Getting rich through dividend investing can be a sensible goal as long as you have patience and don’t take on too much risk. One way to quickly build up your portfolio without the need for stock picking is to buy exchange traded funds (ETFs) that cover a variety of dividend-paying stocks.
If you can just find a handful of powerhouse dividend ETFs, you could potentially look forward to a lifetime of steady passive income. Today, I’m in your corner with four super-high-yield funds so you can start building up your wealth in 2025.
QDVO for Safe Income
Instead of chasing the highest-yielding stocks and funds, it’s smarter to focus on safe, steady income. An easy way to de-risk your portfolio while still achieving high yield is to simply buy the Amplify CWP Growth & Income ETF (NYSEARCA:QDVO).
Using dividend-collecting and option-writing strategies, the Amplify CWP Growth & Income ETF provides exposure to 51 high-quality stocks. We’re talking about famous names like Visa (NYSE:V | V Price Prediction), Procter & Gamble (NYSE:PG), Home Depot (NYSE:HD), Apple (NASDAQ:AAPL), Costco Wholesale (NASDAQ:COST), and Coca-Cola (NYSE:KO).
Impressively, the Amplify CWP Growth & Income ETF offers a distribution rate (which is similar to a forward annual dividend yield) of 9.87%. Unless you’re adept at trading options, you probably wouldn’t get anything close to that yield if you bought all of those stocks individually.
Not only that, but the QDVO ETF pays out its distributions on a monthly basis. This means you won’t have to wait three months to start collecting the cash distributions.
Now, I need to mention an important point. Since the fund’s managers do all of the stock picking for you, the Amplify CWP Growth & Income ETF deducts operating expenses from the share price. More specifically, the QDVO ETF subtracts 0.55% worth of operating fees per year.
Therefore, the post-fees annual yield you can expect from the Amplify CWP Growth & Income ETF is 9.87% – 0.55%, or 9.32%. That’s still a hefty yield from a fund that can de-risk your portfolio by investing in well-known large-cap companies.
SPYI for Big Yield
Next up is the NEOS S&P 500 High Income ETF (BATS:SPYI), generates monthly cash distributions from constituents of the prestigious S&P 500 stock index. Because you’ll get portfolio exposure to roughly 500 large-cap stocks, the risk factor isn’t high with this fund.
It’s easy to sleep soundly at night when the SPYI ETF includes industry leaders like McDonald’s (NYSE:MCD), JPMorgan Chase (NYSE:JPM), Microsoft (NASDAQ:MSFT), and Walt Disney (NYSE:DIS). In other words, the NEOS S&P 500 High Income ETF generates steady monthly payouts from established blue-chip stocks just like the QDVO ETF does.
Getting down to the nitty-gritty, the NEOS S&P 500 High Income ETF advertises a massive 12.15% annual distribution rate. Remember, though, that we need to subtract the operating fees.
The SPYI ETF’s annual operating fees are 0.68% of the share price. Hence, investors should anticipate a net yield of 12.15% – 0.68%, or 11.47%. You must admit, the NEOS S&P 500 High Income ETF is a tempting fund for today’s passive income investors.
RSPA for Extra Diversification
For even wider diversification without too much exposure to any individual stock, check out the Invesco S&P 500 Equal Weight Income Advantage ETF (NYSEARCA:RSPA). With 525 stocks in its holdings, the RSPA ETF unlocks income generating opportunities across multiple market sectors.
Like the SPYI ETF, the Invesco S&P 500 Equal Weight Income Advantage ETF mainly concentrates on stocks in the S&P 500 index. The RSPA ETF is different, however, since it assigns a very small and nearly equal portfolio weight to each stock in its holdings.
Just to provide a few examples, the Invesco S&P 500 Equal Weight Income Advantage ETF takes tiny positions in heavy hitters like BlackRock (NYSE:BLK), Johnson & Johnson (NYSE:JNJ), Consolidated Edison (NYSE:ED), and Boeing (NYSE:BA). This is a truly unique fund that mitigates risk while putting substantial cash payments in your account every quarter.
Turning now to the yield and fees, the SPYI ETF features a 12-month distribution rate of 9.43% and very reasonable annual operating fees of 0.29%. Thus, the Invesco S&P 500 Equal Weight Income Advantage ETF’s expected net yield would be 9.43% – 0.29%, or 9.14%, so this is definitely a high-yield fund to consider.
QQQI for Tech Exposure
Finally, if you don’t mind a little more risk, you can try the NEOS NASDAQ-100 High Income ETF (NASDAQ:QQQI). This fund is heavily weighted toward the technology sector, but it still provides decent diversification.
The NEOS NASDAQ-100 High Income ETF is based on the NASDAQ 100 and includes approximately 100 stocks that are mainly in the technology field. In the fund’s holdings, you’ll surely recognize tech titans like NVIDIA (NASDAQ:NVDA), Meta Platforms (NASDAQ:META), Amazon (NASDAQ:AMZN), and Broadcom (NASDAQ:AVGO).
If you’re seeking enhanced portfolio participation in Big Tech stocks, the NEOS NASDAQ-100 High Income ETF makes it easy and convenient. Plus, you’ll get a cash distribution each and every month with the QQQI ETF.
For a small amount of added risk, the potential rewards could be outstanding with the NEOS NASDAQ-100 High Income ETF. Believe it or not, the QQQI ETF currently advertises a 14.65% distribution rate.
There are 0.68% worth of annualized operating fees association with the NEOS NASDAQ-100 High Income ETF, but that shouldn’t be a deal breaker. When all is said and done, you can expect an annual yield of 14.65% – 0.68%, or 13.97%. With that in mind, the QQQI ETF looks like a worthy addition to your steady high-yield fund collection.
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