Do you have $5,000? Here’s how to make almost $500 in extra income in 2025.

Many companies return a portion of their profits to investors in the form of dividends. This allows their shareholders to earn additional income every year.

Some companies Really pay their investors well. For example, AGNC investment (AGNC 0.21%), Energy transfer (ET 2.27%)And Medical Properties Trust (MPW 1.39%) currently on offer Dividend yields of 6.7% or higher. That’s significantly more than the average dividend stock (the S&P 500‘S The dividend yield is currently around 1.2%. This is why an investor can turn a $5,000 investment into almost $500 in additional income next year:

Data source: Google Finance. Table by author.

For comparison, the same $5,000 invested in a S&P 500 index funds would only generate about $60 in income in 2025 at the current rate. Here’s a closer look at these income-producing stocks.

AGNC investment

AGNC Investment is a real estate investment fund (RIDING). It invests in agency mortgage-backed securities (MBS), Pools of Mortgages that are protected by government agencies against loan default Fannie Mae or Freddie Mac. This makes them very low risk fixed-interest investments.

MBS also have relatively low yields (low to mid-single digits). AGNC Investments can increase its investment returns by using leverage (borrowing money) to purchase additional MBS. It makes money on the spread between borrowing and MBS investments. This strategy can be very lucrative. AGNC Investment currently earns a Return on equity in their mid to high teens.

The Mortgage REIT has paid its current dividend rate for 55 consecutive months. It expects to be able to maintain this level going forward as market conditions improve as the Federal Reserve lowers interest rates. While a sudden and unexpected deterioration in market conditions could negatively impact this REIT (it has had to cut its dividend in the past), it looks like a solid bet to generate strong returns in the coming year.

Energy transfer

Energy transfer is a Master Limited Partnership (MLP), Companies that provide their investors with a Schedule federal tax form K-1 every year. The Company owns a diversified portfolio of midstream energy assets, including pipelines, processing facilities and export facilities. These companies generate relatively stable cash flow, which is secured by long-term fixed interest contracts or government-regulated tariff structures.

The MLP distributes a little more than half of its free cash flow to investors. It keeps the rest to finance expansion projects and maintain its financial flexibility. The company has used this flexibility to make several accretive acquisitions in recent years, including its merger with fellow MLP Crestwood Equity Partners last year and its recent deal to purchase WTG Midstream.

The company’s growth-oriented investments are intended to increase its cash flow. This should enable energy transfer to continually increase its distribution. The aim is to increase the distribution by around 3 to 5% annually. Because of this, it is likely to provide investors with an increasing source of income in 2025 and beyond.

Medical Properties Trust

Medical Properties Trust is a REIT focused on owning hospitals. It rents these properties to healthcare companies that operate the facilities.

The healthcare REIT has had some tenant issues in recent years that have impacted its rental income. This forced the company to sell some other properties for financial security. Meanwhile, the company recently agreed to replace its largest tenant with five new, financially stronger operators. In addition, another large, financially struggling tenant is likely to do better next year. Because of these changes, the REIT will have a much healthier portfolio and financial profile go forward.

Medical Properties Trust expects its rental income to increase steadily over the next two years as its new tenants increase their operations and rental payments. That means it could can increase its dividend in 2025 after cutting its payout twice in recent years to conserve cash.

High income producers

AGNC Investment, Energy Transfer and Medical Properties Trust at the moment pay profitable Dividends. As a result, they can help an investor earn much more income for every dollar they invest. This trio is on track to generate lucrative income streams in 2025, with potential for income growth from Energy Transfer and Medical Properties Trust.