For tax-free savings account (TFSA) investors looking for dependable income, the BMO Monthly Income ETF (TSX:ZMI) offers an appealing mix of yield, diversification, and stability. With a 4.7% yield, it far outpaces the S&P 500’s 1.2% average. Payments are made monthly, giving investors steady cash flow throughout the year. The fund’s expense ratio of 0.20% is modest, leaving more room for long-term returns.
ZMI isn’t a single-stock bet. Instead, it invests in other BMO exchange-traded funds with a focus on dividend payers, creating a built-in layer of diversification. Its holdings balance both equity and fixed income, making it less vulnerable to swings in any one part of the market. Financials make up about 26% of the portfolio, followed by technology at 17% and healthcare at 12%. With a strong tilt toward Canadian and U.S. markets, ZMI ensures broad exposure to North America’s most stable dividend sectors.
Performance has been steady this year, with the ETF up 6% so far, not including dividends. That combination of recurring income and price appreciation makes ZMI well-suited for investors who want both stability and upside. To put its yield into perspective, an investment of roughly $21,300 at current levels would generate about $1,000 in annual dividends.
For income-focused investors, ZMI checks several important boxes: a consistent monthly payout, balanced sector exposure, and strong long-term growth potential. With steady gains and one of the more generous yields on the TSX, it remains an attractive option for those seeking reliable cash flow inside of a TFSA.
