I love to invest in real estate investment trusts (REITs). These entities generate lots of passive income and tend to deliver attractive total returns (dividend income plus capital gains). I hold several REITs in my portfolio.
Put it on cruise control. It's a way to make driving on long trips easier. It's also a way to make passive income easier. There's no simple button to push for generating passive income like there is on a car.
Not only do they have the potential to grow over time, but more importantly, they earn reliable passive income. Real estate investment trusts (REITs) are my favorite type of dividend stock to buy because they are required to pay at least 90% of taxable income in dividends, earning more income than a traditional dividend stock can offer. EPR Properties (NYSE: EPR), Medical Properties Trust (NYSE: MPW), and Simon Property Group (NYSE: SPG) all have dividend yields of 6% or more right now -- close to three times more than the dividend return of the S&P 500.