Top 5 Dividend ETFs For 2025

Globe and Mail

4 days ago

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These five dividend ETFs continue to offer low expense ratios, solid sector diversification, and reliable dividend income in 2025.
For investors looking to build a durable equity income portfolio, these ETFs remain among the top choices. While they still leave out a few useful sectors (real estate, utilities), they make a strong starting point for long-term investors who want their portfolio to actually pay them.
SCHD: Still a Favorite for Quality and Yield
The Schwab U.S. Dividend Equity ETF (SCHD) remains one of the most popular dividend ETFs for good reason. With an expense ratio of just 0.06%, it provides exposure to high-quality U.S. companies with consistent dividend histories. SCHD leans heavily into consumer staples and industrials, while underweighting financials and avoiding real estate altogether.
It's a great core holding for long-term investors, but those building a more balanced portfolio may want to add complementary exposure to sectors SCHD leaves out - like real estate, utilities, or floating-rate preferred shares.
VYM: The Classic High-Yield Workhorse
The Vanguard High Dividend Yield ETF (VYM) continues to be a strong option for income-focused investors. Also carrying a rock-bottom 0.06% expense ratio, VYM holds over 400 U.S. stocks with above-average dividend yields. It includes solid exposure to financials and energy - two sectors often underrepresented in other dividend-focused funds.
VYM doesn't try to outsmart the market - it focuses on companies that actually pay. That's why it remains one of the most consistent picks in the dividend ETF space. It also makes a great pairing with SCHD for those who want both quality and yield in their portfolio.
VIG: For Dividend Growth Enthusiasts
The Vanguard Dividend Appreciation ETF (VIG) doesn't chase yield - it focuses on companies with a long history of increasing dividends. With a 0.06% expense ratio, VIG offers exposure to companies that tend to be more stable and less cyclical, but also leans heavily into the industrials sector.
VIG skips real estate and carries minimal energy exposure, so it may not be ideal as a standalone holding. However, for investors looking to prioritize long-term dividend growth over raw yield, it makes a lot of sense - especially when paired with something more income-oriented like HDV or SCHD.
DGRO: Balanced, Understated, Effective
The iShares Core Dividend Growth ETF (DGRO) is often overlooked but deserves more attention. It blends dividend growth with moderate yield and includes meaningful exposure to financials and tech. The fund charges a slightly higher expense ratio of 0.08%, but it makes up for it with a well-diversified portfolio that avoids major concentration risk.
DGRO doesn't swing for the fences, but it rarely strikes out either. For investors who want a middle-of-the-road fund that complements either high-yield or high-growth ETFs, DGRO is a great pick in 2025.
HDV: High-Yield Defense When You Need It
The iShares Core High Dividend ETF (HDV) is the most defensive option on this list. It focuses on companies with stable earnings and high dividend yields, and tends to lean into sectors like healthcare and consumer staples. Its expense ratio is 0.08%, and its yield remains one of the highest among the big-name dividend ETFs.
HDV tends to underweight financials and avoids energy and real estate. That makes it a bit less well-rounded, but great for income investors who want lower beta and a strong defensive tilt.
One Glaring Omission: Real Estate (Again)
As with previous years, none of these five ETFs offers meaningful exposure to real estate. That's a recurring blind spot - and an easy one to fix. Investors can add a fund like the Vanguard Real Estate ETF (VNQ) or choose from individual REITs like (O), (NNN), or (WPC) to round out the portfolio. The yield from quality REITs also pairs well with the more defensive holdings in this group.
It's important to note that we easily beat our benchmark from inception. That includes our choices or REITS, mREITS, BDCs, and preferred shares.
Bonus Pick: Want Tech Exposure Without Giving Up Your Dignity?
While none of the five ETFs above offer real exposure to big-name tech stocks, investors who want to stay connected to the modern economy can consider the Vanguard Information Technology ETF (VGT). It's not a dividend fund, but it includes (AAPL), (MSFT), (NVDA), (TSLA), and other heavyweights at a low cost (0.10% expense ratio).
Adding VGT won't do a lot to boost your income via dividends, but it can add some long-term capital appreciation while helping you keep up with what the kids are doing.
Final Thoughts
The five core dividend ETFs - SCHD, VYM, VIG, DGRO, and HDV - continue to provide excellent foundations for income-oriented portfolios in 2025. They've stood the test of time with low fees, strong management, and reliable performance.
You'll still need to plug a few holes (real estate, utilities, maybe preferred shares), but you're starting with a very solid base.
Now go get your dividends.
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This article was compiled by my assistant. If there are any mistakes, blame him - I certainly will.
Disclosure: I currently have a position in O . I may frequently trade in the preferred shares of any mortgage REIT and occasionally in the common shares.