Contrary to its name, the TFSA is not just a savings account where you park cash. It is one of the most powerful tools Canadians have for building long-term wealth. Taxes are the biggest barrier to long-term portfolio growth. So the fact that every dollar of capital gains and dividend income generated within a TFSA is tax-free creates significant opportunities for Canadians.
That’s why how you use your TFSA is so important. If you simply hold cash or investments with low returns, you limit the account’s potential. However, if you invest in high-quality businesses that generate stable income and grow consistently over time, you can turn even a modest $10,000 into something much more meaningful over the years.
The key is finding stocks that offer two things at once: reliable income today and long-term growth potential. This way you are not just waiting for appreciation. You get paid to wait and sit patiently.
So if you have $10,000 or other cash that you want to contribute to your TFSA and put to work in the market, here’s why Brookfield Renewable Partners (TSX:BEP.UN) and Granite REIT (TSX:GRT.UN) are two top choices.
Both offer investors attractive returns, operate high-quality core businesses and each have long-term growth tailwinds that make them ideal core holdings within a TFSA.
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Brookfield is a top choice for green energy for your TFSA
There is no doubt that renewable energy is one of the best industries to invest in over decades of growth. The world is on the brink of a major, decades-long transition to cleaner energy, which offers enormous opportunities for investors.
And not only is Brookfield Renewable Partners perfectly positioned to seize this opportunity, but it is also one of the largest publicly traded renewable energy platforms in the world.
It owns hydroelectric, wind, solar and storage facilities in North America, South America, Europe and Asia. That diversification alone makes the company very resilient. However, what really makes Brookfield a reliable stock to buy and hold for the long term is its cash flow structure.
For example, most of Brookfield Renewable’s power generation is contracted under long-term agreements with utilities and large corporations. This ensures predictable income, even as energy markets fluctuate.
Furthermore, in addition to the compelling long-term growth potential that Brookfield TFSA investors offer, the stock also pays a dividend with a current yield of more than 4.8%. And that dividend is consistently increased by Brookfield.
So if you’re looking for reliable, high-quality stocks to buy in your TFSA and hold for years to come, Brookfield Renewable Partners is easily a top choice.
A top dividend growth stock in the real estate sector
Besides Brookfield, Granite REIT is another no-brainer TFSA stock, especially for investors who want a mix of stability and growth.
Granite owns industrial properties such as logistics and distribution facilities. These are the types of properties that are benefiting from the growth of e-commerce, supply chain expansion and increased demand for storage space, which has allowed Granite to grow so quickly in recent years.
Additionally, Granite also boasts a high-quality tenant base and a strong balance sheet, which only adds to the REIT’s resilience.
Additionally, that strong financial position allows the company to continue developing new properties and expanding its footprint in North America and Europe to keep pace with growing demand for warehouse space.
In addition, Granite, like Brookfield, offers a sustainable and attractive dividend. With the stock trading below $90 per share, the REIT still offers a yield of around 3.9%.
So if you’re looking for high-quality Canadian stocks to buy now that can support your TFSA’s growth for years to come, I’d consider these two stocks quickly before they become even more expensive.
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