The first three quarters of the year have come and gone so quickly. And if you haven’t yet made your 2026 TFSA (Tax-Free Savings Account) contribution, now feels like as good a time as any, especially as 2027 looks to arrive and, with that, another $7,000 (maybe even $7,500 if we’re lucky). Either way, it’s time to start thinking about how to put one’s latest TFSA proceeds to work.
With the month of September (a historically scary, volatile month to invest) out of the way, questions linger as to whether the beginning of the festive season (Canadian Thanksgiving and Halloween right ahead, followed by U.S. Thanksgiving and Black Friday, right before Santa Claus comes to town, perhaps with a Santa rally for investors under the tree) is a good time to invest. As the old saying goes, maximizing time in the market rather than timing the market wins.
Investing with a TFSA, not speculating!
As is typical, though, that’s far easier said than done, especially in today’s slightly expensive, slightly unnerving, and somewhat toppy-looking market, with the TSX Index now down close to 5% from all-time highs. It has been a mild half-correction, to say the least, for Canada’s stock market, but that might be more of a chance to put some of that unused TFSA cash to work, rather than a sign to hit the sell button ahead of the correction or AI bubble burst that many market commentators and talking heads can’t seem to stop talking about.
Personally, I like to keep it simple with index ETFs and very high-quality blue-chip dividend stocks. While some may sense opportunity in the AI trade with the semiconductor stocks in a bit of a slump, I’d much rather stick with boring, profitable simplicity at a time like this. Turns out you don’t need to put your capital at great risk to score a pretty good risk/reward, especially when it comes to some of the top TSX stocks.
In my view, a run-of-the-mill index ETF, such as the Vanguard S&P 500 ETF (TSX: VFV) or the Vanguard FTSE Canadian High Dividend Yield Index ETF (TSX: VDY), is compelling, especially for those who just want to spread their TFSA proceeds across a broad range. Indeed, the S&P or the TSX are great bets for those who don’t want to overthink things.
Enbridge could be a great addition for TFSA income seekers
While I’m skewing on the indexing side this time of year, I do find that individual names, most notably Enbridge (TSX: ENB), are looking very enticing.
And, yes, it’s mostly about that juicy 5.9% dividend yield. Of course, the business itself is on solid footing as the firm looks to move more oil and gas to meet robust demand. What’s most impressive is the longer-term expansion horizon as the utility-like dividend juggernaut keeps delivering on its income and dividend growth promises.
As always, the recent slump (shares are within 2% of a bear market) comes with concerns, most of which, in my opinion, have been priced in at $65 and change per share.
Most notably, operating headwinds (think the Line 5 pipeline) and leadership uncertainty (a new CEO coming in at the start of 2027) are things to watch for. In terms of how it impacts the narrative and dividend trajectory, though, my take is that it’s less of an issue for long-term thinkers. Personally, I’m a fan of Michele Harradine’s track record as she takes the reins in just months’ time.