2 ASX passive income ideas I’d use to generate $700 a month in 2027

There are certain ASX passive income shares that I’ll highlight in this article as excellent ideas for dividends to help generate good payments.

Some businesses have already provided guidance for the upcoming financial results that show a good dividend yield based on the appealing expectations.

Below are two of the higher-yielding ideas I like a lot.

Future Generation Global Ltd (ASX: FGG)

This idea is a listed investment company (LIC) which is an excellent source of passive income.

Future Generation Global aims to provide a reliable stream of income, which has regularly increased each year since FY19. For FY26, the business has provided guidance that it will increase its annual dividend per share by 5% to 8.4 cents per share.

That forecast translates into a forward grossed-up dividend yield of 7.3%, including franking credits, at the time of writing. I’m assuming no dividend growth from the ASX passive income share in FY27 for this article, but I do think there’s likely to be a dividend hike in 2027.

It pays for those dividends from the investment returns of its portfolio. It’s invested in a portfolio of 15 funds from fund managers focused on international shares. All of those fund managers work for free so that Future Generation Global can donate 1% of its net assets to charities focused on youth mental health.

There are more than 3,700 underlying shares across different markets and sectors, so it can offer Australians significant diversification.

Dexus Industria REIT (ASX: DXI)

This ASX passive income share is a leading real estate investment trust (REIT), in my view, due to the exposure that the portfolio provides.

It’s invested in a portfolio of industrial real estate across Australian cities. It has a diversified tenant base across the sectors of wholesale trade, construction, manufacturing, retail trade, logistics and more.  

The business says that it has ‘3%+’ embedded rental growth, with approximately 87% linked to fixed rental increases, with “strong inflation protection”. This can help protect and grow rental earnings amid higher interest rates.

With a 99% occupancy rate and a five-year weighted average lease expiry (WALE), the business has strong rental characteristics that can help fund good distributions.

It expects to pay a distribution per unit of 16.6 cents, which translates into a distribution yield of close to 6.9%.

$700 per month from ASX passive income shares

Neither of these ASX passive income shares pays dividends monthly, so we’re going to look at this as an annual goal, which can then be divided into monthly income. Receiving $700 per month is equivalent to $8,400 annually.

Between them, these two names have an average dividend yield of 7.1%. Receiving $8,400 per year at a dividend yield of 7.1% would require a total investment of approximately $118,300.

By investing in these two ASX passive income shares, along with other names for diversification, I think investors can build a solid level of income.

The post 2 ASX passive income ideas I’d use to generate $700 a month in 2027 appeared first on The Motley Fool Australia.

More reading

• 2 ASX dividend shares with yields above 7%
• 3 ASX dividend shares raising dividends like clockwork
• How much is needed in superannuation to target a $2,500 monthly passive income?
• How much do I need to retire on $120,000 a year at 55?
• Future Generation Global earnings: Profit and revenue drop, dividend rises

Motley Fool contributor Tristan Harrison has positions in Future Generation Global. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.