Transform Your TFSA Into a Cash-Creating Machine With $14,000

It’s January, which means it’s time to start thinking about the kinds of investments you can buy with your latest (2026) TFSA contribution, which stands firm at $7,000. If you’ve got uninvested cash sitting around in your TFSA savings from last year (that’d be another $7,000) or the year before that, I do think it’s time to take a step back and consider what your longer-term goal is with your TFSA portfolio. Undoubtedly, it’s a terrific growth vehicle that can help growth-minded investors take the power of long-term compounding to the next level.

Whenever you take taxes out of the equation, you could have a powerful snowball builder on your hands, as you look to reinvest dividends or spend them as you see fit. In any case, I believe that younger investors should build their TFSA with long-term growth in mind. Think about the secular winners that can appreciate the most in the next 10, 15, or even 25 years.

Just because appreciation might be a goal of many investors doesn’t mean positioning the account with income generation in mind is a bad idea, especially if you’re entering semi-retirement, full retirement, or just want greater income flexibility.

Your TFSA can be a cash cow if you position it with passive income in mind

At the end of the day, the cash dividends from REITs or income stocks grant you optionality, which might come in handy, especially if 2026 is a big correction year for the markets. In any case, back to the TFSA and a dividend-oriented strategy. For older investors who want a monthly or quarterly income boost, the TFSA can be a great way to score tax-free income. And in this piece, we’ll look at two plays that can help your TFSA average a fairly high yield.

For a $14,000 investment, a 4% yield would grant you $560 in annual income. That’s not a great deal, but, nevertheless, it’s a nice addition to a portfolio that seeks to balance growth with yield. For the more income-hungry, one could average up a yield that’s double that, provided they’re fine with limited capital appreciation potential as well as downside risks (the so-called accidentally high-yielders may not have 8–9% yields by design!).

A 9% yield on $14,000 amounts to just north of $1,200 in income, which is a pretty decent amount, especially for those looking for help with the monthly bills.

Telus is one 9% yielder to stash on the radar

Undoubtedly, when it comes to 9% yielders, Telus (TSX:T) has to come to mind. While I’m not typically a fan of such massive yields, I do think that Telus is a comeback story that’s worth betting on for 2026.

Of course, it’s going to be a volatile ride, as income investors look to catch a bottom in the name. Instead of seeking to get in at rock bottom, though, I think investors should focus on dollar-cost averaging (DCA) over time. If shares dip back below $18 per share, perhaps buying more could make sense, especially as the yield swells back above 9.5%.

While there’s more dividend reduction risk, I would pay careful attention to efforts made by management to shore up financial flexibility. At the end of the day, I still view Telus as a blue chip. It’s a fallen name that’s under serious pressure, but the worst days for the telecoms might just be in the rearview. Now, that doesn’t mean more bad days can’t be ahead, but considering the discounted multiple, I do think shares have become too oversold.

The post Transform Your TFSA Into a Cash-Creating Machine With $14,000 appeared first on The Motley Fool Canada.

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More reading

• A Dividend Giant I’d Buy Alongside Telus Stock Right Now
• Beyond Telus: 2 Canadian Dividend Plays for Smart Investors
• A Canadian Dividend Stock Down 9% to Buy Forever
• Maximum TFSA Impact: 3 TSX Stocks to Help Multiply Your Wealth
• Here Are My Top TSX Stocks to Buy for 2026

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