Finding a savings account or term deposit offering a yield of more than 5% is impossible these days. The best you could do would be around 1.8% per annum, by my reckoning. Thank record low interest rates. But the same cannot be said for ASX dividend shares.

Whilst a dividend-paying share does not offer the same kind of certainty as a term deposit, savings account or bond (far from it), you can be compensated by yields of 3, 4 or 5%. Never a settler, I've found 2 ASX dividend shares that indeed offer yields of more than 5% today, and will (in my view) well into the future.

2 ASX dividend shares offering yields over 5%

Telstra Corporation Ltd (ASX: TLS)

Telstra is our first dividend share offering a yield of more than 5%. The Telstra share price has not had a good month. Investors were spooked by the company's pessimistic FY2020 earnings report released last month. Although Telstra did report an earnings slump of 9.7% and a 14.4% hit to profits, it also reaffirmed it's 16 cents per share dividend. On current share prices, that would give Telstra a trailing dividend yield of 5.63% (or 8.04% grossed up with Telstra's full franking).

Some commentators are assuming that Telstra will have to trim this dividend next financial year due to falling earnings. But looking at Telstra's free cash flow, which should be more than enough to cover a 16 cents per share payout in FY21, I don't agree with this thesis. Thus, I think Telstra remains a top dividend share to buy for income today. Especially at current 52-week low prices.

2) SPDR S&P Global Dividend Fund (ASX: WDIV)

Turning to an exchange-traded fund (ETF) now, here we have this globally focused income fund from SPDR. WDIV holds a basket of 75 dividend-paying shares from around the world, with only companies delivering steady or increasing dividends over the past decade selected. Canada and the United States are heavily weighted in this ETF, as well as Hong Kong and the United Kingdom. Some of WDIV's holdings include Enagas, Nokian Tyres and Japan Tobacco, as well as our own AGL Energy Limited (ASX: AGL) and Commonwealth Bank of Australia (ASX: CBA).

I think getting exposure to dividend-paying shares outside the ASX bubble is a great way to bulk up and diversify an ASX income-focused portfolio. Remember, you're not too diversified if all you hold is four ASX bank shares and a couple of miners. WDIV currently offers a healthy trailing dividend yield of 5.62% and charges a management fee of 0.5% per annum.

The post 2 ASX dividend shares with yields over 5% today appeared first on The Motley Fool Australia.

ASX dividend shares are my favourite shares to own. Don't get me wrong, I love a good growth share as much as anyone. But that feeling of getting paid just for owning something is pretty hard to beat. And that's what a quality dividend share does like clockwork. So with this in mind, here are 3 ASX dividend shares I think would make great buys in July.

3 ASX dividend shares to buy this month

1) WAM Leaders Ltd (ASX: WLE)

WAM Leaders is a listed investment company (LIC) run by the reputable Wilson Asset Management. This LIC is a newer addition to the WAM stable, only starting life in May 2016. But since then, it has delivered an average annual return of 9.8% (before fees and taxes). It focuses solely on the top end of the ASX, investing mostly within the ASX 50. Some of its top holdings include Australia and New Zealand Banking Group Limited (ASX: ANZ), Telstra Corporation Ltd (ASX: TLS) and BHP Group Ltd (ASX: BHP).

WAM Leaders recently announced a 3.25 cents per share final dividend, which takes its annualised yield to around 5.73% (or 8.19% grossed-up with full franking).

2) Coles Group Ltd (ASX: COL)

Coles is my second dividend pick for July. This supermarket giant is a highly defensive, recession-resistant business by virtue of the foods, drinks and household essentials it sells. I think these characteristics are especially useful as a dividend investment in the uncertain times we currently all live in.

Looking further ahead, I think Coles' plans to automate its supply lines and distribution networks is a definite positive for the company and should help it deliver plenty of earnings growth down the road. Right now, Coles is offering a trailing dividend yield of 2.38%, which grosses-up to 3.4% with full franking. This yield isn't going to set the world on fire, but it could well be a lot better than what Westpac Banking Corp (ASX: WBC) and ANZ are offering this year.

3) SPDR S&P Global Dividend Fund (ASX: WDIV)

This exchange-traded fund (ETF) isn't one company, but instead holds a basket of dividend-paying shares that hail from all over the world. Having some dividends coming in from outside the ASX is important from a diversification perspective, in my view. And WDIV is a great candidate for providing this international exposure. It only holds companies that have either held steady or increased their dividend payouts over the past 10 years.

It's fairly evenly spread between American, Canadian, Japanese, Hong Kong, British and European companies with even some ASX shares like AGL Energy Limited (ASX: AGL) thrown in. Some other top holdings include Enagas, IG Group, Northland Power and Japan Tobacco.

Today, WDIV is offering a trailing dividend yield of 5.49% (which unfortunately doesn't come with much in the way of franking credits).

The post 3 ASX dividend shares to buy in July appeared first on The Motley Fool Australia.

Finding good-quality ASX dividend shares for income in 2020 has become something of a sport. This year, the normal ASX dividend paradigm has been turned on its head.

The ASX banks which were the kings of the ASX divided hill are now its paupers. Dividend aristocrat, Ramsay Health Care Limited (ASX: RHC) has suspended its dividends – ending a 20-year streak of dividend growth. Shares like Transurban Group (ASX: TCL) and Sydney Airport Holdings Pty Ltd (ASX: SYD) which used to be regarded as the safest income providers on the ASX are now struggling to tell investors how much to expect this year.

Considering all of these factors, I think we need to look outside the box for income in 2020. So here are 2 ASX dividend shares that I would consider if I were seeking top-quality income this year.

SPDR S&P Global Dividend Fund (ASX: WDIV)

This exchange-traded fund (ETF) invests in a basket of global shares that are screened for dividend reliability. In order to make the cut, WDIV's holdings need to have either grown, or at least maintained their dividend payments over the past 10 years. As such, I think this is a great option for a diversified income investment in 2020.

Some of this ETF's top holdings include Freenet AG, Enagas, Japan Tobacco and our own AGL Energy Limited (ASX: AGL). It's also fairly well balanced across many different countries (19 in total). WDIV currently offers a trailing dividend yield of 6.13%.

Rio Tinto Limited (ASX: RIO)

I think the ASX resources sector is one of the best avenues to explore for ASX dividend shares in 2020. Most commodity prices have held up remarkably well across the board during the coronavirus pandemic – especially iron ore. And that's primarily what mining giant Rio Tinto is in the business of extracting. Rio has iron ore mines all over the world, as well as several other smaller operations for diamonds, copper and gold.

With iron ore prices now comfortably sitting at multi-year highs above US$100 per tonne, Rio looks set to be able to fund generous dividend payments to its shareholders this year. On current prices, Rio shares are offering a trailing dividend yield of 5.66%, or 8.09% grossed-up. I wouldn't be too surprised if Rio tops this trailing yield in 2020. Especially if iron ore continues to stay near its current levels.

The post 2 top ASX dividend shares for income in 2020 appeared first on The Motley Fool Australia.

With June almost upon us (insert obligatory comment about how fast the year is flying by), it's a great opportunity to examine our ASX share portfolios, and particularly our dividend shares.

2020 has been a topsy-turvy year so far for many reasons, with the shifting paradigm for ASX dividend shares part of the story.

Former ASX dividend share stalwarts like the banks are now dividend cutters. 'Safe' ASX shares like Transurban Group (ASX: TCL) are leaving income investors hanging.

So if I wanted to top up my portfolio's income potential this June, here are 3 ASX shares I would use to do so:

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

'Soul Patts' is one of the best dividend shares on the ASX (in my opinion) and also one of the only shares I trust to keep its dividend flowing this year. In fact, I believe it to be ASX dividend royalty. Soul Patts has paid out a dividend every year of its existence (which goes back to 1903). Not only that, but this company has also increased its dividend payments every year for the last 20 years.

Soul Patts' large stakes in ASX shares like TPG Telecom Ltd (ASX: TPM) and Brickworks Limited (ASX: BKW) pour cash into the company's coffers, whilst also giving it broad exposure to the Australian economy. Thus, if I had to choose a dividend share to buy this June, Soul Patts would be at the top of my list.

WAM Research Limited (ASX: WAX)

WAM Research isn't too far behind though. This is a Listed Investment Company (LIC) that invests in small and mid-cap ASX shares like Tassal Group Limited (ASX: TGR) and City Chic Collective Ltd (ASX: CCX).

This company has proven its know-how, in my view, having delivered an average annual return of 13.4% over the past 10 years. On current prices, WAM Research shares are offering a trailing yield of 6.99%. Although WAX shares usually trade at a premium to their underlying Net Asset Value, I believe this hefty yield more than makes up for this fact.

SPDR S&P Global Dividend Fund (ASX: WDIV)

My last ASX dividend share for June is actually an exchange-traded fund (ETF). WDIV invests in dividend-paying companies from beyond our shores, specifically those which have held or increased their dividends for 10 years or longer. Its holdings are balanced fairly evenly between American, Canadian and Japanese companies, with the United Kingdom, France, Hong Kong and Australia also represented.

Thus, I think this ETF can provide some great global exposure and diversification to an ASX dividend portfolio. Some of its top holdings include Freenet AG, Enagas, Japan Tobacco and our own AGL Energy Limited (ASX: AGL). WDIV offers a trailing yield of 6.01%.

The post 3 top ASX dividend shares to buy this June appeared first on The Motley Fool Australia.

2020 is shaping up to be a year to forget when it comes to dividends. We have seen ASX companies cut dividends across the board this year, including from some ASX income heavyweights.

Dividends from ASX banks like Westpac Banking Corp (ASX: WBC) have gone up in smoke. It's the same with distributions from real estate investment trusts (REITs) like Scentre Group (ASX: SCG) and would-be dividend aristocrat Ramsay Health Care Limited (ASX: RHC).

It's a brave new world for income investors, that's for sure.

That's why I think a great strategy for investors seeking dividend income in 2020 is to go for diversification. With an exchange-traded fund (ETF), you can buy dozens (if not hundreds) of income-paying companies within one share!

Here are 3 ideas to get you started:

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This ETF from Vanguard aims to hold a large basket of ASX dividend-paying shares. It currently holds 62 ASX-listed companies, which include the big banks, BHP Group Ltd (ASX: BHP), Telstra Corporation Ltd (ASX: TLS) and Wesfarmers Ltd (ASX: WES).

Although many of these holdings will be pulling back on their dividends in 2020, many will not as well. All in all, I see this ETF as a collection of some of the best yielders on the ASX.

SPDR S&P Global Dividend Fund (ASX: WDIV)

This ETF can be used as a great compliment to VHY as it invests in top-notch dividend payers from around the world.

WDIV only holds stocks that have maintained or increased their dividends over the past 10 years – which is a great filter in my view. There are many defensive companies here, ranging from the utilities sector to energy, REITs and 'sin stocks'.

WDIV has a trailing dividend yield of 6.33%, which isn't bad at all and will provide a solid stream of passive income. Such diversity can do wonders for an ASX-dominated dividend portfolio in my view and as such, I think this ETF is one that any income investors should consider.

iShares S&P/ASX 20 ETF (ASX: ILC)

This ETF from BlackRock is very simple – it simply holds the top 20 companies on the ASX. CSL Limited (ASX: CSL) is, of course, the top holding, followed by the big 4 banks, BHP and Woolworths Group Ltd (ASX: WOW).

So why this ETF over VHY? Well, it's a more conservative choice in that it is defined by holding the largest companies on the ASX – all of which pay dividends. It is a little concentrated in the banking and resources sectors, but the largest holding, CSL, is a notable exception. ILC boasts a trailing dividend yield of 5.52%, which also comes with some franking credits.

The post Forget the ASX banks! Here are 3 ETFs I would buy for income instead appeared first on The Motley Fool Australia.

In hindsight, I think 2020 will be remembered as the year of 'lost dividends' on the ASX.

Normally, most ASX blue-chip companies reward their shareholders with dividend payments periodically. But since most companies' earnings are likely to take a very nasty hit in 2020, I unfortunately think many of these payments will be either materially reduced or eliminated.

But conversely, I think a select group of ASX shares will continue to be in a position to fund strong dividends in 2020 and beyond. Here are three.

WAM Research Limited (ASX: WAX)

WAM Research is a listed investment company (LIC) that has a long history of funding large dividend payments for its investors. One significant advantage of the LIC structure is the ability to 'hoard' profits in a reserve for a rainy day. WAM Research has done just that and currently has a profit reserve of 25.2 cents per share (excluding April's final dividend of 4.9 cents per share).

As you can see, there is plenty of gas in the tank for dividend payments to continue for some time, even if the stock market doesn't do much for a year or two. And the cherry on top? A 4.9 cent per share dividend equates to a grossed-up yield of 12.05%.

SPDR S&P Global Dividend Fund (ASX: WDIV)

This exchange-traded fund tracks a basket of international dividend-paying shares that have either increased or held steady dividends for at least 10 years. For this reason, I think WDIV is a solid choice for income in today's market. Most of WDIV's holdings are in highly inelastic industries like utilities and 'sin' stocks – which means that their earnings should be relatively stable in this tough time. And that should translate into sturdy dividend payments.

On current prices, WDVI's trailing annual payouts equate to a dividend yield of 6.7%.

Coles Group Ltd (ASX: COL)

Coles is a company most Aussies would be familiar with, especially during this coronavirus crisis. Whilst I don't enjoy seeing what has happened with food shortages in our supermarkets, there's no denying is isn't hurting Coles as a business. Therefore, I think Coles is one of the best ASX dividend shares to buy in 2020. You couldn't ask for a more defensive share in today's market in my opinion.

On current prices, Coles shares are offering a grossed-up yield of 3.69% as well, which I think is still appealing in this near-zero interest rate environment.

The post 3 top ASX shares with strong dividend prospects in 2020 appeared first on The Motley Fool Australia.

It's a tough time for all ASX investors right now. Chances are that if you have a portfolio of ASX shares, it's in the red as we speak. It can be very disheartening thinking about how much better your cash would have been in the bank rather than the markets today – believe me, I know!

But fortunately, or unfortunately, that's what investing is all about. None of us could have predicted what has happened. Rewind to January and it seemed as though we were on track for another bumper year of ASX gains. We have to take the good with the bad when it comes to shares – there's no alternative.

So right now, with the S&P/ASX 200 Index (ASX: XJO) having lost around 30% of its value since mid-February and firmly in bear market territory, I think it's an important time to be brave.

Be brave in resisting the urge to 'cut your losses' and just get out of the market (it's normal to feel this way, no matter how irrational).

Be brave in putting your money into a highly volatile market that no one knows where it will be next week, let alone next month or next year.

I myself have tried to follow this path. I've topped up on some of my favourite ASX shares in recent weeks, including WAM Global Ltd (ASX: WGB), MFF Capital Investments Ltd (ASX: MFF), Pact Group Holdings Ltd (ASX: PGH) and Washington H. Soul Pattinson & Co. Ltd (ASX: SOL).

I've even opened up some new positions, including in Ramsay Health Care Limited (ASX: RHC) and WAM Research Limited (ASX: WAX), as well as also dabbling in some quality ETFs that have lost a lot of value, like the SPDR S&P Global Dividend Fund (ASX: WDIV).

I even picked up some Uber Technologies Inc (NASDAQ: UBER) shares.

But it wasn't easy doing this. I was scared that the shares would fall significantly further than my purchase price (which many have). I was scared that some of these companies might be affected by the coronavirus in ways that I didn't yet know (which they still might be). But there are always fears and doubts swirling in this kind of market. And there is no flashing signal that marks the best time to buy shares.

At the bottom of the GFC market crash in early 2009, there were newspaper headlines warning of a Dow Jones Industrial Average of 5,000 (it bottomed at around 7,000).

As the old saying goes, it's always darkest before the dawn.

And when the dawn comes, it's too late to be brave!

The post The importance of being brave in this ASX bear market appeared first on The Motley Fool Australia.

Receiving ASX dividend income is one of the great underappreciated joys of investing in the share market. Getting paid just to hold shares is one of the greatest forms of passive income – and one that can also boost your long-term returns if the money is dutifully reinvested.

So saying this, here are three ASX dividend shares I would buy for strong income today.

Commonwealth Bank of Australia (ASX: CBA)

CommBank shares have today broken through the $90 per share mark. The ASX's largest bank exceeded expectations with its half-yearly profit report this week and the market has responded in due course.

Still, I think CBA shares are still a solid income buy today with a 4.78% starting yield (6.83% grossed-up). That's a heck of a lot more than you can get from a CommBank term deposit these days, so I would be very happy to have CBA shares in an income portfolio today.

Sydney Airport Holdings Pty Ltd (ASX: SYD)

Another great stock to own for income (in my opinion) is Sydney Airport. This company has a virtual monopoly on air transport in NSW and Sydney, the latter being the premier tourist destination for international travellers. This enables the company to produce rent-like returns for its shareholders, which in turn has translated into a steady stream of rising dividends over the past few years.

Sydney Airport shares have also recently come off all-time highs, which means that today might be a good long-term buying opportunity. With a trailing dividend yield of 4.57%, Sydney Airport is another top buy for income today, in my view.

SPDR S&P Global Dividend Fund (ASX: WDIV)

A final option here is this exchange traded fund (ETF). WDIV holds a basket of shares mostly outside the ASX that focuses on companies with a long track record of paying rising dividends. I think having this kind of ex-Australian income in your dividend portfolio is a great idea from a diversification standpoint.

This ETF holds shares as diverse as Nokian Tyres, Macy's, Enagas and Occidental Petroleum, but also some ASX names like Bendigo and Adelaide Bank Ltd (ASX: BEN).

The S&P Global Dividend fund has a trailing yield of 5.25% – making it a perfect addition to this list, in my opinion.

Foolish takeaway

I think these three high-yielding ASX shares would be fantastic inclusions for an income-focused ASX portfolio today.  The combination of all three offers some nice diversification in my view, and should produce a healthy stream of income for years into the future.

The post 3 ASX dividend shares with solid income yields today appeared first on The Motley Fool Australia.

Dividends are a type of passive income that increase investment returns. Dividends can be reinvested to grow the overall portfolio or utilised by shareholders to meet lifestyle needs. Here we take a look at ETFs designed for the dividend seeking investor.

Paid to shareholders out of the profits of the company, dividends are one of two types of return a shareholder can receive. The other, capital gains, occurs when shares prices increase. Capital gains are only realised when shares are sold and can disappear if share prices fall.

Diversification and dividends

When seeking a reliable and stable source of income via dividends, it is important to consider diversification. Any one company or industry could have a difficult period that could cause it to have to cut dividends. Other companies or industries may experience particularly favourable conditions that could result in higher than anticipated returns to shareholders.

By holding multiple shares across different industries and sectors investors are less exposed to volatility of returns. This is because the returns on each share are imperfectly correlated. This can be expanded beyond the ASX to international shares and different asset classes.

Many investors use ETFs as a quick and easy way to provide "instant" diversification. ETFs are traded on the ASX like ordinary shares and provide exposure to baskets of underlying securities.

Dividend ETFs

The iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD) provides exposure to 50 ASX-listed stocks that offer high dividend yields while also meeting stability, tradeability, and diversification requirements. The ETF returned 16.47% in the year to 31 October and has a 12-month trailing yield of 6.59%.

Management fees are 0.30% and distributions are made quarterly. Top holdings include Wesfarmers Ltd (ASX: WES) (10.62%), Westpac Banking Corp (ASX: WBC) (10.42%), Commonwealth Bank of Australia (ASX: CBA) (9.88%), Woodside Petroleum Limited (ASX: WPL) (9.84%), Rio Tinto Limited (ASX: RIO) (9.02%), and BHP Group Ltd (ASX: BHP) (8.94%).

The SPDR S&P Global Dividend Fund (ASX: WDIV) seeks to track the performance of the S&P Global Dividend Aristocrats AUD Index. The fund made returns of 15.65% in the year to 31 October and had a dividend yield of 4.79%.

Management fees are 0.5% and distributions are made twice yearly. The ETF held 99 stocks at 31 October. Holdings were spread across Canada (21.96%), United States (21.58%), United Kingdom (14.02%), France (7.29%), Japan (7.14%), and Switzerland (4.40%), amongst others.

Top holdings include Hennes & Mauritz AB-B SHS (2.00%), AT&T Inc (1.66%), Klepierre (1.57%), IGM Financial Inc (1.54%), IG Group Holdings PLC (1.53%), and Compass Minerals International (1.50%).

Foolish Takeaway

ETFs provide a quick and easy method of diversifying your portfolio. Reducing the concentration of holdings can reduce the volatility of portfolio returns. These ETFs have been designed to provide a diversified source of dividend returns to investors.

The post ASX ETFs diversified for dividends appeared first on The Motley Fool Australia.

One of the main reasons to invest in shares is for the dividends they can pay. Shares represent part ownership in a company, so shareholders have a right to a share of company profits. But what happens when a company has a bad year? Well, dividends can be cut, reducing shareholder income. 

Dividend diversification

Shareholders can reduce the impact of a bad year for an individual company on their portfolio by allocating funds across a range of companies across different sectors and industries. This is known as diversification, and serves to reduce the risk of the overall portfolio. After all, it is less likely that 20 streams of income will be cut off than one. 

Exchange traded funds (ETFs) offer a viable shortcut to this process by themselves holding a basket of securities. Investors can trade the ETF on the ASX like any other share, and in doing so gain exposure to the securities held by the ETF.  

High Yield ETFs

For yield-seeking investors, there are a number of specialised ETFs that exist to cater to this preference. Here's a closer look at 2 such shares.

The iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD) provides exposure to 50 ASX-listed stocks that offer high dividend yields while also meeting stability, tradeability, and diversification requirements. The ETF returned 16.47% in the year to 31 October and has a 12-month trailing yield of 6.59%.

Management fees are 0.30% and distributions are made quarterly. Top holdings include Wesfarmers Ltd (ASX: WES) (10.62%), Westpac Banking Corp (ASX: WBC) (10.42%), Commonwealth Bank of Australia (ASX: CBA) (9.88%), Woodside Petroleum Limited (ASX: WPL) (9.84%), Rio Tinto Limited (ASX: RIO) (9.02%), and BHP Group Ltd (ASX: BHP) (8.94%). 

The SPDR S&P Global Dividend Fund (ASX: WDIV) seeks to track the performance of the S&P Global Dividend Aristocrats AUD Index. The fund made returns of 15.65% in the year to 31 October and had a dividend yield of 4.79%. 

Management fees are 0.5% and distributions are made twice yearly. The ETF held 99 stocks at 31 October. Holdings were spread across Canada (21.96%), United States (21.58%), United Kingdom (14.02%), France (7.29%), Japan (7.14%), and Switzerland (4.40%), amongst others. 

Top holdings include Hennes & Mauritz AB-B SHS (2.00%), AT&T Inc (1.66%), Klepierre (1.57%), IGM Financial Inc (1.54%), IG Group Holdings PLC (1.53%), and Compass Minerals International (1.50%). 

Foolish takeaway

Dividend-seeking investors have multiple options in the hunt for yield. ETFs are a convenient option for rapid diversification (both local and international). Investors can gain access to dozens of high-yielding shares in a single trade, opening the door to new investment opportunities. 

The post 2 ASX ETFs for dividend-seeking investors appeared first on The Motley Fool Australia.

ETFs (exchange traded funds) aren't normally on the top of most dividend investor's watchlists.

Perhaps because of their relatively new presence on the investing scene, ETFs seem to be viewed with a little more suspicion by income-focused investors than say your classic ASX dividend powerhouses like Commonwealth Bank of Australia (ASX: CBA) or Sydney Airport Holdings Pty Ltd (ASX: SYD).

However, I think dividend-focused ETFs can be a valuable tool in any dividend portfolio. Instant diversification with baskets of dozens of dividend paying companies as well as some international exposure are just some of the benefits ETFs offer.

So here are 3 dividend-focused ETFs that might interest anyone with a bias toward share market income.

SPDR S&P Global Dividend Fund (ASX: WDIV)

This ETF follows dividend paying companies mostly outside Australia that have a track record of stable or increasing dividends over the past ten years. You are getting a mixed bag of companies here, from banks and real estate to consumer stapes and utilities. Our own AGL Energy Ltd (ASX: AGL) is in the mix, but some of WDIV's top holdings include AT&T, IG Group Holdings and Philip Morris International. This ETF is currently offering a 4.78% trailing dividend yield.

Vanguard Australian Property ETF (ASX: VAP)

A little closer to home, this ETF from Vanguard aims to track the largest Australian REITs (real estate investment trusts) on the ASX. Property has always been a lucrative source of investment income, and this ETF provides it through a listed stock investment. VAP holds companies like Goodman Group (ASX: GMG), Scentre Group (ASX: SCG) and Stockland Corporation Ltd (ASX: SGP). These REITs all own property assets like shopping centres, business parks and retirement villages and pass on their rental income as dividends. VAP is currently offering a trailing dividend yield of 4.36%.

iShares Consumer Staples ETF (ASX: IXI)

This ETF doesn't have a primary focus on dividends, but instead aims to track an index comprised of global consumer staples companies (most of which pay decent dividends anyway). These businesses make everyday essentials like food and household items – offering a base of defensive stocks that should be fairly recession-resistant. Some of IXI's top holdings include Proctor & Gamble, Nestle, Coca-Cola and Walmart. IXI is currently offering a 2.04% trailing yield.

Foolish takeaway

I think these 3 ETFs have a lot to offer any investor that has dividend income at the top of their investing priorities. Each ETF offers exposure to dozens of underlying companies (some from around the world), which helps reduce portfolio risk whilst maintaining a decent dividend output.

The post 3 top ETFs to buy for ASX dividend income appeared first on The Motley Fool Australia.

In my experience, most dividend investors that buy shares for income aren't heavy in exchange traded funds (ETFs). ETFs are a relatively new concept on the ASX, so perhaps haven't made their way onto some older dividend investors or retirees' horizons. Or perhaps income investors are just more traditionalist. But I think there is a place for ETFs in every dividend investors portfolio, and I'll explain why using these 2 ASX ETFs.

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

This ETF from BlackRock tracks an index comprised of 51 of the highest-yielding shares on the ASX. Why bother trying to sift through the big banks and resource companies looking for yield when you can just get one ETF that owns all of the best dividend payers the ASX has to offer?

What I like most about this fund is the automatic rebalancing nature of its operations. If a stock ceases to pay a dividend (take AMP Limited (ASX: AMP) for instance), it is automatically removed from the ETF without you having to do anything and replaced with a stock that does. Thus, there is little chance of you getting caught in a dividend trap. IHD charges a management fee of 0.4% and offers a trailing yield of 6.23%

SPDR S&P Global Dividend Fund (ASX: WDIV)

WDIV takes a similar strategy to IHD and applies it to companies around the world – thus you can get a slice of 99 global companies that all have a history of stable or increasing high dividends for 10 years or more, all in one ASX share. Although (as it invests in companies outside Australia) you don't get any franking credits with this ETF, it still offers a 4.8% yield on current prices, as well as valuable global exposure. The ASX only accounts for around 2% of the world's shares, so if you love income, it might pay to look outside our shores as well.

Some of WDIV's top holdings include Exxon Mobil, Japan Tobacco, AT&T and General Mills. This ETF charges a management fee of 0.5%.

Foolish takeaway

I think these 2 ETFs would have a very solid place within any dividend-focused ASX portfolio. You get instant diversification as well as automatic mechanisms that exclude underperforming companies. You could use either or both of these ETFs to build a strong foundation of income-producing assets, topped up with your favourite ASX dividend shares.

The post 2 ASX ETFs to buy for a high-income portfolio appeared first on The Motley Fool Australia.

One of the best things about investing in shares (particularly ASX shares) is the ability to receive dividends. Dividends are one of the best forms of passive income, as they hit your bank account every six months without you having to lift a finger.

So here's how I would build a passive dividend income portfolio today using a $100,000 lump sum.

SPDR MSCI Australia Select High Dividend Yield Fund (ASX: SYI) – $40,000

SYI is an exchange traded fund that only selects the highest yielding ASX shares (42 at the latest count). Rather than debating which bank or resource giant has the best dividend, this ETF boasts the full range and forms a great backbone for our portfolio. SYI has a trailing yield of 6.1% and comes 87.6% franked, so you get a grossed-up yield of 7.3% with the credits. It's heavy with the 'Big Four' banks but also has Sydney Airport Holdings Pty Ltd (ASX: SYD and Wesfarmers Ltd (ASX: WES).

SPDR S&P Global Dividend Fund (ASX: WDIV) – $30,000

Another ETF, WDIV focuses on global companies that have had stable or increasing dividends for 10 years or more. Like with any portfolio, I believe it is important to get some international exposure and what better way than with companies of this calibre. WDIV contains companies that range from American and Canadian to British and Japanese – so you are really getting some diversity here. Some of WDIV's top holdings include AT&T, Laurentian Bank of Canada and Philip Morris International. This ETF has a trailing yield of 4.92% but alas, no franking credits with this one.

Washington H. Soul Pattinson & Co. Ltd (ASX: SOL) – $20,000

On the surface, Soul Patts' current dividend yield of 2.73% doesn't seem that special. But if I told you that Soul Patts has increased said dividend every year since 2000, hopefully, it changes your perspective! Dividend growth is just as (if not more) important than a high starting yield, so this ASX investment company makes a fine addition to our portfolio.

Transurban Group (ASX: TCL) – $10,000

When it comes to dividends, most investors think that they don't come more defensive than toll-road king Transurban. With a monopolistic hold on tolled motorways in Sydney and Melbourne and other cities, Transurban can boast infrastructure vital to Australia's economic prosperity. With such a strong dividend, investors have flocked into TCL shares this year and bid the price way into the stratosphere – hence we are only going to throw 10% of our portfolio into Transurban. But with its 3.9% yield, it remains a formidable income stock.

Foolish Takeaway

With this collection of income-producing assets, I am confident we have a robust, future-proof portfolio capable of throwing out a healthy stream of passive cashflow. One of the best things about shares are dividends. Investing is lots of fun, but when you're getting paid to do it? That might just be the dream.

The post How I would build a $100,000 ASX passive income portfolio appeared first on The Motley Fool Australia.

Income and dividend investing is all the rage at the moment. With interest rates at record lows and tipped to get lower still, yield hungry investors have been flooding into income producing assets on the ASX in record numbers. Stocks with big dividends have seen renewed affection over the last few months. But as good as this is now, we have to keep one eye on the horizon.

We are entering an unprecedented bull run in stocks, with no big crashes for over 10 years now – which is well above the historical pattern. It would, therefore, be prudent to think about how your dividend payers are going to perform if a crash does happen in the medium term.

Here are 2 ASX dividend picks that, in my opinion, you can count on for crash-proof income.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is ASX royalty – founded in 1914, this conglomerate owns many businesses across many industries in Australia – including Bunnings, Kmart, Target and Kleenheat Gas. It also owns chemical and fertiliser manufacturing businesses, coal mines and a clothing line. Wesfarmers has been in the news most recently over its failed bid for Lynas Corporation Ltd (ASX: LYC) and before that, its spinoff of Coles Group Ltd (ASX: COL). With such a diversified portfolio of businesses, I am very confident of Wesfarmers' ability to maintain earnings in the event of a crash, Wesfarmers is currently yielding a 5.51% dividend on current prices (not factoring in its special dividend paid in February).

SPDR S&P Global Dividend Fund (ASX: WDIV)

WDIV is an ETF operated by the SPDR group (behind the famous SPY ETF over in the US). WDIV tracks an index comprised of dividend-paying companies from around the world that have maintained or increased their dividend for at least ten years, so it's nice to have that kind of certainty in an income investment. Some of WDIV's top holdings include AT&T, Laurentian Bank of Canada and Philip Morris International. WDIV has a management fee of 0.5% and currently yields 4.89%.

Foolish Takeaway

If you're a dividend investor, it would be prudent (in my opinion) to think about what may lie around the corner in terms of the global economy and make sure that at least a chunk of your portfolio is built around companies that have a solid track record of dividend growth and solid earnings. Both of these picks demonstrate these qualities in my view and would be worth considering for your income portfolio.

The post 2 crash-proof ASX dividend shares for your income portfolio appeared first on The Motley Fool Australia.

With interest rate cuts starting to flow through into our mortgages and bank accounts, it's an important time to take a refreshing look at your income-producing assets. The S&P/ASX 200 (INDEXASX: XJO) index is already up nearly 4% since the June rate decision was announced and stock prices are likely to be further inflated by the low-rate environment (at least in the short-term), so now might be the time to readjust and rebalance your dividend paying shares.

Here are three ASX dividend shares to have a look at for your portfolio:

National Australia Bank Ltd. (ASX: NAB)

This banking behemoth has recently cut its dividend from 99 cents per share to 86 cents. Despite this, NAB shares are currently yielding 9.75% grossed-up, which is the largest dividend of the 'Big Four' banks and one of the biggest yields you can get on the ASX. While I would not expect wild capital growth or even a dividend increase anytime soon, its still a lot better than a NAB term deposit.

Ramsay Health Care (ASX: RHC)

Ramsay Health Care is the $14 billion company behind some of the biggest and most popular private hospitals in the country. It has built a solid reputation on providing high quality services at good prices. It manages this by wielding its size and scale in negotiations with private health insurers and other suppliers to maintain a low cost basis. Although Ramsay is only yielding 2.05% on current prices, it is well positioned to harness the strong tailwinds of the healthcare sector for decades to come and has an ambitious international expansion program. I look at Ramsay as a great dividend-growth stock to buy and hold.

SPDR S&P Global Dividend Fund (ASX: WDIV)

This exchange-traded fund (ETF) is well worth a look if you're an income investor. Run by the reputable SPDR group, WDIV seeks to track an index of global companies that have had stable or increasing dividends every year for the last 10 years (known as 'dividend aristocrats'). It is weighted 22% to Canadian companies, 21% to US companies and 15% to UK companies, with 15 other countries (including Australia) making up the remainder, giving great income diversity in one stock (in my opinion). WDIV is currently yielding 4.92% and has a management expense ratio of 0.5%.

Foolish takeaway

All of these options are a great shares to incorporate into an income-producing portfolio. My favourite would be WDIV – in my opinion a fantastic and diversified core ETF to build a dividend portfolio around.

The post Why I'd buy these 3 ASX dividend shares for income appeared first on The Motley Fool Australia.