It is essential to plan for retirement, whether you’re 2 days away from it or 20 years away from it. As of May 2026, retirees are navigating a unique landscape where the 2.8% Social Security COLA must be balanced against a neutral interest rate environment.
While there are multiple strategies for investing, there’s no one-size-fits-all approach that can guarantee a financially stable retirement. Some investors prefer to invest in individual stocks to build a diversified portfolio, while many others choose to invest in exchange-traded funds (ETFs).
If you prefer the second option, choosing from the hundreds of ETFs can feel overwhelming. But, if you pick the right funds and remain invested for a long period of time, you can stop worrying about retirement. Building an ETF portfolio is much easier than picking individual stocks. If I’m retiring today, here are the three ETFs I’d buy.
JPMorgan Nasdaq Equity Premium ETF
The JPMorgan Nasdaq Equity Premium Income ETF (NYSEARCA:JEPQ) is a top-quality ETF that currently boasts an exceptional forward yield of 11.82%. It uses a covered call strategy to generate a premium and maintain the high yield. As the first step, it uses a fundamental data science approach to build a strong portfolio, and second, it implements out-of-the-money call options to generate monthly income. The fund has an expense ratio of 0.35%.
JEPQ pays monthly dividends—with the May 2026 payout reaching $0.5910 per share—and owns a portfolio of 108 stocks focused on the Nasdaq. It allocates 41% of the portfolio to the technology sector, which is followed by 12.5% in communication services and 10.6% towards consumer discretionary.
The top 10 holdings include the Magnificent Seven and comprise 41% of the portfolio. The fund has the highest allocation to Nvidia at 7.40%. JEPQ has shown significant resilience in 2026, recently exchanging hands near $58.86. However, it generates monthly passive income, which makes it stand out amongst the sea of ETFs. I’d buy JEPQ for the high yield and the reliability of a steady paycheck.
Amplify CWP Enhanced Dividend ETF
Next up is Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO). It also uses a covered call strategy to enhance income and currently maintains a steady yield around 4.8%. With ETFs that use a covered call strategy, there’s a risk that the stock sometimes rises so much that its strike price is hit and the stock gets called away. But DIVO successfully manages to balance risk and return by focusing on high-quality dividend growth names like Microsoft and JPMorgan Chase.
It restricts the holdings to 34 stocks and invests in large-cap companies that have a history of dividend and earnings growth. On the average annualized return basis, it has generated an impressive 1-year total return of 18.87%. Besides the monthly income, DIVO also generates capital appreciation, recently exchanging hands for approximately $46.66.
Invesco S&P 500 High Dividend Low Volatility
I went with the Invesco S&P 500 High Dividend Low Volatility ETF (NYSEARCA:SPHD) since it pays a steady dividend while ensuring low volatility. In a landscape where 10-year Treasuries hover near 4.5%, SPHD’s 4.83% yield provides a critical buffer. It tracks the S&P 500 Low Volatility High Dividend Index and invests in 50 stocks to avoid value traps.
It focuses on value-focused sectors like energy, consumer staples, and utilities. Its top 10 holdings include real estate investment trusts (REITs) such as Realty Income and Healthpeak Properties Inc., alongside Verizon Communications and Pfizer Inc. It is another fund that pays monthly dividends, making it an ideal choice for the retirement period. I like the ETF for the low volatility and steady passive income, recently gaining 4.44% over the past year and exchanging hands for $52.
Competitive Landscape and Macro Strategy
While JEPQ, DIVO, and SPHD remain stalwarts, retirees in 2026 should also consider tax-efficient alternatives like SPYI (NEOS S&P 500 High Income ETF), which utilizes Section 1256 contracts to potentially lower tax burdens. For those seeking even higher yields in the tech sector, QQQI (NEOS Nasdaq-100 High Income ETF) currently offers a distribution yield near 14.3%. Combining these monthly income streams with tools like a Social Security Calculator allows for a more robust defense against rising taxable earnings caps and economic uncertainty.
Editor’s Note: This article was updated in May 2026 to include current forward yields for JEPQ and DIVO, recent distribution data, and current share prices. New sections were added regarding the 2026 Social Security COLA impacts, the comparative performance of high-income alternatives like SPYI and QQQI, and the strategic positioning of these funds against current 10-year Treasury yields.
Top Gaining Stocks
Top Losing Stocks