My 3 favourite ASX 200 dividend shares for passive income

S&P/ASX 200 Index (ASX: XJO) shares are a great way for passive-income-seeking investors to earn some extra cash.

Major ASX dividend shares pay shareholders a consistent dividend, usually around twice per year, though sometimes more.

But it’s not always easy to determine which ASX dividend shares are the best to buy.

Here are three of my top picks.

Commonwealth Bank of Australia (ASX: CBA)

When it comes to ASX dividend shares, dominant players like CBA are a great option.

The banking giant is the largest ASX share by market capitalisation. It is a huge, dominant, and highly profitable ASX 200 dividend stock that is able to offer both quality and consistency.

CBA has paid dividends twice per year consistently since 2006. The bank most recently paid its shareholders a fully-franked dividend of $2.35 per share in late March. This implies a dividend yield of around 2.74% at the time of writing.

It’s not one of the highest-yielding players on the sharemarket, but it suits conservative investors who want to prioritise stability and profitability over a high yield. 

BHP Group Ltd (ASX: BHP)

The mining giant is widely considered a premier blue-chip ASX 200 stock with a huge $277 billion market capitalisation and a strong operational history. At the time of writing, BHP is second only to CBA in terms of market size.

BHP is a cyclical, rather than a defensive stock, and while cyclical stocks are closely tied to the broad economic cycle, they usually outperform during periods of economic recovery.

The low-cost miner has a long history of regular dividend payment, which dates back to around 2006. And its commodity exposure is diversified too, which means it can maintain its dividend payouts even when commodity prices fluctuate.

BHP most recently paid its shareholders an interim dividend of $1.0385 per share in March, fully franked, which translates to a dividend yield of around 3.8% at the time of writing.

Telstra Group Ltd (ASX: TLS)

Unlike CBA and BHP, Telstra is a classic defensive stock. Internet access and mobile phone connectivity are basic daily necessities these days, which means the company is likely to perform steadily regardless of the stage of the economic cycle. 

Because of its defensive nature, Telstra can usually pay its shareholders a reliable passive income at a good dividend yield.

The company historically pays its shareholders two dividends every year, in March and September. Most recently, shareholders were paid an interim dividend of 10.5 cents, 90.48% franked, in March. 

The telco is expected to pay a total dividend of 20 cents for FY26, representing a 5.25% year-on-year increase. At the time of writing, that implies a dividend yield around 3.7%.

The post My 3 favourite ASX 200 dividend shares for passive income appeared first on The Motley Fool Australia.

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Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. 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 Australia has recommended BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.