Successful passive income investing doesn’t have to be overly expensive or labor-intensive. With just $2,500 invested in a handful of stocks and exchange traded funds (ETFs), you can target an annual income goal of $3,500.
Not only that, but you can get cash in your account each and every month. The secret sauce is to combine high-paying dividend stocks with ETFs that offer juicy distribution yields.
Overall, the math should work out in your favor. If you invest $2,500 in five stocks/ETFs, that would be a $12,500 total investment. Then, to receive $3,500 per year in passive income, your average annual yield would need to be at least $3,500 / $12,500 or 28%. Let’s see how we can make this work with five high-yielding stocks/funds for your consideration.
Apple Hospitality REIT (APLE)
Apple Hospitality REIT (NYSE:APLE) is, as the company’s name implies, a real estate investment trust or REIT. Its focus is “hospitality” assets, which is a fancy way of saying that Apple Hospitality REIT invests in a portfolio of upscale hotels.
We’re not just talking about a few hotels here. All told, Apple Hospitality REIT’s portfolio includes “218 hotels with more than 29,500 guest rooms located in 84 markets throughout 37 states and the District of Columbia.”
Rest assured, I wouldn’t put any financial slackers on this list. My due diligence found that Apple Hospitality REIT is income-positive, having reported more than $50 million worth of net income in 2025’s third quarter.
Furthermore, Apple Hospitality REIT pays monthly cash dividends and provides a forward annual dividend yield of 8.3%. That falls short of the 28% average annual yield goal, but we’re only allocating $2,500 toward APLE stock shares out of a total $12,000 investment today.
Prospect Capital Corp. (PSEC)
Another monthly dividend payer is Prospect Capital Corp. (NASDAQ:PSEC). To sum up, Prospect Capital Corp. is a business development company or BDC that invests in a variety of U.S. middle market businesses.
This isn’t a brand-new start-up, by any means. In fact, Prospect Capital Corp. has a history of 21 years as a public company. It provides crucial loan capital to companies in the fields of healthcare, consumer finance, real estate, personal care products, and more.
Turning to financial matters, Prospect Capital Corp. recorded third-quarter 2025 net income totaling $12.822 million. Therefore, the company should be able to continue offering a hefty 19.85% forward annual dividend yield with a monthly payment schedule.
So far, our average annual yield is (8.3% + 19.85%) / 2, or approximately 14%. Consequently, we’ll need to delve into the realm of high-yielding ETFs to meet our objective of $3,500 per year in passive income.
A Trio of Power-Packed ETFs
To raise our average yield, we can get a big boost by allocating $2,500 toward three YieldMax funds. These ETFs pay out cash distributions every week, so you’ll still be on track to collect passive income at least once per month.
YieldMax’s single-stock ETFs tend to follow similar strategies involving writing covered call options on stocks or synthetic positions. You should certainly look at the annual distribution yields, but it’s equally important to focus on funds based on reputable stocks.
For example, the YieldMax NVDA Option Income Strategy ETF (NYSEARCA:NVDY) is based on NVIDIA (NASDAQ:NVDA) stock, which is quite reputable. After all, NVIDIA is the undisputed U.S. heavyweight champion of artificial intelligence (AI) graphics processing units (GPUs).
To summarize how it works, the YieldMax NVDA Option Income Strategy ETF uses options-trading strategies to indirectly extract income from NVIDIA stock. Sure, it’s somewhat risky, but the NVDY ETF currently features a 46.93% annual distribution rate.
Next up, we have the YieldMax BRK.B Option Income Strategy ETF (NYSEARCA:BRKC), which uses options to indirectly generate weekly income from Berkshire Hathaway (NYSE:BRK-B) stock. Led by soon-to-retire CEO Warren Buffett, Berkshire Hathaway is a highly diversified and successful holding company.
Whereas Berkshire Hathaway stock doesn’t pay any dividends/distributions at all, the YieldMax BRK.B Option Income Strategy ETF serves up a massive 45.7% distribution rate. Sure, BRKC shares are riskier than simply holding BRK-B stock, but higher risk could translate to greater rewards.
Finally, we’ll plow our last $2,500 investment into the YieldMax GOOGL Option Income Strategy ETF (NYSEARCA:GOOY). As you probably surmised, this YieldMax fund indirectly derives options-based weekly income from Alphabet (NASDAQ:GOOGL) stock.
Surely, I don’t need to remind you that Alphabet’s Google is the king of U.S. search engines. In any case, the YieldMax GOOGL Option Income Strategy ETF advertises a delectable 33.36% expected annual distribution rate.
At long last, we have five assets with an average dividend/distribution yield of 30.83%, which beats our 28% objective. Hence, if you purchase $2,500 worth of each asset and leave it for a year — and if the distribution rates don’t decrease — then you ought to receive $3,500 in monthly (and, to a certain extent, weekly) passive income.