10 Stocks For Passive Income Investment

It’s great that you have a regular income from your 9-to-5 job. But deep down, you realize that you’ve always craved more. The more money you have, the better. Investing in stocks for passive income is one way to get that early retirement and luxurious lifestyle you crave for.

Investing in stocks (especially dividend-paying ones) might help you generate more money with less effort.

One of the advantages is that anyone, including students and school dropouts, can do it.

To obtain passive income, you can either invest in certain financial products or build enterprises that generate revenue after an initial investment. Depending on where the money comes from, you may be taxed differently on passive income, so keep track of your profits.

To help you make the right choice, we have compiled a list of the top stocks for passive income to help you realize your retirement goals and enjoy a comfortable lifestyle.

Please keep reading to learn about stock investment ideas and how to buy them from the article.

Before we get started, let’s look at some queries you might want to be answered.

What Is Passive Income?

Money from investments, properties, or side jobs is called passive income. The goal is to get a steady flow of money without working every day.

The objective is to generate a regular income stream without working a full-time job every day.

In contrast to active income, such as a paycheck from a job or a contract, passive income takes little or no effort to earn profits.

Why Are Stocks Necessary for Passive Income Investment?

In 2022 or 2023, the Federal Reserve may finally begin raising interest rates. Investors who need extra cash will be pleased to hear this news. 

However, in recent years, bonds and bank savings accounts have shown to be insufficient for generating interest. As a result, investing in stocks that provide passive income is an excellent alternative.

These and many more are some of the reasons why buying stocks for passive income is good.

What You Should Know Before Buying Stocks For Passive Income

It’s crucial to note that dividend growth is the source of passive income stock profits. In the future, if you buy an investment that yields 6% today, it will still yield 6% if the company never raises its dividend. In the meantime, as inflation takes its toll, your real income will erode over time.

Although today’s stock is giving just 2 percent, it will yield about 10 percent on your investment in 2030. Unsurprisingly, a firm that can rapidly increase its dividend also tends to have a high share price performance.

Read Also: Best Income Producing Assets You Should go for 

You should focus on how quickly your passive revenue stream grows rather than how big it is initially.

As a result, the emphasis on this list is on companies whose dividend income can be rapidly increased over time.

10 Best Stocks For Passive Income 

This article will look at the 10 best passive income stocks to buy now. 

  1. Stocks For Passive Income: 3M
  • Forward Dividend & Yield: 5.96 (4.63%)
  • Ex-Dividend Date: May 19, 2022
  • 5-Year Dividend Growth Rate: 6.40% 

The first on our list of best stocks for passive income is 3M.

3M is an industrial mainstay and member of the elite club of dividend-paying stocks known as the Dividend Kings. The stock is excellent for novice investors looking to buy stocks for passive income.

When you invest in this stock, your investment gets a forward yield of 4.6 percent, which is a nice bonus. There is no guarantee that the company’s history of dividend increases will continue.

Still, it gives investors some hope that 3M can successfully navigate the uncertain macroeconomic crisis.

Find out: What Is Net Investment Income Tax? Overview And How It works 

To begin with, it has a proven track record in the marketplace as a primary provider of products and services across numerous industries. A payout ratio of 54 percent over the past decade indicates that 3M’s management isn’t ready to put the company’s financial viability at risk to please shareholders. 3M is among the best dividend stocks for passive income.

  1. Brookfield Renewable Corporation
  • Forward Dividend & Yield: 1.28 (3.59%)
  • Ex-Dividend Date: May 31, 2022
  • 5-Year Dividend Growth Rate: 0.20% 

Next on our list of stocks for passive income is Brookfield Renewable Corporation Stock.

Brookfield Renewable is a wise addition to a new basket of dividend stocks because it has gone from being a giant in the industrial industry to one in renewable energy. Solar and wind power (among others) are enjoying a renaissance, and this trend is expected to continue.

The International Energy Association, for example, predicts a 60% increase in worldwide renewable energy capacity between 2020 and 2026.

Related: Real Estate vs Stocks: Which Is A Better Investment 

Customers buy power from Brookfield Renewable’s worldwide renewable energy portfolio on long-term contracts, which ensures a steady revenue flow.

The company has 21 GW of operational capacity and 69 GW of projects in the pipeline, with a current portfolio of 21 GW.

If you’re an investor concerned about how the company plans to increase its forward yield of 3.5% in the coming years, this information should help.

Investment-grade balance sheet data also shows that the company is in good financial condition, which gives investors more confidence that the company will continue to pay dividends.

It’s a good investment for novice and veteran investors looking to purchase dividend stocks for passive income.

  1. Stocks For Passive Income: Hormel Foods (HRL)
  • Forward Dividend & Yield 1.04 (2.19%)
  • Ex-Dividend Date Jul 08, 2022
  • 5-Year Dividend Growth Rate: 12.2 %

Hormel Foods exemplify consistent dividend increases. HRL has discreetly churned out annual earnings growth of around 10%, which has translated into significant dividend increases over time.

With annual dividend increases of 12 percent, the passive income from HRL stock rises rapidly, despite the company rarely yielding more than 2 percent when purchased.

Those who purchased the stock in 2011 are now reaping about 7.1% yearly in dividends. Considering this is a low-risk firm, that’s quite an accomplishment. HRL stocks are listed among the best stocks for passive income. 

Don’t Fail to Read This Article: What Is Annual Income? Definition And How To Calculate Your Income 

Foods made by Hormel are not only recession-proof, but the company also boasts one of the most robust balance sheets in its industry. It can take a more aggressive stance in a downturn in the economy and develop its business.

  1. Stocks For Passive Income: Realty Income Stock.
  • Forward Dividend & Yield: 2.97 (4.31%)
  • Ex-Dividend Date: Jun 30, 2022
  • 5-Year Dividend Growth Rate: 3.40%

Next on our list of best stocks for passive income is Realty Income.

Although Realty Income’s track record of returning cash to shareholders isn’t as long as 3M’s, the company has a solid record.

For the past 27 years, Realty Income has been a member of the club known as Dividend Aristocrats, companies that have consistently increased their dividends. It calls itself “The Monthly Dividend Company.”

Long-term investors will be able to compound their returns even faster with Realty Income than other equities that pay quarterly dividends. Realty Income has increased its dividend 115 times since its public debut in 1994, adding to its compound annual dividend growth rate of 4.4%.

Related: How To Buy Stocks Without A Broker In 2022 | Expert Guide 

Realty Income is a real estate investment trust, which means it must distribute at least 90% of its taxable income to shareholders in the form of dividends.

  1. Stocks For Passive Income: Mastercard (MA)
  • Forward Dividend & Yield: 1.96 (0.61%)
  • Ex-Dividend Date: Jul 07, 2022
  • 5-Year Dividend Growth Rate: 19.1%

Next on our list of stocks for passive income is Master Card Stock.

If you look at Mastercard’s current dividend yield of 0.5 percent, you will think this is an insane decision. However, this is an excellent example of how passive revenue streams can expand over time.

A little 0.2 percent annual dividend was paid out by MA stock in 2011. A $10,000 investment in MA stock would have yielded $20 annual dividends. I’d say it’s not the best.

Related: 15 Best Passive Income Ideas to Make Money While Sleeping in 2022

However, the identical investment now generates $640 in dividends annually. For example, Mastercard’s dividend has increased 30 times in the last decade. The fact that the stock price rose by several hundred percent didn’t hurt either.

Mastercard is a part of the credit card oligopoly, which means it has fewer competitors and higher profit margins.

As the assault on cash intensifies, more and more businesses are switching to card payment methods. In addition, the management of Mastercard is committed to distributing profits to stockholders.

  1. Stocks For Passive Income: The J.P. Morgan Chase & Co. (JPM)
  • Forward Dividend & Yield: 4.00 (3.50%)
  • Ex-Dividend Date: Jul 05, 2022
  •  5-Year Dividend Growth Rate15.4%.

Securing a steady income from bank stocks may sound absurd to those newer to investing. As a result of the Great Financial Crisis, several venerable institutions were wiped out, and the survivors lowered many dividends.

In contrast, from the 1940s through 2008, the banking sector was one of the most trustworthy and reliable sources of income.

Moreover, they are re-establishing themselves as significant dividend-growth tales. We have included JP Morgan Chase Bank in our list of best dividend stocks for passive income.

Related Article: 20 Best Passive Income Browser Extension In 2022 

When it comes to a blue-chip stock, J.P. Morgan is an example. The bank’s initial dividend yield is a very respectable 2.4%, and it has been steadily raising it.

Capital return policies in 2020 will be severely restricted because of the Federal Reserve’s tightening response to the epidemic.

Strong banks like J.P. Morgan are expected to be able to increase their dividends this year because of the expected easing of these regulations.

  1. Stocks For Passive Income Starbucks (SBUX)
  • Forward Dividend & Yield: 1.96 (2.47%)
  • Ex-Dividend Date; Aug 11, 2022
  • Growth in Dividends over 5 Years: 18.2%

Starbucks is exactly what you want in a dividend-paying stock. It’s a well-known product name all across the world.

When Starbucks boosts its prices, few customers seem to notice or care. Moreover, the company’s products—coffee and sugary beverages—are universally popular.

Related: Investing $200k For Income in 2022: 10 Best Options to Wealth 

As a result, Starbucks is well-positioned to continue expanding its market share. Starbucks had a setback a decade ago when it grew too quickly in the United States, but it has refocused.

Starbucks stockholders can expect their dividends to rise for the next decade thanks to the company’s expansion plans in emerging countries like China and Latin America.

Starbucks is one of the best dividend stocks for passive income due to its availability. This passive income stock can be purchased with little effort compared to others.

  1. Stocks For Passive Income: Northern Trust (NTRS) 
  • Forward Dividend & Yield: 2.80 (2.90%)
  • Ex-Dividend Date: Jun 09, 2022
  • 5-Year Dividend Growth Rate: 14.2 percent

Another bank that has done an excellent job of keeping up with the times is Northern Trust. Northern Trust is a financial institution specializing in asset management.

This form of bank charges a small fee for holding cash and securities on behalf of entities such as pensions, governments, and asset managers.

As a rule, custody banks are less risky than typical “too big to fail” institutions. As expected, Northern Trust was unaffected by the financial crisis of 2008 and has risen to new all-time highs.

With a dividend growth rate of 14% per year over the past five years, Northern Trust was already on the rise before Covid-19. A rise in interest rates will benefit NTRS stock when the Federal Reserve begins a new rate-hiking cycle.

  1. Stocks For Passive Income: Charles Schwab (SCHW)
  • Forward Dividend & Yield: 0.80 (1.24%)
  • Ex-Dividend Date: May 12, 2022
  • Dividend Growth Rate over Five Years: 23.6%

Over the previous five years, Charles Schwab’s dividend has increased by more than 23% per year. Despite its modest dividend yield, the discount brokerage is increasing its income investing.

On top of that, business for the organization appears to be better than it has ever been. When most people were at home, a new wave of investors became interested in the stock market. As a result, brokerages like Charles Schwab saw a significant increase in business.

Related: Do you Have to Pay Taxes on Stocks? All You Need to Know

As a result, borrowing rates have skyrocketed recently. The Federal Reserve expects to raise interest rates several times in the coming years. Schwab must be overjoyed. As a result, it generates a significant portion of its revenue through interest on customer deposits. Charles Schwab’s profits are expected to climb as interest rates rise. For this reason, dividends are likely to rise further in the future.

  1. Stocks for Passive Income: Coca-Cola 
  • Forward Dividend & Yield: 1.00 (0.17%)
  • Ex-Dividend Date: Apr 27, 2022
  • 5-Year Dividend Growth Rate: 3.60%

As a worldwide beverage firm, Coca-Cola (NYSE: ko) operates through an international network of bottling partners, distributors, wholesalers, and retailers to market a wide range of alcoholic and non-alcoholic beverages.

The coca-cola business (NYSE: ko) announced on February 17 a quarterly dividend of $0.44 per share, an increase of 4.8 percent over the previous payout of $0.42. March 15 shares will receive their dividend on April 1st. Coke (NYSE: ko) has a dividend yield of 2.84 percent as of February 18.

61 hedge funds have a combined interest of more than $25 billion in the Coca-Cola Company (NYSE:ko). There are 400 million Coca-Cola company shares owned by Warren Buffett’s Berkshire Hathaway, which is worth about $21 billion. Coca-Cola stock is one of the dividend stocks for passive income.


Investing in dividend stocks allows you to earn money while doing nothing. To help you build an extra stream of passive income, we have compiled this list of the best stocks for passive income just for you.

Do further research on the stock you want to invest in. if you are still new to investing, we advise you to go for passive income stocks with low forward dividends and high percentage increases over time.

Frequently Asked Questions (s)

1. How can I get a steady income from my stock investments?

Investing in dividend stocks is one of the most straightforward ways to generate passive income.

2 Is investing in stocks a decent strategy to generate passive income?

Yes, they are a good source of passive income. A more excellent dividend payment results from owning more shares of a company.

3. What is the most lucrative form of passive income out there?

In terms of passive income, dropshipping is one of the best. Dropshipping allows you to identify hot products on marketplaces like AliExpress and sell them to buyers all around the world.

Reference (s)

www.money.usnews.com.-7 Best Cheap Dividend Stocks Under $10

www.nerdwallet.com-25 High-Dividend Stocks and How to Invest in Them

www.theglobeandmail.com-5 Beginner Stocks to Generate Passive Income

www.investorplace.com-10 Best Stocks to Buy to Build Up Passive Income Streams


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