Here’s how much I’d need to invest in Telstra shares to generate a $200 monthly income

A woman smiles widely while using an old fashioned hand set telephone with dial.

A woman smiles widely while using an old fashioned hand set telephone with dial.

The ASX 200 telco Telstra Group Ltd (ASX: TLS) has a long history on the ASX as a source of dividend income. Telstra shares have been a staple holding of anyone seeking income from the share market for decades. That reputation continues today.

Over the past few years, the dividends that Telstra has paid out have been remarkably consistent. Unlike many other ASX 200 blue chip shares, Telstra kept its dividends uncut during the tough years of the pandemic.

Telstra paid out the same level of dividends in 2020 as it did in 2019, and did so again in 2021. And in 2022, investors were treated to the first dividend raise that Telstra has given to its investors since 2016. Shareholders received an 8.5 cents per share final dividend last year.

In 2023 so far, Telstra has upped its dividend game again. An interim dividend of 8.5 cents per share will be coming investors’ way later this month. That represents a 6.25% increase over 2022’s interim dividend of 8 cents per share. It also matched the raised final dividend that investors were treated to in September 2022.

So Telstra is a solid ASX dividned share. But how much would you have to have invested in Telstra shares to get a monthly income of $200? Let’s figure it out.

How many Telstra shares would get you to $200 a month in dividends?

Let’s start with the basics: a monthly income of $200 would translate into an annual income of $2,400.

As we’ve just been through, Telstra shares have paid out a total of 17 cents per share over the past 12 months. So in order to receive a total of $2,400 in dividend income over the past year, investors would have needed to own 14,118 Telstra shares (14,118 multiplied by 17 cents per share equates to just over $2,400 in dividend payments).

At today’s Telstra share price of $4.11 per share (at the time of writing), buying 14,118 shares of Telstra would set an investor back approximately $58,025.

So that’s how much an investor would have to spend today to secure a monthly income of $200 from Telstra. That’s assuming the telco doesn’t cut its dividends going forward, of course.

But if our investor bought that same number of shares a year ago, it would have only cost them $55,060 at a share price of $3.90.

At today’s Telstra share price, this ASX 200 telco has a trailing dividend yield of 4.15%.

The post Here’s how much I’d need to invest in Telstra shares to generate a $200 monthly income appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Telstra Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia

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