How to Turn $75,000 Into $7,000 in Annual Passive Income
A retirement portfolio that replaces a missing paycheck needs cash that arrives on schedule, not just when markets cooperate. Six high-yield names across pipelines, tobacco, and private credit can get you surprisingly close to that target on a modest starting…
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For retirees, the toughest part of leaving a paycheck behind is losing its cycle. Social Security and any pension income set a floor. Your portfolio must fill the gap between that floor and the retirement you planned, ideally with cash that arrives on schedule whether the market is up or down.
High-yield dividend stocks are one way to fill that gap. Here is what a $12,500 stake in each of these six high-yield names would return, for a total investment of $75,000. At current prices and forward payout rates, the group produces $6,873.76 in annual passive income, a combined yield of 9.17%. That is $126.24 short of $7,000 in year one. If you reinvest the first year of payouts at the same combined yield, year-two income comes to about $7,503.75, assuming prices and payouts stay where they are.
The group includes three business development companies (BDCs), two midstream master limited partnerships (MLPs), and a tobacco company. The stocks are listed from lowest yield to highest.
Enterprise Products Partners
- Stock #6: Enterprise Products Partners (NYSE:EPD | EPD Price Prediction)
- Yield: 6.05%
- Units for $12,500: 337.56
- Annual Passive Income: ~$756.14
Enterprise Products runs pipelines, processing plants, storage and export terminals that move natural gas liquids, crude oil, natural gas and petrochemicals. Second-quarter 2026 adjusted EBITDA reached a record $2.83 billion (+17% year over year), and marine terminal volumes rose 33% to a record.
As an MLP, the partnership passes most of its cash flow through to unitholders. Its quarterly distribution of $0.56 annualizes to $2.24. Operating distributable cash flow of $2.3 billion covered the payout 1.9x, which is among the best coverage in midstream. Units are issued with a K-1, and IRA holders should keep in mind that MLP income can produce unrelated business taxable income (UBTI) inside a retirement account.
Altria
- Stock #5: Altria (NYSE:MO)
- Yield: 6.40%
- Shares for $12,500: 180.17
- Annual Passive Income: ~$799.94
The company sells Marlboro, Copenhagen, Skoal, On!, and NJOY. Its high yield reflects a mature business with declining cigarette volumes that pays out most of its free cash flow as dividends. Altria raised its quarterly dividend to $1.11 from $1.06, and it pays out on October 9, 2026.
On safety, Altria pays out about 75% to 80% of adjusted EPS. It reaffirmed full-year 2026 adjusted EPS guidance of $5.56 to $5.72. The main risk is that Marlboro’s retail share fell to 39.7%.
Energy Transfer
- Stock #4: Energy Transfer (NYSE: ET)
- Yield: 6.59%
- Units for $12,500: 605.33
- Annual Passive Income: ~$823.24
Energy Transfer runs interstate and intrastate gas pipelines, NGL and crude systems, and export terminals. Second-quarter adjusted EBITDA climbed to $5.07 billion (+31% year over year), and full-year guidance rose to $18.8 billion to $19.1 billion.
Its $0.34 quarterly distribution was the 19th consecutive quarterly increase. Adjusted distributable cash flow rose to approximately $2.6 billion from $2.0 billion a year earlier. Management is aiming for “a long-term annual distribution growth rate of 3 to 5 percent.” Energy Transfer is also an MLP that issues K-1s, so the same UBTI consideration applies to IRA holders.
Ares Capital
- Stock #3: Ares Capital (NASDAQ:ARCC)
- Yield: 10.42%
- Shares for $12,500: 678.61
- Annual Passive Income: ~$1,302.93
Ares is the largest publicly traded BDC. It lends to middle-market companies through a $29.35 billion portfolio spread across 619 companies. Its yield is high because the BDC structure requires it to pay out about 90% of taxable income.
Second-quarter core earnings of $0.47 per share came in just under the $0.48 dividend. Management noted that core earnings exceeded the regular dividend over the trailing 12 months. It also cited spillover income of $1.38 per share as a buffer. Non-accruals rose to 2.4% at cost, and the dividend has been stable or rising for 17 consecutive years.
Blue Owl Capital
- Stock #2: Blue Owl Capital (NYSE:OBDC)
- Yield (base distribution): 12.38%
- Shares for $12,500: 1,247.50
- Annual Passive Income: ~$1,546.91
Blue Owl Capital Corporation holds a $14.96 billion portfolio, mostly first-lien loans. This year, it cut its base dividend to $0.31 from $0.37. Adjusted net investment income (NII) of $0.34 covered the new base 110%, although part of that came from a one-time Mavis realization. Spillover income of about $0.29 per share adds a buffer.
Supplemental payouts, such as the recent $0.02, are extra and not counted in this income figure. Shares are down 11.63% year to date, as concerns about the private credit market have grown. Reuters reported that withdrawal requests at a major Blue Owl fund slowed as private credit turmoil eased.
Blackstone Secured Lending Fund
- Stock #1: Blackstone Secured Lending Fund (NYSE:BXSL)
- Yield: 13.16%
- Shares for $12,500: 533.96
- Annual Passive Income: ~$1,644.60
This Blackstone-managed BDC holds 96.8% of its portfolio in first-lien senior secured loans, and 96.3% of the portfolio is floating rate. It has paid $0.77 per share every quarter since late 2023.
Coverage is tighter here. Second-quarter NII of $0.75 covered 97% of the dividend. NAV fell to $25.53 from $27.33, Moody’s has a Baa2 negative outlook on the fund, and co-CEO Jonathan Bock resigned in late July 2026. The top yield in this group shows those risks.
Six Positions, One Income Stream
| Name | Yield | Annual Dividend Income |
|---|---|---|
| Enterprise Products Partners | 6.05% | $756.14 |
| Altria Group | 6.40% | $799.94 |
| Energy Transfer | 6.59% | $823.24 |
| Ares Capital | 10.42% | $1,302.93 |
| Blue Owl Capital | 12.38% | $1,546.91 |
| Blackstone Secured Lending Fund | 13.16% | $1,644.60 |
| Total | 9.17% | $6,873.76 |
Together, these six holdings yield $6,873.76 of passive income each year on a $75,000 investment, a combined yield of 9.17%. Blackstone Secured Lending contributes $1,644.60, Blue Owl adds $1,546.91, Ares adds $1,302.93, Energy Transfer adds $823.24, Altria adds $799.94, and Enterprise Products adds $756.14 to complete the set.
Getting to $7,000 a year depends on reinvesting. Reinvesting every distribution purchases more shares, so each quarterly payment is slightly larger than the last. Over time, that compounding can transform an initial income stream into a substantially larger one.
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Lee Jackson has covered Wall Street analysts' equity and debt research and equity strategy daily for 24/7 Wall St. since 2012. His broad, diverse career, including a stint as creative services director at an NBC affiliate in Austin, Texas, gives him unique insight into the financial industry.
Lee Jackson's journey in the financial industry spans more than 30 years, including nearly two decades as an institutional equity salesperson at Bear Stearns, Lehman Brothers, and Morgan Stanley. His career spanned pivotal sell-side Wall Street events, from the dot-com rise and bubble to the Long-Term Capital Management debacle, 9/11, and the Great Recession of 2008. This reflects his resilience and adaptability amid market volatility.
Lee Jackson’s practical financial industry experience, gained through a career at some of the biggest banks and brokerage firms, is complemented by a lifetime of writing across various platforms. This unique combination allows him to shed light on the intricacies of Wall Street in a way only someone with deep insider experience and knowledge can. Moreover, his extensive network across Wall Street continues to provide direct access for him and 24/7 Wall St., a privilege few firms enjoy.
Since 2012, Jackson’s work for 24/7 Wall St. has been featured in Barron’s, Yahoo Finance, MarketWatch, Business Insider, TradingView, Real Money, The Street, Seeking Alpha, Benzinga, and other media outlets. He attended the prestigious Cranbrook Schools in Bloomfield Hills, Michigan, and has a degree in broadcasting from the Specs Howard School of Media Arts.
