A million-dollar Tax-Free Savings Account (TFSA) sounds like it belongs to someone already sitting in a snazzy corner office.
Guess what? It doesn’t.
Once annual contribution room sets the ceiling, earning an enormous salary provides no special advantage. A patient investor earning $70,000 can contribute the same amount as a chief executive earning $700,000. The real difference comes from starting early, contributing consistently, and giving investments enough time to compound.
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One need: Time
The 2026 TFSA dollar limit is $7,000. Investors may have additional room carried forward from previous years, although everyone should confirm their personal limit before contributing.
More importantly, investment gains earned inside a TFSA don’t consume contribution room. If a $7,000 investment eventually becomes $20,000, the additional $13,000 hasn’t created an overcontribution. The account can grow well beyond the total amount deposited.
That is how an ordinary annual contribution can eventually produce an extraordinary balance. Consider someone who invests $7,000 at the end of every year. Here’s what several hypothetical average returns could produce:
| AVERAGE ANNUAL RETURN | VALUE AFTER 20 YEARS | VALUE AFTER 30 YEARS | APPROXIMATE TIME TO $1 MILLION |
|---|---|---|---|
| 6% | $257,499 | $553,407 | 39 years |
| 8% | $320,334 | $792,982 | 33 years |
| 10% | $400,925 | $1,151,458 | 29 years |
These are illustrations, not guarantees. Actual returns will bounce around, future TFSA limits may change, and fees can reduce the outcome. Still, the table makes the important point rather loudly: a million-dollar account can come from ordinary contributions given an unusually long runway.
Consider this compounder
One company I’d consider for part of that portfolio is Waste Connections (TSX: WCN). It provides waste collection, transfer, disposal, and recycling services across Canada and the United States.
Garbage collection may lack cocktail-party excitement. It compensates with recurring demand. Homes and businesses continue producing waste whether the economy is booming or merely struggling to find pockets of growth.
Waste Connections also concentrates heavily on secondary markets and locations where it can secure exclusive or highly defensible operating positions. Route density allows each truck to serve more customers efficiently, while landfills and transfer stations are difficult and expensive for new competitors to duplicate.
Growth keeps coming
Earnings paint the picture clearly. Second-quarter revenue increased 6.4% year over year to US$2.6 billion. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 6.8% to US$840.1 million.
Management subsequently raised its full-year outlook and continued acquiring smaller operators. That combination of organic price increases, operating efficiency, and acquisitions has helped Waste Connections stock become one of the more dependable Canadian growth stocks.
Considerations
Dependable doesn’t mean cheap. At a recent price near $223, the shares trade around 39 times trailing earnings. Investors are already paying for years of competent execution.
That premium valuation is the clearest risk. Slower growth, poorly integrated acquisitions, or unexpected landfill expenses could cause the earnings multiple to contract even if the underlying company remains profitable. A wonderful business can still become a disappointing investment when bought at absolutely any price.
I’d therefore build a position gradually and hold it alongside companies from other sectors and regions. Regular TFSA contributions make that easier, since investors can add during both exciting rallies and less exhilarating declines.
Bottom line
A million-dollar TFSA doesn’t require a million-dollar salary. It requires sufficient contribution room, decades of consistency, and investments that can compound faster than cash.
Waste Connections stock offers recurring demand and a proven acquisition strategy, although its premium valuation makes diversification essential. Contributing $7,000 annually won’t feel like a millionaire-making decision during the first few years. Given enough time, however, those thoroughly ordinary deposits can produce a decidedly unusual result.
