Investors seeking long-term income growth are increasingly turning to high-yield dividend stocks as a cornerstone strategy for building wealth. With the right mix of companies, you can create a portfolio that not only delivers robust returns today but also grows into a 12%+ yield on cost by 2035. In this guide, we’ll explore May 2025’s top 10 high-yield picks and how they can help you achieve a reliable stream of passive income over the next decade.
Why Focus on Yield on Cost?
Yield on cost is a key metric for dividend investors. It measures your future dividend income based on the original amount you invested. For long-term investors, this figure matters more than the current yield because it reflects how much your income has grown over time.
Building a portfolio with strong dividend growth potential today can lead to a significantly higher yield on cost by 2035—especially when you're investing in companies with solid fundamentals and a track record of dividend payments.
May 2025’s Top 10 High-Yield Dividend Picks
The following top dividend stocks for 2025 were selected based on their valuation, financial strength, and long-term growth potential. An equally weighted portfolio of these stocks provides a current average dividend yield of 6.01%, with the potential to exceed 12.4% yield on cost by 2035.
✅ 1. VICI Properties (VICI)
A leading REIT focused on casino and entertainment real estate with consistent dividend growth and recession-resistant assets.
✅ 2. Chevron Corporation (CVX)
One of the top energy stocks offering both stability and strong dividend payouts. A strong pick for passive income investing.
✅ 3. Canadian Natural Resources (CNQ)
With global energy demand increasing, CNQ provides excellent dividend yield optimization through energy sector exposure.
✅ 4. Pfizer (PFE)
A healthcare dividend giant known for its global pharmaceutical presence and consistent payouts.
✅ 5. Altria Group (MO)
A classic high-yield dividend stock, offering robust cash flows and a commitment to returning capital to shareholders.
✅ 6. CVS Health (CVS)
This healthcare and retail hybrid is a compelling dividend pick with strong fundamentals and growth potential.
✅ 7. Toronto-Dominion Bank (TD)
A leading Canadian bank with strong international operations, offering attractive dividends and diversification.
✅ 8. Comcast (CMCSA)
A communications powerhouse with growing content assets and a solid history of dividend increases.
✅ 9. Vale S.A. (VALE)
A top mining company with high dividends, especially appealing in commodities upcycles.
✅ 10. Ares Capital (ARCC)
A standout in the BDC space, known for delivering consistently high dividends to investors.
Diversification and Strategy
This dividend income portfolio is not only designed for yield but also for diversification across industries and geographies. Spreading investments across energy, healthcare, finance, real estate, and communications helps protect against sector-specific downturns while maintaining income stability.
How to Reach a 12%+ Yield on Cost by 2035
Reaching a 12%+ yield on cost isn’t about chasing today’s highest yields—it’s about picking stocks with sustainable dividends and long-term growth. Here’s how:
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Reinvest dividends to compound returns
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Hold for the long term to benefit from dividend increases
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Maintain a diversified mix of sectors and geographies
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Avoid dividend traps with poor fundamentals
Final Thoughts
By starting with these top dividend stocks for 2025, investors can build a resilient portfolio targeting a high yield on cost over the next decade. Whether you're planning for retirement, financial independence, or a stronger income stream, this approach to dividend growth investing provides a proven, steady path forward.
Now is the time to act—build your long-term dividend strategy with confidence, and watch your income grow through 2035 and beyond.