In a world that is full of potential market volatility, and maybe there is, maybe there isn’t “AI bubble,” investors, mostly of the retail variety, are looking for a safe place to park their cash. As a result, ETFs have been surging in popularity in 2025 as hopeful investors want to go for a ride and earn money as the “FAANG” stocks push the market to new heights.
As the world looks to 2026, investors are heading into this year with a new mindset. This is especially true as cash yields are slipping from recent highs and the bond world looks a little more uncertain as interest rates are likely to drop again, at least a few times in the next 12 months.
Why ETFs Matter for Income Investors in 2026
Before 2026 arrives, there are three ETFs that stand out for investors who are looking for income stability, long-term performance, and broad diversification. Some of the best recommendations aren’t high-yield funds, but ETFs, where their total return profiles have become essential for portfolios that rely on dividends and capital appreciation to fund retirement.
For income investors who focus on yield, it’s worth remembering that high yield without growth can lead to flat returns over time. This is a truth that most people need to acknowledge before 2026, in that their portfolios are going to need growth engines that work in parallel with dividend payouts to increase the overall value of their portfolio.
Sadly, cash and CDs cannot do this, and they certainly can’t do it alone. As a result, investors need to look at ETFs like the three options below and remind themselves that by investing in these options, they are doing what they need to do to avoid leaving money on the table that they might regret in the future.
iShares Core S&P 500 ETF
Investors looking for an ETF that might work well as the backbone of a portfolio should look no further than iShares Core S&P 500 ETF (NYSE:IVV) as a durable and core holding that can be used to build a portfolio around.
In 2025, the iShares Core S&P 500 ETF has returned 15.66% to shareholders year-to-date, and over 24.28% over the last 36 months. These returns exceeded category averages and help reinforce why total-market exposure can and still should play a role in an income strategy.
The current 1.17% dividend yield and $7.76 annual dividend are almost certainly the most appealing aspects of this ETF. As cash yields fall, it’s hard to ignore the benefits of something like the iShares Core S&P 500 ETF, which is full of large-cap US companies that are continuing to raise their dividends, all while delivering consistent earnings. The delivery on both sides helps make iShares Core S&P 500 ETF a foundational position inside investor portfolios.
Invest QQQ Trust
In the world of ETFs, the Invest QQQ Trust (NASDAQ:QQQ) needs no introduction. While the Invest QQQ Trust isn’t traditionally used as a dividend driver, it is offering a $2.84 annual dividend as of November 2025.
Even with a low yield, the Invest QQQ Trust offers premium capital appreciation that is going to allow retirees to withdraw income without touching their principal. It’s for this reason that this ETF is often viewed as a smart passive income enhancer. Better yet, the Invest QQQ Trust has delivered 20.07% YTD for investors and a wonderful 32.31% in the last three years. This is not only well above category averages, but names like Microsoft, Apple, Broadcom, NVIDIA, and Meta are helping to drive growth, making the long-term story of the Invest QQQ trust feel very strong.
Even conservative income investors can make use of this ETF to help capture tech-driven returns while they are still moving the market to new highs seemingly every day.
Vanguard Information Technology ETF
Last on this list, the Vanguard Information Technology ETF (NYSE:VGT) is a pure technology ETF that has unsurprisingly outperformed just about every major index over the last 10 years.
With a 0.42% dividend yield and $3.07 annual dividend, it won’t come as any surprise to learn that income investors should look at the Vanguard Information Technology ETF as a way to future-proof their portfolios. Companies inside this ETF are increasingly moving to become significant players in the dividend world and dividend growers as well, which is the most important part.
Over the last year, this ETF has delivered a 23.01% return to investors and 35.56% over the last three years, once again, beating category benchmarks. These returns are important to know for income investors because you get the benefit of both growth and passive income.
The Bottom Line for 2026
At the end of the day, as we move into 2026, investors need to know that income investing is changing, and they can no longer rely just on high-yield picks or cash accounts to meet long-term goals. Instead, portfolios need to have consistent dividend players as a central component, and long-term growth ETFs help fulfill this role, all while bringing the right amount of growth and flexibility.