My #1 Forever TFSA Stock and Why I’ll Never Let it Go

If the Tax-Free Savings Account (TFSA) is an investment account for life, it deserves a stock that users can also hold forever. This symmetry could likewise lead to the creation of generational wealth that TFSA investors can pass on to beneficiaries or heirs.

Bank of Montreal (TSX:BMO) is the logical lifelong companion for your portfolio and also my top forever TFSA stock. Read on to discover why this big bank is for keeps and why I plan to never let it go.  

Oldest bank

BMO isn’t just Canada’s oldest financial institution but living proof of the country’s resilience. The bank survived two World Wars and endured the Great Depression. It emerged stronger in the wake of modern headwinds, including the 2008 global financial crisis and the 2020 global pandemic.

Moreover, the regulatory regime ensures the financial sector’s solvency and stability. Stricter capital requirements and prudent lending standards by the Office of the Superintendent of Financial Institutions (OSFI) prevent excessive risk-taking by Canadian banks.

The OSFI also imposed “NO” dividend hikes and share buybacks during the COVID-19 breakout. A dividend bonanza followed the lifting of restrictions in November 2021. BMO announced a 25% dividend increase.  

TSX’s dividend pioneer

BMO started it all, sharing a portion of earnings with shareholders since 1829. The dividend track record stands at 196 years and counting. This lengthy payment history lends confidence to invest. At $221.14 per share, BMO handily beats the broad market year to date, up 20.6% versus +7.2%. The dividend yield today is 3.16%.

Expanded U.S. footprint

BMO acquired the Bank of the West for US$16.3 billion in February 2023 to become the TSX’s third-largest bank by market capitalization. The $144.9 billion Canadian bank has completed both the system conversion and customer migration. It is now present in 32 states, including the high-end California market. Branch network optimization is ongoing as of this writing.

Artificial intelligence

In April 2026, management announced the establishment of the BMO Institute for Applied Artificial Intelligence & Quantum. The founding director, Dr. Kristin Milchanowski, has been appointed as BMO’s AI and Quantum Officer. The new enterprise-wide institute will focus on responsible innovation, application, and governance of artificial intelligence as well as the development of quantum capabilities.

Latest earnings results

In the first quarter (Q1) of fiscal 2026 (three months ending January 31, 2026), net income increased 16% year over year to $2.5 billion. Notably, provision for credit losses (PCL) declined 26% to $746 million compared to Q1 fiscal 2025. Its CEO, Darryl White, said, “BMO had a very strong start to the year. Building on last year’s momentum, we are executing on our commitments, delivering higher return on equity and double-digit earnings growth.”

“We earned record revenue in each of our operating segments this quarter, with strong fee growth in our market-driven businesses,” White added. Market analysts eagerly await the Q2 fiscal 2026 earnings presentation on May 27, 2026.

High-quality investment

Bank of Montreal is one of the few high-quality stocks worth keeping as a permanent anchor in a TFSA. The big bank is not only a tax-free engine of wealth but also the ultimate source of peace of mind.

The post My #1 Forever TFSA Stock and Why I’ll Never Let it Go appeared first on The Motley Fool Canada.

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More reading

• 3 Canadian Stocks That Could Shine in a Higher-for-Longer Rate World
• How to Build Your Own Pension Using Canadian Dividend Stocks
• 3 TSX Stocks Built for Higher-for-Longer Interest Rates
• Create Your Own Portfolio Dividend Yield With These 3 Incredible TSX Stocks
• 3 Canadian Blue-Chip Stocks to Buy Before the Next Rally

Fool contributor Christopher Liew has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.