops the requirement dramatically, although risk doesn’t disappear simply because the calculator looks happier.
| PORTFOLIO YIELD | TFSA BALANCE NEEDED | ANNUAL INCOME | MONTHLY AVERAGE |
|---|---|---|---|
| 3% | $320,000 | $9,600 | $800 |
| 4% | $240,000 | $9,600 | $800 |
| 5% | $192,000 | $9,600 | $800 |
| 6% | $160,000 | $9,600 | $800 |
| 8% | $120,000 | $9,600 | $800 |
| 11.6% | Approximately $82,500 | $9,600 | $800 |
The sensible answer is therefore usually between $160,000 and $240,000, supported by a diversified portfolio yielding 4% to 6%. A smaller balance can produce the same income, but only by accepting greater dividend, distribution, and share-price risk.
The 2026 TFSA contribution limit is $7,000, so investors can’t simply deposit the entire amount unless they have sufficient unused room. Unused room carries forward, while withdrawals generally return as room the following calendar year. Growth inside a Tax-Free Savings Account (TFSA) doesn’t consume room, allowing the balance to eventually grow far beyond the amount contributed.
The Canada Revenue Agency (CRA) also confirms that TFSA income and withdrawals generally won’t affect federal income-tested benefits such as Old Age Security (OAS) or the Guaranteed Income Supplement (GIS). That makes the account a rather lovely home for retirement income, provided investors don’t fill it with one dividend wearing a superhero cape.
An $82,500 example
TELUS (TSX: T) currently demonstrates how a high yield changes the calculation. The company provides wireless, internet, digital-health, and technology services, while expanding into artificial-intelligence (AI) infrastructure through its sovereign AI factories.
First-quarter free cash flow increased 19% to $583 million. TELUS stock expects approximately $2.5 billion in 2026 and targets at least 10% compound annual free cash flow growth through 2028. Its Rimouski AI facility also sold out within months, while another facility is preparing to open in Kamloops.
TELUS stock pays a $0.42 quarterly dividend, or $1.67 annually. At the recent $14.38 share price, that produces an enormous 11.6% yield. An investor would need 5,737 shares to average slightly more than $800 per month, although the cash would arrive quarterly.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | ANNUAL DIVIDEND | ANNUAL TOTAL PAYOUT | FREQUENCY | TOTAL INVESTMENT |
|---|---|---|---|---|---|---|
| T | $14.38 | 5,737 | $1.67 | $9,601.44 | Quarterly | $82,498.06 |
Considerations
TELUS stock sits approximately 38% below its 52-week high because investors remain concerned about debt, intense telecom competition, and dividend sustainability. Management has paused dividend growth, and every future payment still requires board approval. A yield this high is an invitation to investigate, not permission to switch off the brain.
TELUS stock could form one part of a portfolio alongside other sectors, ETFs, and Canadian dividend stocks. Relying on it for the entire $800 would turn one dividend decision into a retirement emergency.
Bottom line
The safer route may require closer to $160,000 or more, built gradually through contributions, reinvestment, and dividend growth. If TELUS stock delivers its free cash flow and debt-reduction targets, however, today’s selloff could help one portion of that future TFSA paycheque grow considerably faster.
