The S&P 500's dividend yield is a rather pedestrian 1.4% these days. At that rate, you could earn about $14 of annual dividend income for every $1,000 invested in an S&P 500 index fund.

Many stocks offer higher yields -- some considerably more. One of the more compelling options for yield-seeking investors is master limited partnerships (MLPs). While MLPs can complicate your taxes (they send K-1s instead of 1099-DIVs), the extra income can be well worth it. Top MLPs Energy Transfer (NYSE: ET) and MPLX (NYSE: MPLX) currently yield over 8%. At that rate, a $1,000 investment would generate over $80 in annual income.

Visible income growth

Energy Transfer offers an 8.3%-yielding distribution. That monster payout is very bankable. The midstream giant generates stable cash flow of roughly $7.5 billion annually because fees supply about 90% of its earnings. Meanwhile, the company pays out a conservative portion of its steady cash flow (around 50%, or $4 billion). That gives it a huge cushion while enabling it to retain money to fund its organic expansion program ($2 billion-$3 billion annually) with room to spare. It uses its excess free cash (about $500 million to $1.5 billion per year) to maintain a strong balance sheet and opportunistically repurchase its units.

The company also has a very solid balance sheet. Energy Transfer expects its leverage ratio to be in the lower half of its 4.0x-4.5x target range this year. That gives it additional financial flexibility to make acquisitions. Energy Transfer is a consolidator in the midstream sector. It made two deals last year, including buying fellow MLP Crestwood Equity Partners for $7.1 billion. Those acquisitions enhanced its operations while growing its distributable cash flow.

Energy Transfer's growth-focused investments will increase its sources of steady cash, which is why management believes it can boost its already sizable distribution. It aims to lift that payout by 3% to 5% per year by slightly raising its distribution payment each quarter. That makes it an excellent source of steadily rising passive income.

A potentially high-octane income stream

MPLX currently pays an 8.4%-yielding distribution. That big-time payout is also on a very firm foundation. The MLP generates predictable cash flow backed primarily by long-term contracts with quality customers, including its parent company, refining giant Marathon Petroleum.

Last year, MPLX produced $5.4 billion in net cash provided by operating activities. That covered its distribution payments ($3.3 billion) and capital expenses ($1.3 billion) with over $800 million to spare. It used some of that excess free cash to acquire the remaining 40% interest in a gathering and processing (G&P) joint venture from its partner for $270 million.