3 Dividend Stocks to Reach That $109,000 TFSA Milestone

By Jitendra Parashar at The Motley Fool Canada

For Canadians who were eligible to contribute to a Tax-Free Savings Account (TFSA) since it launched in 2009 and have never missed a contribution, the total contribution room has now reached $109,000 in 2026. And the best part is that any investment gains and dividends earned inside a TFSA can grow tax-free, making it one of the most powerful tools for building long-term wealth.

But simply maxing out your account is only the first step. To unlock its full potential, that money needs to be invested in quality businesses that can deliver reliable dividends and long-term growth.

Here are three TSX dividend stocks that could help turn a fully funded TFSA into a growing source of tax-free income and wealth over time.

Manulife Financial stock

Not many financial stocks could fit a long-term TFSA portfolio as perfectly as Manulife Financial (TSX:MFC). This global insurer and wealth manager operates as Manulife across Canada, Asia, and Europe, and mainly as John Hancock in the United States, giving it a wide base of earnings streams.

At the time of writing, MFC stock traded at $58.81 per share with a market cap of roughly $98 billion. Over the last year, the stock climbed 37%, while still offering a 3.3% dividend yield with quarterly payouts.

In the first quarter of 2026, Manulife posted an 8% year-over-year (YoY) rise in its core earnings to $1.8 billion on a constant exchange rate basis, while its net income attributable to shareholders reached $1.1 billion. At the same time, the firm’s core earnings per share (EPS) rose 11% YoY to $1.06, and new business value improved by 7% from a year ago to $944 million.

With its growing presence in Asia, resilient earnings, and reliable dividend, Manulife stock remains an attractive choice for TFSA investors looking to build tax-free wealth over the long term.

Capital Power stock

Investors who want dividend income backed by rising electricity demand may also want to look at Capital Power (TSX:CPX). The company owns and operates utility-scale renewable and flexible generation assets across Canada and the United States, with about 12 gigawatts of generation capacity at 32 facilities.

Capital Power stock recently traded at $72.31 per share, giving it a market cap of $11.3 billion. It has climbed 33% over the last year and continues to offer a 3.7% dividend yield with quarterly payments.

In its March quarter, Capital Power generated adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of $404 million, net income of $15 million, adjusted funds from operations of $154 million, and operating cash flow of $312 million. The company’s Arlington Valley summer tolling extension also added seven years of contracted revenue and about US$70 million in incremental annual capacity payments by 2032.

Overall, backed by contracted cash flows and rising electricity demand, Capital Power stock offers a compelling mix of dependable dividend income and long-term growth potential for TFSA investors.

Brookfield Renewable stock

For long-term TFSA investors who want to benefit from cleaner energy exposure, Brookfield Renewable Partners (TSX:BEP.UN) could also be a great dividend stock to consider. Its global portfolio includes hydroelectric, wind, solar, distributed generation, storage, and broader decarbonization assets.

After rallying about 29% so far in 2026, Brookfield Renewable currently trades at $47.88 per share with a market cap of roughly $14.7 billion. At this market price, it offers a 4.5% dividend yield with quarterly payouts.

Brookfield Renewable generated funds from operations (FFO) of US$375 million in the latest quarter, up 19% YoY. As a result, its FFO reached US$1.4 billion over the 12 months, up 12% from a year ago. The company’s planned acquisition of Boralex, continued project development, and target of adding 10,000 megawatts annually by 2027 all brighten its long-term growth outlook.

Moreover, its globally diversified renewable energy portfolio, expanding project pipeline, and attractive yield make Brookfield Renewable stock a strong pick for investors seeking long-term tax-free income and growth.

The post 3 Dividend Stocks to Reach That $109,000 TFSA Milestone 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 recommends Brookfield Renewable Partners and Capital Power. The Motley Fool has a disclosure policy.

2026