Supplementing your income with dividends is a smart way to earn greater wealth over time. It’s not a get-rich-quick scheme, it’s one that requires patience and discipline. In the long run, the passage of time and the compounding of returns will likely allow you to accumulate more wealth than you can imagine.

In this article, I’ll take a look at Capital Power Corp. (TSX:CPX) stock, a growth-oriented power producer that has been providing shareholders with strong total returns over the last 10 years – in the form of both dividends and capital appreciation.

Capital Power – A brief history

For starters, let’s look back for a brief review of Capital Power. This background can help build the case for Capital Power shares.

The company was created in July 2009 to separate Epcor Utilities Inc.’s generation business into a new, publicly-traded independent power producer. Since then, the company has consistently followed a business model that focuses on generating stable and growing cash flows from a contracted and merchant power generation portfolio.

Today, Capital Power is focused on natural gas-fired generation, which involves burning methane to create electricity. This is the cheapest and quickest form of energy, with a booming demand profile. With a 90% natural gas weighting, the company has positioned itself to benefit from this surge in power demand.

Since 2009, the company has grown capacity by more than four times. This means that the power producer has greater scale and diversity to lead it into the next few years.

CPX stock on the TSX

At this time, Capital Power stock is yielding a generous 4.1%. This dividend is supported by strong cash flows, a strong balance sheet, and a growing business. And Capital Power has a variety of opportunities to continue to grow.

For example, power prices and spreads are increasing rapidly. As such, there’s a vast opportunity for re-contracting at much better terms. This is resulting in contracts with higher pricing and longer duration. As an illustration of the kind of value that this has to the company, I’d like to single out two recent re-contracting results.

The first is the Midland Cogeneration Venture in Michigan. Last year, the company signed new contracts for this facility which resulted in an 85% lift in its earnings before interest, taxes, depreciation, and amortization (EBITDA). Similarly, the company entered into a new contract for its Arlington Valley facility, at 140% above the existing contract.

Over and above this, the power producers will continue to benefit from the unprecedented rise in energy demand that’s expected in the coming years. In 2025, its adjusted EBITDA increased 18% to $1.6 billion and its adjusted funds flow from operations increased 29% to $1.1 billion. This is evidence that the company’s current strategy and macro backdrop is working in its favour.

How much to invest in CPX stock for $1,000 in annual dividends

So, in order to receive $1,000 in annual dividends from CPX stock, we must buy 362 shares. To be exact, this would give you $1,001.57 in dividend income. Considering that CPX’s stock price is currently trading at $66.87, this requires an investment of approximately $24,200.

The bottom line

As one of the lesser-known utility stocks, Capital Power has clear advantages. It’s rapidly growing, consistent results will continue to support a growing dividend and share price. Currently CPX’s stock price is trading at a mere 20 times next year’s expected earnings. With a dividend yield of 4.1%, this is a utility stock to consider for your dividend income needs.

The post How Many Capital Power Shares Would it Take to Earn $1,000 in Annual Dividends? appeared first on The Motley Fool Canada.

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Fool contributor Karen Thomas has no position in any of the stocks mentioned. The Motley Fool recommends Capital Power. The Motley Fool has a disclosure policy.

Passive income has become increasingly important in today’s uncertain economic environment, shaped by ongoing geopolitical tensions, persistent inflation, and workforce restructuring driven by rapid AI adoption. Building reliable passive income streams not only enhances financial stability but also helps investors achieve their long-term financial goals more efficiently. Reinvesting these regular payouts can further accelerate wealth creation through compounding.

One of the most convenient and cost-effective ways to generate passive income is to invest in high-yield, monthly-dividend-paying stocks. These investments provide consistent cash flow while reducing reliance on market timing. Moreover, holding such investments in a Tax-Free Savings Account (TFSA) allows investors to earn and reinvest dividend income tax-free, thereby maximizing overall returns.

Against this backdrop, here are two top monthly-paying stocks that stand out as compelling additions to a TFSA portfolio right now.

SmartCentres Real Estate Investment Trust

Real estate investment trusts (REITs) are required to distribute at least 90% of their taxable income to unitholders, making them particularly attractive for income-focused investors. Against this backdrop, SmartCentres Real Estate Investment Trust (TSX:SRU.UN) stands out as a compelling option. The REIT owns and operates 198 strategically located properties across Canada and benefits from a high-quality tenant base, with approximately 95% of tenants having regional or national footprints. Notably, about 60% of its tenants provide essential services, helping maintain stable occupancy levels regardless of broader economic conditions.

In addition to its resilient occupancy, ongoing lease renewals and new leasing activity – combined with solid rent growth – should continue to support its financial performance. This strength enables the REIT to maintain attractive distributions, currently offering a monthly payout of $0.1547 per unit, which translates to a forward yield of about 6.8%.

Looking ahead, despite macroeconomic pressures and elevated costs, demand for retail real estate remains firm, partly due to constrained new supply amid high construction expenses. This environment positions SmartCentres well to benefit, especially given its robust development pipeline of approximately 87 million square feet, including about 0.8 million square feet currently under construction.

Given its stable occupancy, strong tenant mix, and long-term growth initiatives, SmartCentres appears well-positioned to continue delivering reliable monthly income, making it an attractive choice for investors seeking consistent passive income.

Pizza Pizza Royalty

Another attractive monthly-paying Canadian dividend stock offering a yield above 6% is Pizza Pizza Royalty (TSX:PZA). The company operates 694 Pizza Pizza restaurants and 100 Pizza 73 locations through its franchise network and generates revenue by collecting royalties based on franchisee sales. This asset-light model insulates its financials from direct exposure to rising input costs, such as food prices and labour wages.

Additionally, the company aims to provide stable, predictable returns by maintaining consistent monthly distributions despite the restaurant industry’s seasonal nature. Its current monthly payout of $0.0775 per share yields 6.03% on a forward basis.

Looking ahead, PZA continues to expand its footprint and expects to grow its traditional restaurant count by 2–3% this year. At the same time, ongoing initiatives – including menu innovation, enhancements to its digital ordering experience, and a continued focus on restaurant renovations – are likely to support same-store sales growth.

Given these strategic initiatives and the stability of its royalty-based revenue model, PZA appears well-positioned to sustain its dividend payouts in the coming years, making it an excellent choice for income-focused investors.

The post 2 TSX Stocks That Turn Dividends Into Reliable Monthly Paycheques appeared first on The Motley Fool Canada.

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Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned. The Motley Fool recommends SmartCentres Real Estate Investment Trust. The Motley Fool has a disclosure policy.

A $14,000 investment in high-quality dividend stocks can help build a steady stream of passive income. The strategy becomes even more powerful when those investments are held within a Tax-Free Savings Account (TFSA). Because any dividends earned or capital gains realized in a TFSA are completely tax-free, investors can keep the full value of their returns and allow their capital to compound more efficiently over time.

For investors seeking passive income, focus should be on TSX stocks with dependable dividend histories. These Canadian companies generate consistent and predictable cash flows and are better equipped to maintain and grow their distributions, even during periods of market volatility.

With these considerations in mind, here is a dividend-paying TSX stock that stands out as a strong investment for passive income investors. Based on its recent closing price and dividend yield, allocating $14,000 to this dividend stock could generate $725.6 in annual passive income.

Top passive income stock: Enbridge

Enbridge (TSX:ENB) stock is a compelling option for investors seeking dependable passive income within a TFSA. It offers an attractive dividend yield of 5.2% and has a long history of consistent distributions, making it a reliable income stock.

Notably, Enbridge has consistently paid dividends for more than 70 years and has shown a strong commitment to dividend growth. Since 1995, the energy infrastructure company has raised its dividend by about 9% per year. This sustained track record reflects ENB’s ability to navigate commodity cycles and varying economic conditions while continuing to return capital to investors.

Supporting Enbridge’s consistent dividend payments is its low-risk, diversified business model. The company generates cash flow from a highly diversified network of energy infrastructure assets, which helps reduce earnings volatility and drives distributable cash flow (DCF). A substantial portion of Enbridge’s EBITDA is derived from regulated operations or long-term take-or-pay contracts, limiting direct exposure to commodity price fluctuations and providing a predictable revenue base that supports its dividend program.

Further, much of Enbridge’s EBITDA is tied to inflation-adjusted agreements, which can help offset rising costs and support cash flow expansion over time.

Enbridge’s extensive energy infrastructure network further strengthens its position. The company’s pipelines and related assets connect major supply regions with key demand centres across North America. This results in strong asset utilization and positions the company to benefit from ongoing energy demand.

Overall, Enbridge is a top stock for TFSA investors seeking worry-free passive income for years to come.

Make $725.60/year in tax-free passive income

Enbridge is well-positioned to sustain its dividend growth streak in the years ahead. Its diversified revenue streams, high utilization of infrastructure assets, and largely low-risk, contract-based operating model support stable growth in distributable cash flow (DCF) per share, creating a reliable foundation for consistent dividend payments and future increases.

Over the past five years, Enbridge has returned roughly $38 billion to shareholders through dividends. Moreover, management expects to distribute between $40 billion and $45 billion during the next five years, supported by expanding regulated and contracted cash flows. Its targeted DCF payout ratio of 60% to 70% appears sustainable, allowing ENB to balance shareholder returns while retaining sufficient capital to fund future growth initiatives.

Enbridge is expected to benefit from accretive brownfield investments that expand or optimize existing infrastructure. These projects carry lower execution risk and benefit from favourable energy market fundamentals. In addition, Enbridge’s secured capital backlog of $39 billion provides long-term visibility into earnings growth and cash flow stability.

Beyond its traditional operations, Enbridge stands to benefit from structural shifts in the broader energy landscape. Rising electricity demand and ongoing energy transition initiatives are expected to create additional opportunities for infrastructure investment and expansion.

At the current dividend rate, an investment of $14,000 in Enbridge stock would allow an investor to acquire approximately 187 shares. Based on the company’s current payout, this position would generate about $181.39 in quarterly dividend income, or roughly $725.60 in annual passive income.

The post TFSA: Invest $14,000 in This TSX Stock and Create $725.60 in Annual Passive Income appeared first on The Motley Fool Canada.

More reading

• 3 Stocks I’d Buy Today and Hold Comfortably All the Way to 2031
• My Top Canadian Dividend Stocks You’ll Want to Own Forever
• How to Build a $50,000 TFSA That Throws Off Nearly Constant Income
• A Year After the Rate Pivot – Here Are 2 Canadian Stocks I’d Still Buy Now
• How to Bridge the Gap When CPP and OAS Won’t Cover Your Expenses 

Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends Enbridge. The Motley Fool has a disclosure policy.

Last year, BCE Inc (TSX:BCE) investors had a rude awakening when they read the earnings release for the fourth quarter of 2024. In the release, the company said that it had been forced to cut its dividend from $0.99 to $0.49, owing to a negative economic outlook. The stock plunged after the news came out.

While BCE’s press release used phrases like “unsupportive policy environment” and “global recession fears” to justify the dividend cut, the reality was that the dividend payouts had simply gotten too expensive. Paying out more in dividends than it earned in profits, BCE did what it would have had to sooner or later.

BCE Inc’s 2025 dividend cut reveals the perils of high yield investing. Too often, a high yield today transforms into a low yield and a plunging stock price tomorrow. Nevertheless, there are responsible companies out there paying dividends that are both high and well supported by earnings. In this article, I’ll explore three of them.

Rogers Communications

Rogers Communications Inc (TSX:RCI.B) is a Canadian telco stock with an admirably low 13.2% payout ratio. This ratio comes from the fact that the company paid out $913 million in dividends last year on $6.9 billion in earnings. Despite the low payout ratio, RCI.B actually has a fairly high dividend yield: 4.2%. When a stock has a low payout ratio and a high yield simultaneously, that it is a good sign that it is cheap in fundamental terms.

Indeed, RCI.B does appear to be a cheap stock, going by valuation multiples. At Monday’s closing price, the stock traded at 9.5 times earnings, 1.2 times sales, 1.5 times book, 4 times operating cash flow, and 12.4 times free cash flow (FCF). These multiples are far below average for the TSX as a whole. They also compare favourably to Rogers’ competitors BCE and Telus.

Why is Rogers stock so cheap? Most likely, because of the sector-wide issues in Canadian telcos as a whole. As mentioned previously, BCE has been cutting its dividend. Also, these companies are not growing their earnings very much. Nevertheless, a cheap enough stock can be worth it without growth: RCI.B seems to fit that description.

TD Bank

The Toronto-Dominion Bank (TSX:TD) is a Canadian bank stock with a 3.2% dividend yield. Early last year, the yield was approaching 6%, but it got smaller after a large increase in the stock price. Despite the higher price and lower yield, TD is probably a half-reasonable hold today. The company is growing both its revenue and earnings at commendable paces, contrary to predictions that it would not be able to after having its U.S. retail assets capped by the U.S. Department of Justice (DoJ). Despite the growth, it still trades at a “decent” 15 times adjusted earnings and 1.9 times book – lower than the North American market averages. Personally, I’m very comfortable holding TD even after its massive 2025 rally.

Fortis

Last but not least we have Fortis Inc (TSX:FTS). This is a Canadian utility stock with a 3.3% dividend yield and a 73% payout ratio. A payout of 73% is much higher than the other two stocks’ payout ratios, but it is relatively low for a utility stock. Utilities are well known for pushing it with their dividend payouts, in many cases paying out well over 100% of what they earn. This in some cases results in dividend cuts, as we saw at Algonquin Power & Utilities Corp (TSX:AQN) a few years back. Fortis usually maintains its dividend payouts within reason, and that helps it run a much smoother ship than the average TSX utility stock. Over long periods of time, it also results in superior total returns.

The post 3 TSX Dividend Stocks With Payout Ratios That Actually Hold Up to Scrutiny appeared first on The Motley Fool Canada.

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Fool contributor Andrew Button has positions in TD Bank. The Motley Fool recommends Fortis, Rogers Communications, and TELUS. The Motley Fool has a disclosure policy.

Long-term investing remains a highly effective strategy, as it helps investors ride out short-term market volatility while harnessing the power of compounding. At the same time, careful stock selection is crucial – focusing on high-quality companies with strong, well-established businesses. In this context, and given the uncertain outlook driven by ongoing tensions in the Middle East, the following three stocks stand out as attractive buying opportunities for long-term investors.

Fortis

Fortis (TSX:FTS) operates a highly regulated utility business, with about 95% of its assets tied to the low-risk transmission and distribution of electricity and natural gas. The company serves roughly 3.5 million customers across the United States, Canada, and the Caribbean, benefiting from the essential nature of its services.

This stability, combined with a steadily expanding asset base, has supported consistent financial growth, driving both share price appreciation and reliable dividend increases. Over the past two decades, Fortis has delivered an average annual total shareholder return of approximately 10.5%. It has also raised its dividend for 52 consecutive years and currently offers an attractive yield of around 3.3%.

Looking ahead, Fortis is well-positioned to capitalize on rising energy demand driven by economic growth, increased investment in AI-ready data centres, and the ongoing electrification of transportation. The company plans to invest $28.8 billion through the end of the decade, targeting a 7% annual growth in its rate base to reach $57.9 billion. Alongside these expansion initiatives, continued cost optimization and efficiency improvements should support steady earnings growth. Backed by this outlook, Fortis expects to grow its dividend by 4–6% annually through 2030, reinforcing its appeal as a reliable long-term investment.

Enbridge

Enbridge (TSX:ENB) operates an extensive pipeline network that transports oil and natural gas across North America under a tolling framework and long-term take-or-pay contracts. In addition, it owns three natural gas utility businesses and a growing portfolio of renewable energy assets supported by long-term power purchase agreements (PPAs). With nearly 98% of its earnings derived from cost-of-service and contracted cash flows – and about 80% indexed to inflation – its financial performance remains relatively resilient to economic cycles and market volatility.

Backed by this stable business model, the Calgary-based company has delivered an average annual total shareholder return of around 13% over the past 20 years. It has also increased its dividend for 31 consecutive years and currently offers an attractive yield of around 5.2%.

Despite the global transition toward cleaner energy, oil and natural gas could remain key components of the energy mix for years to come. Rising oil and natural gas production and demand across North America should continue to support the need for Enbridge’s infrastructure. At the same time, the company has identified approximately $50 billion in growth opportunities and plans to invest $10–$11 billion annually to advance these projects.

Amid these expansion initiatives, management expects adjusted earnings per share (EPS) and discounted cash flow (DCF) per share to grow at a steady, single-digit pace in the coming years. Supported by these solid growth prospects, Enbridge appears well-positioned to continue increasing its dividend, making it a compelling long-term investment.

Dollarama

My final pick is Dollarama (TSX:DOL), a leading discount retailer that has delivered an impressive 500% return over the past decade, representing an annualized gain of about 19.6%. Through its efficient direct-sourcing model and strong logistics network, the company has kept costs low, allowing it to offer a wide range of products at attractive price points. This value proposition drives consistent customer traffic, regardless of broader economic conditions, supporting steady financial growth and share price appreciation.

Looking ahead, Dollarama continues to expand its footprint and plans to increase its Canadian store count from 1,691 to 2,200 by fiscal 2034. It is also growing its presence in Australia, with the store count expected to rise from 401 to 700 during this period. In addition, increasing contributions from its investments in Central American Retail Sourcing (CARS) and Inversiones Comerciales Mexicanas (ICM) should further support its long-term growth.

Given these multiple growth drivers, Dollarama appears well-positioned to continue delivering solid returns over the next five years, making it an attractive addition to a long-term investment portfolio.

The post 3 Stocks I’d Buy Today and Hold Comfortably All the Way to 2031 appeared first on The Motley Fool Canada.

More reading

• TFSA: Invest $14,000 in This TSX Stock and Create $725.60 in Annual Passive Income
• 3 TSX Dividend Stocks With Payout Ratios That Actually Hold Up to Scrutiny
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Fool contributor Rajiv Nanjapla has no position in any of the stocks mentioned. The Motley Fool recommends Dollarama, Enbridge, and Fortis. The Motley Fool has a disclosure policy.

As geopolitical uncertainties continue to take a toll on investor sentiment in 2026, it could be a wise decision to add quality Canadian dividend stocks to your portfolio. The good news is that the Toronto Stock Exchange is home to some of the most attractive dividend payers, offering a mix of stability and growth potential.

Let’s dive into two top TSX-listed companies known for their generous dividends and see if these high-yielders are worth your investment.

Mullen stock

Mullen Group (TSX:MTL) is a logistics provider with a diversified portfolio of services, including less-than-truckload, logistics and warehousing, specialized and industrial services, and U.S. and international logistics. The company operates through multiple segments that cover different areas of the transportation industry. Currently trading at $17.33 per share, Mullen Group has a market cap of $1.7 billion. Over the last year, its stock has appreciated by 35%, reflecting strong investor confidence. The company offers a monthly dividend with a yield of 4.9%.

Mullen Group’s recent performance has been supported by strategic acquisitions and operational efficiencies. In its latest earnings report, the company posted revenue growth of 7% YoY (year-over-year) to $533.8 million, driven mainly by contributions from newly acquired businesses like Cole International Inc. and Pacific Northwest Moving (Yukon) Limited. However, its OIBDA (operating income before depreciation and amortization) declined by 13.6% to $73.4 million due to lower margins in the Less-Than-Truckload and Specialized & Industrial Services segments. Even so, its diversified business model continues to help it navigate economic cycles while maintaining a solid financial position.

Meanwhile, Mullen Group remains focused on long-term growth by expanding its service offerings and improving operational efficiency. Its disciplined management approach and ongoing acquisitions could support future earnings growth.

Plaza Retail REIT

Plaza Retail REIT (TSX:PLZ.UN) is an open-ended real estate investment trust (REIT) focused on retail properties across Ontario, Quebec, and Atlantic Canada. The company holds interests in around 211 properties, covering approximately 8.9 million square feet. It currently trades at $4.25 per unit with a market cap of $469.4 million. Over the last 12 months, its stock has gained 12.4%, showing resilience despite broader market volatility. It offers a monthly dividend with a yield of 6.6%.

In its latest earnings report, Plaza posted an 8.8% YoY increase in FFO (funds from operations) to $44 million, or $0.395 per unit, for the year ended December 2025. This growth came from both the same-asset performance and newly acquired properties. Despite some tenant-related challenges, committed occupancy remained strong at 97.6%, while leasing spreads stood at 13.4%. Its development and intensification projects also added about $3 million in incremental NOI (net operating income) during the year.

Going forward, Plaza Retail REIT plans to continue optimizing its portfolio through acquisitions and development projects. Its strong fundamentals and focus on essential retail tenants support its long-term outlook. With a high yield and reliable payouts, it remains an attractive option for income-focused investors.

Foolish takeaway

Clearly, high-yield dividend stocks could play an important role in building long-term wealth. Mullen Group and Plaza Retail REIT offer attractive yields backed by solid business fundamentals. While both companies face their own challenges, their growth strategies and disciplined execution make them worth considering for long-term Foolish Investors seeking steady income and potential upside.

The post Are the Highest-Paying Dividend Stocks on the TSX Actually Worth Buying? appeared first on The Motley Fool Canada.

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Fool contributor Jitendra Parashar has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends the Mullen Group. The Motley Fool has a disclosure policy.

Building a strong long-term equity portfolio does not necessarily require a large initial investment. Investors can begin by consistently allocating capital to high-quality TSX stocks trading at relatively low prices, say priced under $20. Over time, this disciplined approach can help accumulate meaningful wealth through compounding and sustained market participation.

The key is to focus on fundamentally strong businesses with durable competitive advantages and solid growth prospects. Focus on companies with the ability to scale profitably and adopt a buy-and-hold approach to minimize the impact of short-term market volatility.

With this background, here are two TSX stocks priced under $20 that look worth picking up today.

Under $20 stock #1: CES Energy Solutions

Investors looking for high-quality stocks priced under $20 could consider CES Energy (TSX:CEU). The company supplies consumable chemical solutions used by oil and gas producers to enhance production, improve operational efficiency, and protect critical upstream infrastructure.

Demand for CES Energy’s advanced chemical products has remained strong, supporting a notable rise in its share price. The stock has gained about 193% over the past year and more than 594% in three years. Despite this significant rally, CES Energy stock has meaningful upside potential as industry demand dynamics remain solid.

CES maintains a strong market share and continues to benefit from elevated service intensity, which has supported revenue growth even as rig counts in the U.S. and Canada have softened. Strategic acquisitions have also strengthened CES Energy’s capabilities, improving financial performance and supporting continued expansion. At the same time, the company operates with an asset-light business model, enabling it to generate consistent free cash flow that supports reinvestment and shareholder returns.

Notably, broader industry factors, including global energy demand, LNG expansion, AI-driven power consumption, and limited upstream investment in recent years are increasing the need for advanced chemical treatment and improved drilling performance. This should support CES Energy’s growth.

Although economic uncertainty, geopolitical tensions, and trade policies may create short-term volatility, CES Energy’s large U.S. revenue base, vertically integrated operations, and flexible supply chain help mitigate these risks. Overall, the company appears well-positioned to sustain its growth trajectory into 2026 and beyond.

Under $20 stock #2: Dexterra

Dexterra (TSX:DXT) is another attractive stock priced below $20. The company provides integrated facilities management services, workforce accommodation solutions, and a range of support services across multiple end markets.

Over the past three years, Dexterra has delivered impressive performance, with its stock registering total capital gains of approximately 176%. This strong rally reflects the company’s solid financial results and the impact of its strategic acquisitions. In addition, Dexterra has returned capital to shareholders through dividend payments and share buybacks.

The company continues to strengthen its platform through targeted investments. Its acquisition of Pleasant Valley Corporation (PVC) expands Dexterra’s facilities management presence in the U.S., increasing scale and improving access to a large outsourced services market with a robust growth pipeline. This move supports the company’s broader strategy of expanding its footprint in key markets while building long-term service capabilities.

Dexterra has also enhanced its growth outlook through the acquisition of Right Choice. The transaction provides an immediate boost to revenue and adjusted EBITDA while adding a high-quality workforce accommodation equipment fleet. Much of this fleet remains underutilized, offering additional capacity that can support future expansion as demand grows.

Looking ahead, management remains focused on driving profitable growth, particularly in the U.S., where outsourcing opportunities remain substantial. At the same time, higher utilization within the company’s asset-based services business is expected to support further earnings growth.

Overall, Dexterra’s strong operational performance, disciplined acquisition strategy, and commitment to shareholder returns position the company well to deliver continued capital appreciation and meaningful cash returns to investors.

The post 2 TSX Stocks Priced Under $20 That Look Worth Picking Up Today appeared first on The Motley Fool Canada.

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Fool contributor Sneha Nahata has no position in any of the stocks mentioned. The Motley Fool recommends CES Energy Solutions and Dexterra Group. The Motley Fool has a disclosure policy.

According to Statistics Canada’s TFSA data, the average TFSA balance of those below age 50 was 20–27% of their cumulative contribution (CC) room. However, this figure spiked to 34% at age 50 and kept increasing. For calculation reasons, we took the start of the age range to determine the contribution room. For the age 30–34, the CC is for those who turned 30 in 2023.

What changed at age 50 is that their TFSA balance increased significantly.

We looked at data from the pandemic years, and the average TFSA balance of 50-year-old Canadians was in the range of 30% of their CC.

How much does a typical 50-year-old Canadian have in their TFSA?

At 50, Canadians significantly increased their TFSA contributions to $11,051 from contributions of $9,737 made by Canadians in the 45-49 age group. While the average TFSA withdrawals are close to contributions, it was the investing income that spiked the TFSA fair market value (FMV). Because the total TFSA FMV jumped from $32.6 billion in the 45-49 age group to $40.4 billion in the 50-54 age group. Such a remarkable jump in TFSA contributions and FMV is visible at age 25 as well.

In 2023, a typical 50-year-old Canadian had $30,190 in their TFSA, which is just 34% of the cumulative contribution room they had in 2023. In 2026, this contribution room has surged to $109,000. If Canadians maintained the 34–38% ratio, they would have a TFSA balance of $37,000–$41,400 in 2026.

Age 50 is a warning bell to up your savings game and start saving aggressively for retirement. At 50, you are at your career peak, and major expenses like house, education, and marriage are behind you. How much should you invest in a TFSA to catch up to your retirement portfolio?

How much should you invest in the TFSA?

Honestly, among all the registered retirement accounts, the TFSA has the best benefit. It gives you the flexibility to withdraw tax-free. The CRA also adds back withdrawals to the contribution room on January 1 of the next year. Whether to contribute what you withdrew is a choice and not an obligation. The only obligation a TFSA puts on you is that you can’t over-contribute, and you can only invest in renowned and well-regulated investment instruments.

At 50, Canadians should start using the unused TFSA contribution room. The average unused TFSA contribution room was $57,855 in the 2023 tax year. Any bonus or capital gain can be diverted to a TFSA.

When investing through a TFSA, look for high-growth stocks as you still have 10 years to build a significant balance. Shopify (TSX:SHOP) is a perfect TFSA stock as it can give you 50% annual growth if you follow the seasonal trend of buying in March-April and selling in November and February. The most profitable investing strategy for Shopify is rebalancing 80% and holding 20% for the long term.

Suppose you buy 100 shares of Shopify for $165 now and hold 20 shares for the long term. The remaining 80 shares can be used for rebalancing and accumulating. Suppose the stock price rises to $250 in November, you can sell 80 shares costing $13,200 for $20,000 and book a profit of $6,800. This $20,000 can be reinvested to buy Shopify shares in March, probably for $180. Even though the cost has increased, it will buy you 111 shares and increase your share count to 131 (111 + 20 shares in reserve). You have got 31 shares from compounding.

The post What a Typical 50-Year-Old Canadian Actually Has in Their TFSA  appeared first on The Motley Fool Canada.

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The Motley Fool has positions in and recommends Shopify. The Motley Fool has a disclosure policy. Fool contributor Puja Tayal has no position in any of the stocks mentioned.

TD Bank (TSX:TD) is fresh off one of the best years it’s had in a very long time. Undoubtedly, just when you think it’s time to give up on the Big Six Canadian banks, they go ahead and post an incredible year. And while the momentum has since slowed, don’t expect the pace of generous dividend hikes or earnings beats to follow suit. If anything, any period of sideways action or bumps in the road might serve as an opportunity for income investors to top up their positions.

Things are looking up for TD stock in 2026

Even in the face of geopolitical crisis and another inflationary shock to the system, the banks have what it takes to hold their own and keep on paying those generous dividends out as usual.

As airlines slap on fuel surcharges and prices at the pump start looking to record highs, perhaps it’s best for investors to give the big banks the benefit of the doubt, even if there is a bit more uncertainty regarding where interest rates will land by year’s end.

In any case, the outlook for TD stock remains very good, at least in my view. The bank was once the least-loved of the cohort, thanks in part to the money-laundering woes and penalties that followed. Now, investors are focused on the actual results, which have been solid, as well as the road ahead under its fantastic new CEO, Raymond Chun.

TD Bank is still way too cheap

Of course, Mr. Chun may have stepped in at the right time, as TD Bank and the rest of the Big Six proceeded to make up for lost time. But with a fantastic game plan, which could keep TD Bank going strong, I see potential for significant earnings growth as well as upside potential for the multiple, which still looks quite discounted relative to the peer group.

At the time of this writing, shares of TD Bank trade at 10.8 times trailing price-to-earnings (P/E). That’s cheap, arguably too cheap in an environment where it’s become quite normal to pay closer to 15 times trailing P/E for a big Canadian bank stock.

TD Bank might still have a lot of hurdles in the U.S. market, but I do think that the bank can continue to grow despite its U.S. asset cap. The bank has extra capital to spend on share repurchases and investments in technology (most notably AI). Even without growing assets in the U.S. market, there’s no reason why the bank can’t still grow its earnings, especially as AI automation and cost cuts pave the way for a better, sustained margin mix.

Tech and efficiencies could drive earnings higher

Such technological advancements can also boost the customer experience and drive meaningful efficiency alpha. In prior pieces, I’ve praised TD Bank for its tech-savvy. In the AI age, effective utilization of technology, I think, can separate winners from the losers. In any case, TD Bank is already on the cost savings track. And as its returns on equity march even higher, I think it’s about time that investors start viewing TD Bank as a stock worthy of a premium again.

As efficiency ratios look to improve while investors start to move on from the regulatory discount still attached to the name, I can’t help but think that 2026 could be another upbeat year for the bank, even if the rest of the market sinks into a correction or worse.

The post 2026 Outlook for TD Stock appeared first on The Motley Fool Canada.

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Fool contributor Joey Frenette has positions in Toronto-Dominion Bank. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

After a rocky start to 2026, Canadian investors who haven’t yet bought shares on the way down might want to start putting together a shopping list, just in case the TSX Index and S&P 500 aren’t out of the woods quite yet. Undoubtedly, it’s impossible to know when and how the Iran war will end. And, with that, investors should be ready for any kind of market reaction, whether that’s calm or another scare, as the Federal Reserve in the U.S. (or Bank of Canada on this side of the border) looks to make a big pivot on its interest rate policy.

Indeed, it felt like rate cuts were completely off the table at the end of last year. Now, it’s rate cuts that might be shelved as more things add to the inflationary pressures that could propel the price of food, fuel, electronics (thanks to AI-driven price increases on dynamic random access memory and solid state drives), flight tickets, and many other goods markedly higher from current levels. We really do need a break from inflation, but with oil prices rocketing higher and AI continuing to impact everything from gaming consoles to laptop parts, it feels like more pain for our wallets is in the cards.

In any case, investors should consider what long-lasting inflation on a broader basket of goods could mean for one’s nest egg. If you’re a cautious investor who’s too heavy on cash, the opportunity cost of holding that cash could grow higher again.

And, with that, the case for investing in dividend payers, I believe, increases. In this piece, we’ll concentrate on the kinds of dividend stocks that, in my opinion, are still worth your time and investment dollars. They’ll pay you to wait, and hopefully, they’ll help you offset some of the blow of the inflation that exists today and the potentially worse inflation to come tomorrow.

Bank of Nova Scotia

Bank of Nova Scotia (TSX:BNS) stock has been on quite a run, now up more than 42% in two years. And while the dividend is smaller, the price-to-earnings (P/E) is on the larger end of the past-decade-long historical range, I still think it’s a good time to be a buyer.

The 4.5% yield, while not towering, is still solid and enough to help any investor through another inflation hailstorm, the likes of which we may not have encountered since the months and quarters that followed the reopening from COVID-era lockdowns. What’s more, though, is that Bank of Nova Scotia’s dividend is on the high-growth track. With the bank getting the green light to repurchase up to 15 million shares, I think it’s time to get serious about what could be one of the last bountiful bargains in this market.

The shares go for 14.5 times trailing price-to-earnings (P/E), which isn’t all too bad considering the price that 4–5% yielders go for nowadays. Add the strategic acceleration into the equation, as well as the venture south of the border, and BNS stock stands out. And, as a Canadian bank with a considerable amount of energy banking business, Bank of Nova Scotia is well-equipped to navigate an energy shock.

With shares coming in more than 7%, I’d look to buy on a further pullback, especially considering BNS may very well be the dividend growth name to help batten down the hatches amid what could evolve to become an oil crisis, or even a mild stagflationary environment.

The post A Canadian Stock I’d Move Quickly to Buy on a TSX Pullback appeared first on The Motley Fool Canada.

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Fool contributor Joey Frenette has no position in any of the stocks mentioned. The Motley Fool recommends Bank of Nova Scotia. The Motley Fool has a disclosure policy.