7 Best Monthly Dividend Stocks and ETFs For Passive Income

Best monthly dividend stocks 2025: If you’re looking to build reliable passive income, monthly dividend stocks and ETFs are a powerful tool. Unlike quarterly payouts, monthly dividends offer more frequent cash flow, which is perfect for reinvesting or covering recurring expenses.

What Are Dividend Stocks?

Dividend stocks are shares of companies that regularly distribute a portion of their profits to shareholders—usually in the form of cash payments called dividends. These companies are typically large, stable, and financially healthy, often found in sectors like utilities, consumer staples, and healthcare.

Example: If a company pays $1 per share annually and the stock trades at $25, its dividend yield is 4%.

Why Are Dividend Stocks Important?

Dividend-paying stocks are essential for building consistent income and long-term growth. Whether you’re a new investor or planning for retirement, dividend stocks offer a powerful mix of stability and compounding potential that makes them a core piece of any smart portfolio.

In this article, we’ll explore 7 of the best monthly dividend stocks and ETFs to consider in 2025 for growing your wealth and boosting income.

🏆 1. Realty Income (O)

Keyphrase: Realty Income monthly dividend
Known as “The Monthly Dividend Company,” Realty Income (ticker: O) is a favorite among income investors.

Sector: Real Estate (REIT)
Dividend Yield: ~5.5%
Why it’s great: Over 600 consecutive monthly dividends, strong tenants, and defensive properties.

📌 Tip: Perfect for long-term dividend reinvestment plans (DRIPs).

💰 2. STAG Industrial (STAG)

Keyphrase: STAG Industrial stock dividend
STAG focuses on single-tenant industrial properties — a booming niche due to e-commerce.

Sector: Industrial REIT
Dividend Yield: ~4.2%
Why it’s great: Stable tenant base, monthly payouts, and growth exposure.

💵 3. AGNC Investment Corp. (AGNC)

Keyphrase: AGNC dividend income
A high-yielding mortgage REIT, AGNC offers generous monthly dividends.

Sector: Mortgage REIT
Dividend Yield: ~13%
Why it’s great: One of the highest yielding monthly payers.

⚠️ Risk: Sensitive to interest rate changes — monitor performance closely.

🧱 4. Pembina Pipeline (PBA)

Keyphrase: Pembina monthly dividend
This Canadian energy company pays monthly dividends and has a strong dividend history.

Sector: Energy/Infrastructure
Dividend Yield: ~6.5%
Why it’s great: Strong cash flows from pipeline assets.

🌍 Note: Subject to Canadian dividend withholding tax if held in taxable accounts.

🧾 5. Global X SuperDividend ETF (SDIV)

Keyphrase: SDIV monthly dividend ETF
SDIV invests in high-dividend stocks globally and pays dividends monthly.

Sector: ETF
Dividend Yield: ~12%
Why it’s great: High yield with global exposure.

💡 Tip: Best for aggressive income seekers, not risk-averse investors.

📊 6. JPMorgan Equity Premium Income ETF (JEPI)

Keyphrase: JEPI monthly dividend ETF
JEPI is a covered call ETF that delivers high monthly income with reduced volatility.

Sector: ETF
Dividend Yield: ~8-9%
Why it’s great: Combines income and downside protection.

🧠 7. Invesco Preferred ETF (PGX)

Keyphrase: PGX monthly dividend
PGX provides exposure to preferred stocks, known for stable dividends.

Sector: Fixed Income/Preferreds
Dividend Yield: ~6.5%
Why it’s great: A solid source of monthly income with moderate risk.

Benefits of Dividend Stocks

✅ 1. Steady Passive Income

Keyphrase: dividend income
Dividend stocks create reliable, recurring cash flow. Investors are paid just for holding shares, which makes them ideal for income-focused investors or those planning for retirement.

📬 Think of it like earning rent on your stocks—without doing any work.

✅ 2. Compounding Through Reinvestment

Keyphrase: dividend reinvestment plan (DRIP)
Using a DRIP, you can automatically reinvest dividends to buy more shares—leading to faster portfolio growth through compound interest.

🔁 More shares → more dividends → even more shares. It snowballs over time.

✅ 3. Lower Volatility and Risk

Dividend-paying stocks tend to be more stable than non-dividend stocks. During market downturns, the steady income from dividends helps soften losses.

Even if the stock price drops, dividends provide a cushion of return.

✅ 4. Attractive Long-Term Returns

Historically, dividends have contributed a significant portion of total market returns. According to research, dividends and reinvestment can drive up to 40% of long-term equity returns.

A $10,000 investment in dividend stocks can grow to over $100,000 with reinvestment over time.

✅ 5. Tax Advantages

In many cases, dividends are taxed at lower rates than regular income, especially if they’re classified as qualified dividends. And in retirement accounts like a Roth IRA, they’re tax-free altogether.

✅ 6. Signals Financial Strength

Companies that consistently pay and raise dividends show strong balance sheets and disciplined management. It’s a signal of confidence and financial health.

Dividend Aristocrats—companies that have increased dividends for 25+ years—include names like Coca-Cola, PepsiCo, and Procter & Gamble.

✅ 7. Built-In Investment Discipline

Companies that pay dividends tend to be more careful with spending. They prioritize sustainable profitability and reward shareholders directly instead of taking on risky ventures.

🔐 Dividend stocks encourage long-term thinking—for both investors and companies.

How to Maximize Monthly Dividends

✅ Reinvest dividends automatically through DRIPs.
✅ Diversify across sectors to reduce risk.
✅ Focus on dividend sustainability, not just yield.
✅ Monitor payout ratios and interest rate impacts.

🚀 Final Thoughts

Dividend stocks offer the best of both worlds:

Steady income 💵
Long-term growth 📈

They’re perfect for investors looking to build passive income, reduce risk, and achieve financial independence through disciplined investing. Investing in monthly dividend stocks and ETFs can build a steady stream of passive income. Whether you’re looking for income now or compounding for the future, the 7 picks above provide excellent starting points.

About the Author

Max Fonji is the founder of The Rich Guy Math, a blog dedicated to simplifying investing and personal finance. With a passion for financial education, Max helps readers grow wealth through smart, stress-free strategies.