Generating consistent, passive income is a top priority for investors—whether you're approaching retirement, building wealth, or simply seeking financial freedom. While many assets appreciate over time, only a select few deliver real, ongoing cash flow without requiring you to sell shares or liquidate holdings.
This guide explores the seven highest-yielding investments in 2025, each offering strong returns, accessibility, and varying levels of risk and time commitment. From time-tested options like dividend stocks and bonds to emerging opportunities like private credit and CLO ETFs, we break down what makes each investment compelling—and how you can get started.
Summary of the Best High-Yield Investments
Below is an overview of the top income-generating assets for 2025:
- Private Credit: 9–18% yield | Short-term
- Bonds: 3–8% yield | Short-to-long-term
- Dividend Stocks & ETFs: 2–7% yield | Long-term
- Covered Call ETFs: 8–13% yield | Medium-to-long-term
- REITs: 3–15% yield | Long-term
- High-Yield Savings Accounts (HYSAs): 4–5% yield | Short-to-long-term
- CLO ETFs: 6–7% yield | Medium-to-long-term
Note: Average yields are based on current market data as of 2025. Actual returns may vary. This content is for informational purposes only and does not constitute financial advice.
Let’s dive into each investment option in detail.
1. Private Credit
Average Yield: 9–18%
Timeframe: Short
Accessibility: Accredited investors only
Private credit has emerged as one of the most attractive high-yield alternatives to traditional bank lending. When large private companies need funding but don’t qualify for conventional loans, they turn to non-bank lenders—often institutional giants like Goldman Sachs or AIG.
Now, individual investors can participate through platforms that democratize access to this asset class. One such platform, Percent, allows accredited investors to lend directly to private firms in exchange for high-interest returns.
As of April 2025:
- Average annualized yield: 13.71%
- Default rate: 2.64%
- Average term: 10.4 months
With over $1.45 billion invested and more than 89% of users reinvesting after their first deal, private credit is proving both profitable and reliable—for those who qualify.
👉 Discover how private credit can boost your portfolio returns with minimal volatility.
Who Qualifies as an Accredited Investor?
To invest in private credit offerings like Percent, you must meet at least one of these criteria:
- Annual income over $200,000 ($300,000 jointly)
- Net worth exceeding $1 million (excluding primary residence)
- Professional credentials in finance or investing
While not accessible to all, private credit offers compelling yields with relatively short durations and low correlation to public markets.
2. Bonds
Average Yield: 3–8%
Timeframe: Short-to-long
Accessibility: Open to all investors
Bonds remain a cornerstone of income-focused portfolios. When you buy a bond, you're essentially lending money to a government or corporation in exchange for regular interest payments (coupons) and the return of principal at maturity.
Two main types dominate the market:
- Government bonds (e.g., U.S. Treasuries): Lower yields but extremely safe
- Corporate bonds: Higher yields, especially "junk" or high-yield bonds from riskier issuers
Bond ETFs offer a smart way to gain diversified exposure with minimal capital:
- SGOV: Short-term Treasury ETF – 4.70% yield
- EDV: Long-term Treasury ETF – 4.95% yield
- VCIT: Investment-grade corporate bonds – 4.49% yield
- USHY: High-yield corporate bonds – 6.77% yield
These funds trade like stocks and require only a brokerage account to purchase.
3. Dividend Stocks & ETFs
Average Yield: 2–7%
Timeframe: Long-term
Accessibility: Open to all investors
Dividend-paying stocks combine income with growth potential. Unlike selling assets for cash, dividends provide recurring payouts while letting your principal grow—especially when reinvested.
A common mistake among beginners is chasing the highest yields. In reality, abnormally high dividend rates often signal underlying company troubles or a falling stock price.
Instead, focus on dividend growth stocks—companies with a track record of increasing payouts year after year due to rising profits.
Top examples include:
- Johnson & Johnson (JNJ): 3.38%
- Coca-Cola (KO): 2.85%
- ExxonMobil (XOM): 3.77%
- Altria Group (MO): 6.81%
- Verizon (VZ): 6.13%
For broader diversification, consider dividend-focused ETFs:
- SCHD: High-quality U.S. dividend growers
- VIG: S&P Dividend Aristocrats ETF
- DVY: High-yield dividend strategy
Reinvesting dividends creates compounding momentum—a powerful engine for long-term wealth.
4. Covered Call ETFs
Average Yield: 8–13%
Timeframe: Medium-to-long
Accessibility: Open to all investors
Covered call ETFs generate income by selling call options on stocks they already own. This strategy collects premiums from option buyers, which are distributed as monthly dividends.
While it caps upside gains (since shares may be sold if prices rise above the strike), it enhances yield and reduces volatility—ideal for flat or bearish markets.
Popular options:
- JEPI: 7.98% yield | Blue-chip stocks + ELNs
- QYLD: 13.85% yield | Nasdaq-100 covered calls
- XYLD: 13.37% yield | S&P 500 covered calls
These ETFs are excellent for investors seeking consistent income without managing options manually.
👉 Learn how covered call strategies can turn market stagnation into profit opportunities.
5. REITs (Real Estate Investment Trusts)
Average Yield: 3–15%
Timeframe: Long-term
Accessibility: Open to all investors
REITs allow you to earn rental income from real estate without buying property or managing tenants. Legally required to distribute at least 90% of taxable income as dividends, they’re ideal for income seekers.
Types include:
- Equity REITs: Own physical properties (apartments, malls, offices)
- Mortgage REITs: Invest in real estate debt
- Specialty REITs: Data centers, cell towers, storage units
Top performers:
- Realty Income (O): 5.66% yield | Monthly dividends
- Public Storage (PSA): 3.90% yield | Self-storage leader
- Digital Realty (DLR): 2.87% yield | Data center exposure
- AGNC Investment Corp (AGNC): 15.67% yield | High-risk mortgage REIT
For instant diversification, consider REIT ETFs like VNQ or SCHH.
6. High-Yield Savings Accounts (HYSAs)
Average Yield: 4–5%
Timeframe: Short-to-long
Accessibility: Open to all investors
HYSAs offer risk-free returns with FDIC insurance up to $250,000. With rates now significantly higher than traditional savings accounts, they’re perfect for emergency funds or short-term goals.
Many online banks offer competitive rates:
- Some platforms provide up to 5% APY
- Funds are highly liquid and accessible anytime
Though not a path to riches, HYSAs provide stable, inflation-beating returns with zero market risk—a smart place for idle cash.
7. CLO ETFs
Average Yield: 6–7%
Timeframe: Medium-to-long
Accessibility: Open to all investors
Collateralized Loan Obligations (CLOs) bundle loans made to below-investment-grade companies and divide them into tranches based on risk. CLO ETFs give retail investors access to the safest slices—typically AAA-rated tranches.
Benefits:
- Floating interest rates = perform well in rising rate environments
- Monthly or quarterly dividends
- Lower default risk than junk bonds
Top choices:
- CLOI: 6.34% yield | Diversified investment-grade exposure
- JAAA: 6.04% yield | Focuses exclusively on AAA tranches
CLO ETFs add diversification and resilience to income portfolios.
Frequently Asked Questions
Q: Which high-yield investment carries the least risk?
A: High-yield savings accounts (HYSAs) are the safest option—they’re FDIC-insured and offer stable returns with no market exposure.
Q: Can I invest in private credit without being accredited?
A: Currently, most private credit platforms like Percent require accredited investor status. However, some fund structures may offer indirect access in the future.
Q: Are covered call ETFs good during bull markets?
A: They tend to underperform in strong bull markets because upside gains are capped. However, they shine in sideways or volatile markets by generating steady income.
Q: How do REIT dividends differ from regular stock dividends?
A: REIT dividends are primarily a return of income (not profits), making them generally higher but often taxed at ordinary income rates unless held in tax-advantaged accounts.
Q: Why are CLO ETFs benefiting in 2025?
A: Their floating-rate structure allows them to adjust quickly to rising interest rates, protecting income streams and enhancing total returns.
Q: Should I prioritize yield over growth?
A: Balance is key. While high yield provides immediate income, long-term wealth comes from combining income with capital appreciation—especially in dividend growth stocks and REITs.
Final Thoughts
The best high-yield investments in 2025 blend reliability, accessibility, and strong returns. Whether you're building a retirement income stream or growing your wealth faster, there’s an option here for every investor type.
From secure HYSAs and dividend stalwarts to innovative private credit and structured products like CLOs and covered call ETFs, diversifying across these assets can help you maximize income while managing risk.
👉 Start building your high-yield portfolio today with tools that simplify smart investing decisions.
Remember: always align your investments with your risk tolerance, timeline, and financial goals—and consult a financial advisor when needed.