TFSA Investors: 3 Places to Invest Your $6,000

The TFSA contribution room expands in a few weeks. Investors can add another $6,000 to their accounts to deploy into growth stocks like Docebo (TSX:DCBO)(NASDAQ:DCBO).

The Tax-Free Savings Account (TFSA) contribution room expands within a few weeks. From January, 2021, you may add another $6,000 to this delightfully convenient tax shelter. Here are the top three stocks you can buy with your newly expanded TFSA room. 

TFSA growth stock

If you’re younger and don’t need a steady flow of cash, investing for the long term is probably the best strategy. A solid growth stock that can deliver stunning capital appreciation would be a perfect fit for your TFSA contribution room in 2021. 

Learning management software provider Docebo (TSX:DCBO)(NASDAQ:DCBO) is a top bet. The firm provides a cloud-based platform that allows any enterprise to create educational content. This could be used to create training videos for new employees, tests for interviews, or apps for customer engagement. 

Digital tools like Docebo are rapidly replacing old-school slides and presentations across the corporate world. This year, with everyone working remotely, Docebo’s traction has accelerated. The platform is now used by the likes of Walmart, Amazon Web Services, and Uber.

Currently worth $2 billion, the stock could deliver multifold returns over the next few years. 

TFSA dividend stock

Telecom giant Telus (TSX:T)(NYSE:TU) is always my top pick for a robust dividend stock. Telus offers a 4.85% dividend yield at its current price. That means a $6,000 investment in your TFSA could generate $300 in annual income tax-free!

While there are stocks that offer higher yields than Telus, I believe this company’s payout is safer. Next year, plenty of real estate investment trusts and energy stocks could face turmoil as the economy languishes. The demand for wireless data and broadband, however, should remain steady for the foreseeable future. 

Year to date, Telus stock is flat, which means it preserved shareholder value, despite the pandemic. Now, as the economy reopens, new businesses are launched, and new immigrants arrive, Telus could see user and sales growth. 

TFSA dividend-growth stock

If you’re looking for a TFSA stock that balances income and growth, Fortis (TSX:FTS)(NYSE:FTS) could be ideal. The utility giant has delivered 46 consecutive dividend increases and has several more planned for the years ahead. 

The fact that demand for electricity doesn’t dip during recessions is a key reason why Fortis has maintained its dividend this year too. Meanwhile, its payout ratio is always conservative. The payout is 76% at the moment, which means there’s plenty of room for the company to boost its dividend or reinvest for growth in the years ahead. 

A $6,000 investment in Fortis within a few weeks could generate $228 in annual tax-free cash flow. That’s far better than what you’d expect from a “high-interest” savings account. 

Bottom line

The TFSA contribution room expands in a few weeks. Investors can add another $6,000 to their accounts to deploy into any asset class. I believe a growth stock like Docebo, dividend stock like Telus, or dividend growth stock like Fortis could all be great bets. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Fool contributor Vishesh Raisinghani has no position in any of the stocks mentioned. David Gardner owns shares of Amazon. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends FORTIS INC, TELUS CORPORATION, and Uber Technologies and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon.

More on Investing

Man data analyze
Tech Stocks

3 Reasons Celestica Stock Is a Screaming Buy Now

These three reasons make Celestica stock a screaming buy for long-term investors.

Read more »

profit rises over time
Dividend Stocks

These 2 Dow Stocks Are Set to Soar in 2025 and Beyond

Two Dow Jones stocks are screaming buys but Canadians must hold them in an RRSP or RRIF to avoid paying…

Read more »

TFSA (Tax free savings account) acronym on wooden cubes on the background of stacks of coins
Dividend Stocks

How to Use Your TFSA to Earn Ultimate Passive Income

If you have a TFSA, then you have the key to creating ultimate passive income. All you need is a…

Read more »

Confused person shrugging
Dividend Stocks

Better Buy: Fortis Stock or Hydro One Stock?

Let's do a compare and contrast of these two top utilities stocks right now, shall we?

Read more »

A close up color image of a small green plant sprouting out of a pile of Canadian dollar coins "loonies."
Dividend Stocks

Boost Your Passive Income: 2 Canadian High-Yielders at a Bargain

Nutrien (TSX:NTR) stock and another play that appear like fantastic dividend bargains in mid-November.

Read more »

Super sized rock trucks take a load of platinum rich rock into the crusher.
Metals and Mining Stocks

Invest $7,000 in This Dividend Stock for $672 in Passive Income

High yield can be an essential requirement when you need to start even a modestly sized passive income with a…

Read more »

telehealth stocks
Tech Stocks

Well Health Stock: Buy, Sell, or Hold?

Another record-breaking quarter and strong demand sets the stage for continued momentum for Well Health stock.

Read more »

3 colorful arrows racing straight up on a black background.
Dividend Stocks

TSX Stocks Soaring Higher With No Signs of Slowing

Three TSX stocks continue to beat the market and could soar higher in an improving investment landscape.

Read more »