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If you’re like me, you may be building a list of the top dividend shares to buy for 2025. I’m looking for robust stocks that could make me a large second income this year, as well as one that grows over time.
With this in mind, here are two high-yield FTSE 100 and FTSE 250 shares that have caught my eye.
| Dividend share | 2025 dividend yield |
|---|---|
| Supermarket Income REIT (LSE:SUPR) | 8.9% |
| Legal & General Group (LSE:LGEN) | 9.5% |
Dividend yields are based on broker projections and therefore aren’t guaranteed. But I’m optimistic these top shares will meet their dividend forecasts for 2025.
If estimates indeed prove accurate, a £20,000 investment spread equally across them would provide a terrific £1,840 passive income.
Here’s why I think they deserve serious consideration.
The FTSE 250 stock
Supermarket Income REIT’s designed to provide investors with abundant dividend income. Under real estate investment trust (REIT) rules, it must — in exchange for certain tax breaks — pay at least 90% of annual profits from its rental operations out in the form of dividends.
This doesn’t necessarily guarantee a large passive income. Some REITs operate in cyclical industries where occupancy and rent collection issues can spring up during downturns.
These are problems Supermarket Income doesn’t have to worry about. As its name implies, it operates in the highly stable food retail market. On top of this, it only lets out its properties to financially robust, blue-chip grocers.
The 70-plus stores on its books are occupied by industry heavyweights including Tesco, Sainsbury’s, Marks & Spencer and Carrefour.
The trust isn’t completely without risk however. Earnings may suffer if interest rates fail to fall, putting the dampener on net asset values (NAVs). But on balance it’s a solid dividend stock to consider in these uncertain times.
Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.
The FTSE 100 share
Legal & General’s another share that could suffer if persistent interest rate pressure dampens consumer spending. On top of this, profits may suffer if financial market volatility impacts returns at its asset management division.
Yet even if they transpire, these problems are unlikely to affect the company’s long record of paying growing and market-mashing dividends. This is thanks to Legal & General’s eye-popping Solvency II capital ratio which, at 223% as of June, was one of the strongest across the entire sector.
The company’s £200m share buyback programme that completed in November — combined with its pledge to pay make similar levels of repurchases going forwards — underlines the strength of its balance sheet.
Legal & General’s a cash-generating machine, giving it financial clout to pursue growth while also doling out large dividends. As a long-term investor, I’m encouraged by the huge structural opportunities it’s likely to have in the future — namely, rising demand for wealth, protection and retirement products as its markets rapidly age and become more financially savvy.
I already own Legal & General shares in my Self-Invested Personal Pension (SIPP). And following 2024’s share price fall, I’m seriously tempted to buy some more.
