Passive income in the US has a dirty little secret: most people barely see any of it. Headlines love seven-figure landlord stories and TikTok gurus counting cash on a beach.

Here is what the data shows. Among households that bring in any passive income, the median number is near 4,200 dollars a year. Plenty of families sit well below that, and most get nothing at all. That is the main reason why you should never blindly follow the hype.

So, which passive income streams actually pay the most in America right now? You can find out in the sections below.

Rental Real Estate (Long Term Rentals, Short Term Rentals, House Hacking)

Rental property sits on top of the passive income pile in the US for a simple reason: one asset can throw off meaningful cash without needing a giant stock portfolio.

How Much Rental Income Pays In 2025?

National rent growth runs around 2 to 3 percent year over year, with single-family rents closer to 3 percent.

Gross rental yields in many cities range around 3 to 6 percent, while net cash yields often fall closer to 2.5 to 4.5 percent after taxes, insurance, repairs, vacancies, and management.

• A 300,000 dollar rental at 5 percent gross yield brings about 15,000 dollars per year before costs.
• After normal expenses, net cash flow often lands around 7,500 to 13,500 dollars per year.

One solid property can beat the median passive income number by a wide margin.

What About Long-Term Rentals?

Long-term leases remain the steadiest path.

Income shows up monthly, turnover stays manageable, and demand holds up while many buyers stay priced out.

• Concessions are more common in oversupplied metros, so owners who overpaid feel pressure.
• Single-family rentals stay resilient with strong occupancy in many Sun Belt and Midwest areas.

Short-term Term Rentals are Known for Higher Ceilings, but Also For Sharper Drops

Renting your property for a short term can bring even more profit, but the problem is that it can be difficult to have it rented all the time.

It depends on the area where you have property. If the location is a popular spot for tourists during the whole year, then short-term renting with services like AirBnb and Booking can be the most profitable solution.

House Hacking is the Fastest Route To First Cash Flow

House hacking means buying a primary home and renting part of it.

The edge comes from owner-occupied financing with lower down payments and better rates, plus rent that can cover most of the mortgage.

Property Backed Private Lending (Hard Money, Bridge Loans)

Private lending tied to property offers a landlord-style payout without tenant headaches.

You fund a deal, collect interest, and rely on the property as collateral.

• Hard money loans often price around 9.5 to 15 percent interest, plus 1 to 3 points upfront.
• Bridge loans trend near 10 to 11 percent, while DSCR rental loans run lower.

Upside comes from high rates. Risk comes from borrower default or a collateral value drop.

REITs Offer Real Estate Income Without Owning Property

A REIT is a public company that owns property like apartments, warehouses, malls, or data centers, and by law pays most taxable income out to shareholders.

That setup makes REIT payouts look more like rent checks than stock buybacks.

In 2025, broad US equity REIT yields sit around the mid single digits, often near 4 percent, though exact payouts swing by sector.

Apartment and industrial REITs usually carry lower yields with stronger growth potential, while office or retail REITs may offer higher yields to compensate for heavier risk.

Main Benefits

• Easy entry point, buy and sell like any stock.
• Diversification through one ticker instead of one address.
• No tenant calls, repairs, or property tax surprises.

But There are Risks

• REIT prices move with the stock market, so value can drop even if rents inside the portfolio hold steady
• Higher interest rates tend to pressure REIT prices because investors can get a safer yield elsewhere
• Sector choice matters a lot, since the performance of data centers differs from the performance of offices

Dividend Stocks

Dividend stocks are the classic Wall Street version of passive income: buy shares in companies that pay regular cash, collect the checks, and let time do the heavy lifting.

What Dividend Stocks Pay In 2025?

Broad market dividends are modest right now.

The S&P 500 dividend yield sits near 1.2 percent in November 2025, well below long-term averages.

Higher income comes from choosing stocks or funds built for yield.

Many established dividend payers sit in the 2 to 4 percent range, while some higher-yield sectors push beyond that, with the tradeoff of slower growth or higher risk.

Dividend Growth Beats Chasing Only Yield

A fat yield can be a trap if the business is shaky. The safer long game usually looks like dividend growth: companies that raise payouts year after year.

The Dividend Aristocrats list in 2025 has 69 S&P 500 firms with 25+ straight years of dividend increases, and the group has a record of holding up better in rough markets while compounding income over time.

How Dividend Income Stacks Up Versus Other Streams

Dividend stocks rarely beat rental property in raw dollars unless the portfolio is big.

Using simple math:

• 200,000 dollars in a 3 percent dividend setup pays about 6,000 dollars per year.

Dividend investing works best as a scalable “money makes money” channel. Put more in, get more out, without tenants or toilets.

Crypto Investing As A Popular Alternative

A growing slice of investors now treats crypto as a parallel passive-income lane.

There are two main angles:

• Price exposure through holding major coins like Bitcoin or Ethereum.
• Yield exposure through staking on proof-of-stake networks.

Staking yields vary a lot by network and platform.

Big proof-of-stake chains like Ethereum tend to pay lower but steadier rewards, while smaller chains often advertise higher rates that come with bigger volatility and token inflation risk.

Some major coins, like Bitcoin and XRP, do not have native staking, so any yield tied to them usually comes from platform-run lending or earn programs.

US rules around staking are clearer than a couple of years ago, but risks stay on the table: platform failure, lockup periods, and the simple fact that coin prices can drop faster than staking rewards can make up.

Dividend Focused ETFs

Rather than hunting for individual payers, one fund buys a basket of them, rebalances on rules, and sends payouts to shareholders on schedule. That’s the whole point of investing in ETFs.

Yields look better than the broad market.

The S&P 500 sits near a 1.2 percent dividend yield in late 2025, close to multi-decade lows, mainly because mega-cap growth stocks pay little.

Dividend ETFs aim straight at that gap.

What Dividend ETFs Pay In 2025?

Popular US dividend ETFs cluster into two lanes: yield first and growth first.

Yield First Funds Pay More Cash Now

• Schwab US Dividend Equity ETF (SCHD) yields about 3.9 percent in November 2025.
• Vanguard High Dividend Yield ETF (VYM) yields about 2.5 percent in late November 2025.

Growth First Funds Pay Less Today but Push for Rising Payouts

• Vanguard Dividend Appreciation ETF (VIG) yields about 1.6 to 1.7 percent.
• iShares Core Dividend Growth ETF (DGRO) yields about 2.0 percent.

Example: A $200,000 position in SCHD at roughly 3.9 percent yield throws off about 7,800 dollars a year before taxes. Same amount in VIG at about 1.6 percent lands near 3,200 dollars, with more weight on future growth.

Why ETFs Beat Picking Individual Dividend Stocks For Most People

ETFs solve three problems that trip up DIY dividend investors.

1. Single company blowups get diluted. One cut does not nuke the whole income stream.
2. Rules keep emotions out. Funds rebalance by screens like dividend growth history, payout ratios, or quality metrics.
3. Fees stay tiny. Core dividend ETFs often charge about 0.05 to 0.10 percent a year.

Many dividend ETFs are packed with stable, cash-producing companies like utilities, everyday consumer goods firms, and big financial companies, so they often wobble less when stocks swing hard, which helps when the market is volatile.

Which Trading Approach is Better? High Yield Or Dividend Growth

High-yield ETFs fit people who want income right now, often retirees or anyone using cash flow to cover bills.

• Tradeoff: Higher-yield funds often lean on mature sectors like financials, energy, utilities, and consumer staples.

Dividend growth ETFs fit people who can wait.

Yield starts smaller, but payouts usually rise faster over time because holdings are screened for consistent increases.

• Simple rule to follow in this case: Take high yield for current cash, take dividend growth for longer compounding, blend both for balance.

Risks To Know Before Treating ETFs Like A Money Machine

• Dividends can be cut in recessions. ETFs soften the hit, not remove it.
• Sector tilts are also important. High-yield funds can lag in growth-led bull markets.
• Yield traps exist inside funds. A few high-yield names may signal stress, so quality screens matter.

Even with those risks, dividend ETFs stay one of the cleanest ways to build passive income past the 4,200 dollar median, as long as capital is large enough.

High-Yield Savings Accounts And CDs

High-yield savings accounts and CDs are the boring workhorses of passive income, and in 2025, boring pays pretty well.

With interest rates still elevated, cash parked in the right place can generate returns that beat the old near-zero era by a mile.

What High-Yield Savings Pays In 2025?

Top high-yield savings accounts in late 2025 land around 4 to 5 percent APY, depending on the bank and promo offers.

That Translates to This

• 10,000 dollars earns roughly 400 to 500 dollars per year.
• 50,000 dollars earns roughly 2,000 to 2,500 dollars per year.
• 100,000 dollars earns roughly 4,000 to 5,000 dollars per year.

Hitting the 4,200-dollar passive income median is realistic with about 90,000 to 105,000 dollars in high-yield cash at current rates. Rates can move, so that the target shifts over time.

CDs – Higher Yield For Giving Up Flexibility

CDs usually pay a bit more than savings accounts if you lock money for a fixed term.

Terms from 6 months to 2 years often sit in the same 4 to 5 percent zone, sometimes higher for short promos.

The tradeoff is simple:

• Break a CD early, and you pay a penalty.
• Keep it to maturity, and the yield is predictable.

CD ladders help here. Split cash into several CDs with staggered maturities, like 6, 12, 18, and 24 months. Money keeps rolling free while a chunk stays locked at better rates.

Why Small Interest Income Still Matters?

High-yield savings and CDs will not make you rich overnight, so people often ignore them. Even so, they help a lot:

• Money keeps coming in. Interest shows up even when stocks fall, or a rental has a bad month.
• Cash stays ready. You can grab a good deal fast without selling other investments at a bad time.
• An easy way to judge other deals. If a bank pays around 5 percent, any risky investment should pay more than that to be worth the trouble.

Savings accounts and CDs stay safe, but a few limits exist:

• Prices can rise faster than interest. You might still lose buying power in high inflation years.
• Rates can change. Banks may cut promo rates, so check once in a while.
• Insurance has a cap. FDIC covers up to $250,000 per bank per person, so spread big amounts between banks.

Money Market Funds

Money market funds pay you for parking cash in ultra-short-term debt like Treasury bills and high-grade corporate paper.

Think of them as a cash pool that tries to keep value steady at about one dollar per share while passing interest back to investors.

They are popular in 2025 because yields stay high and access stays simple.

What Money Market Funds Pay In 2025?

Average seven-day net yields for US money market funds sit roughly in the 3.8 to 4.4 percent range in mid to late 2025, depending on category.

Government and Treasury funds trend near the upper end of that band, prime funds sit similarly, and tax-exempt municipal funds pay less because the income is federally tax-free.

Plain Math

• 10,000 dollars at about 4 percent yields around 400 dollars a year.
• 50,000 dollars yields around 2,000 dollars a year.
• 100,000 dollars yields around 4,000 dollars a year.

So a six-figure cash balance in a money market fund is already close to the $4,200 passive income median.

Why People Use Them Instead Of A Savings Account?

Banks offer safety and FDIC coverage.

Money market funds trade that the FDIC covers for a yield that often runs a bit higher and moves faster with Fed policy.

Main reasons people pick money market funds:

• Liquidity. Money is usually available the same day in a brokerage account.
• Competitive yield. Funds tend to track short-term rates closely, so payouts stay strong while rates stay high.
• Easy place to park cash. Great for emergency money, down payment funds, or waiting for a better investment entry.

Risk is Low, But Not Zero

• Not FDIC insured. Value aims to stay at one dollar, yet in extreme stress, a fund can dip below that level. Rare, but possible.
• Yield can fall fast. If the Fed cuts rates, payouts follow within weeks.
• Prime fund risk. Prime funds hold a bit more corporate paper than Treasury-only funds, so credit risk is slightly higher.

Bonds And Bond Funds (Treasuries, Municipal Bonds, Investment Grade Corporate Bonds)

Bonds are a deal where you lend money and get paid interest for the ride.

In 2025, they matter again because yields are back in a range that can produce passive income without stock level chaos.

Bonds also play defense. When stocks wobble, high-quality bonds usually hold steadier, and interest checks keep landing.

What Bonds Pay In 2025?

Treasury yields in late 2025 sit in a solid mid single-digit zone for longer maturities:

• 2 Year Treasury: about 3.5 percent
• 10 Year Treasury: about 4.0 percent
• 30 Year Treasury: about 4.7 percent

Simple Math at 4 Percent

• 10,000 dollars earns about 400 dollars per year
• 50,000 dollars earns about 2,000 dollars per year
• 100,000 dollars earns about 4,000 dollars per year

So a six-figure bond position can reach the $4,200 passive income median without needing property or stocks.

Treasuries as The Baseline For Safe Income

Treasuries are the safest regular income stream in the market because they are backed by the US government.

People use them as a stable anchor for cash flow, especially when the economic outlook looks uncertain.

Municipal Bonds Are Tax-Free Income

Municipal bonds come from states and cities. The big attraction is federal tax-free interest.

In 2025, longer-term high-quality munis can yield around 4.25 percent tax-free, which can translate to about a 7 percent taxable equivalent yield for investors in the highest tax brackets.

Investment Grade Corporate Bonds

Investment-grade corporate bonds pay more than Treasuries because companies can fail, even if big, stable ones rarely do.

A diversified corporate bond fund spreads risk over many issuers, which makes the income stream more reliable than buying one or two single company bonds.

Bond Funds vs Individual Bonds

Two main ways to use bonds:

• Individual bonds give a fixed maturity date and a known payout if held to the end.
• Bond funds and ETFs never mature, so prices move more with rate shifts, but they offer instant diversification and easy buying.

Most people choose funds for convenience. People building a predictable income ladder often choose individual bonds.

Risks To Keep In Mind

Bonds are safer than stocks, but risk does not vanish completely.

• Rate risk. When rates rise, older bonds drop in price. Longer-term bonds move more.
• Inflation risk. If inflation runs hot, fixed interest buys less.
• Credit risk. Corporate and lower-quality munis can default, so diversification matters.

Business Equity Income (Silent Stakes, Profit Distributions)

Business equity income is the most misunderstood passive stream in America. People picture founders grinding 90 hours a week, not passive checks.

Yet once a business runs without daily owner involvement, equity can pay like a rental property that never calls you at 2 a.m.

Profits get distributed, and money shows up because you own a slice, not because you clocked more hours.

Big payouts happen here because private businesses can throw off high margins, and owners control pricing, costs, and growth in a way public stock investors cannot.

Still, access and risk sit on another level compared with dividends or bonds.

How Business Equity Pays?

Equity income usually comes in two forms:

• Profit Distributions: The business earns more than it needs to operate, then sends owners a share.
• Owner Draws From A Managed Role: You keep ownership but hire managers to run the machine, turning your role into oversight rather than labor.

Well-run small businesses can deliver distribution yields in the high single digits or even low double digits on invested capital.

That range beats most public market yields, which explains why business owners often sit at the top of passive income charts.

Where Silent Stakes Come From

A silent stake means owning part of a business without running day-to-day operations.

Common routes include:

• Buying into a local business with an operating partner
• Funding a growing company in exchange for equity
• Holding shares after stepping back from a role you once ran
• Employee equity that keeps paying after a company reaches steady profit

For many households, the most realistic version is partnering with someone who has the skill and time to operate, while you bring capital and guidance.

Why The Upside Can Beat Everything Else?

Business equity can outpay rentals and dividends because owners control levers that markets do not.

• Growth lever: A business can raise profit by expanding locations, adding products, or tightening costs.
• Pricing lever: Strong brands can lift prices while holding demand.
• Operational leverage: Small improvements can multiply profit fast.

A single good business can pay as much as owning a few rentals.

But There are Risks

High payout potential comes with sharp risks.

• Concentration: A business can go sideways, and your income drops to zero.
• Execution: Even with a partner, success depends on management quality.
• Liquidity: You cannot sell a private stake in seconds like a stock. Exits take time.
• Legality: Contracts matter. A sloppy deal can turn “passive” into a nightmare.

Royalties And Digital Products (Books, Music, Courses, Apps, Content Libraries)

A song, an ebook, a template pack, a course, or an app can keep paying long after the heavy lifting ends.

Money here is not evenly spread. A small group earns a lot, while most creators earn pocket change.

What Royalties Usually Pay In 2025?

Payouts depend on audience size and on the platform cut.

• Ebooks and print-on-demand books: Many titles earn under 1,000 dollars a year, while successful niche books can bring 5,000 to 50,000 plus annually for years.
• Online courses: Lots of courses stall under 2,000 a year, yet a course with strong demand and good marketing can clear 10,000 to 100,000 plus a year.
• Apps and software tools: Most apps earn little, but a useful niche app with subscriptions can generate a steady four or five-figure annual income.
• Music and video royalties: Streaming pays small amounts per play, so meaningful income usually needs a big catalog or consistent audience traffic. The most popular music streaming platforms may pay even less, but the advantage is that you can reach a much wider audience.

How Digital Products Can Outperform Other Streams?

Three edges drive the ceiling:

• Near-zero cost per extra sale. A course sold to 10 people or 10,000 people costs almost the same to deliver.
• Global market by default. Platforms ship your product to any time zone without extra work.
• Catalog effect. A stack of small earnings can add up to a serious monthly check.

When a catalog grows, income tends to smooth out, because one product slowing down does not kill the whole stream.

What Actually Makes A Product Keep Paying

Long tail income usually comes from boring fundamentals, not viral luck:

• Solve a narrow problem. Niche beats broad.
• Evergreen topics. Skills or needs that stay relevant for years.
• Search traffic. Products that rank on Google, Amazon, YouTube, or app stores keep getting found.
• Updates and support. A small refresh once or twice a year can extend product life a lot.

There is a Different Sort of Risks in This Case

• Platform dependence. Rule changes, algorithm shifts, or fee hikes can cut income fast.
• Copycats. A good product gets cloned, so brand and community matter.
• Upfront grind. Writing, filming, coding, editing, and marketing take serious time before the first dollar lands.
• Income can fade. Trends move, so products need to be refreshed or replaced.

The Bottom Line

Passive income streams in the US in 2025 reward two things: capital and patience.

Stick to the numbers, know the risks, and choose a stream that fits the budget and lifestyle you have right now.

Start with something steady, then move into higher-paying options as experience builds and capital gets larger.

Done that way, passive income can grow from a small bonus into a steady income stream.