The Tax-Free Savings Account (TFSA) is one of the best investment vehicles available to Canadian investors. To take full advantage of that account, I turn to some of the best dividend stocks on the market.
These aren’t necessarily the highest-yielding stocks, nor do they offer the fastest growth. Instead, they’re established payers that I have no problem holding for years while letting them compound.
Inside a TFSA, those dividends can be reinvested without creating a Canadian tax bill, allowing both the income and the underlying investment to compound over time.
Here are three of those dividend stocks offering a mix of income, stability, and long-term growth.
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Bank of Nova Scotia offers income and growth
When it comes to picking dividend stocks to own for the long term, Canada’s big bank stocks are always great options to consider. Bank of Nova Scotia (TSX:BNS) isn’t the largest of the big banks, but it does offer attractive income and growth potential.
Scotiabank is known as Canada’s most international bank. The bank has a large international segment that is the focus of its growth efforts. In recent years, that segment has shifted from more volatile Latin American markets to mature markets in North America.
That strategic shift won’t transform the bank overnight, but it could improve profitability and efficiency over time.
Turning to income, Scotiabank offers a yield of 3.7% as of the time of writing. That’s a higher yield than its big bank peers and continues to grow with each year. In fact, Scotiabank has provided annual increases to that dividend for over a decade. The bank has been paying dividends without fail since 1833.
That handily makes Scotiabank one of the dividend stocks to buy and hold in a TFSA for the long term.
Enbridge provides a higher yield
The second of three dividend stocks to own in a TFSA is Enbridge (TSX:ENB). Enbridge is one of the larger energy infrastructure companies in North America.
The company operates a massive pipeline business that transports both crude and natural gas. Enbridge also operates one of the largest natural gas utilities in North America and a growing renewable energy business with assets across the continent and in Europe.
This gives the company a diversified portfolio of largely regulated and contracted assets that generate a recurring revenue base. That revenue stream allows Enbridge to invest in growth initiatives from its multi-billion-dollar backlog and pay a handsome quarterly dividend.
As of the time of writing, that dividend carries a yield of 5.2%, making it one of the better-paying options on the market.
Enbridge has also provided investors with annual upticks to that dividend without fail for three decades.
Canadian National Railway adds long-term dividend growth
Rounding out the three dividend stocks to buy for my TFSA is Canadian National Railway (TSX:CNR). Canadian National is one of the largest railway operators in North America.
Railways transport everything from essentials and raw materials to chemicals, automotive parts, and crude oil. Those goods are connected through Canadian National’s vast network that traverses the continent and connects three coastlines.
This gives the company a large defensive moat and significant diversification appeal. It also means that it would be extremely difficult and expensive to replicate that network.
Turning to income, Canadian National offers a yield of 2% as of the time of writing. That’s lower than the other dividend stocks mentioned above, but the company offers impressive dividend growth.
Canadian National increased its dividend by 3% for 2026, marking its 30th consecutive annual increase. The company also raised its full-year earnings guidance after reporting stronger second-quarter volumes and earnings growth.
This makes the railway a top buy-and-forget option for investors.
Why these 3 dividend stocks belong in my TFSA
No stock is without risk, and that includes the 3 dividend stocks mentioned above. What these stocks do offer investors is a combination of defensive moats, stable dividends, and long-term growth potential.
Together, they create a more balanced long-term TFSA portfolio.
‘In my opinion, one or all of the above could be core holdings in any well-diversified portfolio.
Buy them, hold them, and watch your TFSA (and income) grow.
