If you’re ready to hang up your hat and enjoy your golden years with a $750,000 superannuation balance, how much passive income could you expect to earn each year?

The answer will, of course, depend on the yield you can earn from those super savings.

Now, in my opinion, investing in the right selection of ASX dividend shares is the best path to achieving a reliable passive income stream in retirement.

And what we’ll look at below is the annual passive income that you can earn from your superannuation without drawing down that $750,000 balance.

We’re also aiming for share price gains and higher annual dividends from those ASX shares over time to at least offset the eroding forces of inflation. This way your real passive income stream remains steady, or ideally increases, over the years as well.

A few important points

While we’ll look at three quality ASX dividend stocks that I believe are a suitable superannuation investment below, a properly diversified passive income portfolio will contain a lot more than just three. There’s no magic number. But 15 or so is a decent ballpark figure.

Ideally these companies will operate in various sectors and locations. This will reduce the risk of your retirement income taking a big hit if any single sector or company runs into headwinds.

Also remember that the yields you generally see quoted are trailing yields Future yields may be higher or lower depending on a range of company specific and macroeconomic factors. Though, as mentioned above, we’ll be aiming to invest in ASX shares that will increase their passive income payouts over the years.

With that said…

Tapping into superannuation for retirement income

Remember, the passive income you earn of your $750,000 superannuation balance will depend on the yield you’re getting.

We’ll take the average yield of the three ASX 200 dividend stocks below as our benchmark.

First up we have Bank of Queensland Ltd (ASX: BOQ).

Over the past 12 months, the ASX 200 bank stock has paid two fully franked dividends and a special dividend totalling 55 cents a share. At the recent Bank of Queensland share price of $6.63, the stock trades on a fully franked trailing yield of 8.3%.

Next, we have ASX 200 rail freight operator Aurizon Holdings Ltd (ASX: AZJ).

Over the past 12 months Aurizon has paid (or shortly will) two dividends totalling 23 cents a share, 90% franked. At the recent Aurizon share price of $3.72, the stock trades on a dividend yield of 6.2%.

And the third stock you might want to invest some of your superannuation into for passive income is Fortescue Ltd (ASX: FMG).

Over the past 12 months, the ASX 200 mining giant has paid (or shortly will) two fully franked dividends totalling $1.08 a share. At the recent Fortescue share price of $17.42, Fortescue shares trade on a fully franked trailing yield of 6.2%.

To the maths!

So, if you invest an equal amount of your superannuation into each of the above ASX 200 dividend stocks, you could expect to earn a yield 6.9%.

Meaning with a $750,000 investment, you could earn $51,750 a year in passive income without drawing down your super balance.

The post How much passive income can I earn off a $750,000 superannuation balance? appeared first on The Motley Fool Australia.

More reading

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• $10,000 a year in passive income buying just $10k worth of ASX shares? Here’s how I’d go about it
• How much do I need in my superannuation to earn $10,000 passive income every month?
• Here are the top 10 ASX 200 shares today
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Motley Fool contributor Bernd Struben 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 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.

BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA) and CSL Ltd (ASX: CSL) are among the largest players on the S&P/ASX 200 Index (ASX: XJO) by market capitalisation.

The trio are major long-standing blue-chip companies and among some of the most dominant businesses on the share market.

So it’s unsurprising that they’re also among the most popular with investors.

Let’s find out the latest update from each of these ASX 200 stocks, and which one brokers prefer.

Sell CBA shares

CBA shares have fallen further this week. At the close of the ASX on Tuesday afternoon, the banking giant’s shares were down around another 2% to $158.69 per share. 

The decline means CBA shares have now dropped around 9% since it posted its FY26 results, and is down around 12% from a high in early-August. For the year-to-date the bank stock is now down roughly 1.5%.

The result was positive overall, but it raised concerns about the bank’s earnings strength and its already-high valuation against a backdrop of a weakening housing market.

Meanwhile, concerns around inflation, interest rates movements, falling mortgage demand, a weakening housing market, and tight competition have all also acted as strong headwinds for the ASX bank shares.

The continued share price decline suggests investor sentiment has finally turned south, and brokers expect more correction ahead.

Market Index data shows all brokers have a strong sell rating on CBA shares. The average $125.10 target price implies a potential downside of around 21% over the next 12 months, at the time of writing.

Hold BHP shares

BHP shares have been in the spotlight this week after news that China’s biggest steelmaker is considering buying into one of BHP’s largest iron ore mines.

China Baowu Steel Group is reportedly looking at taking a 15% to 25% stake in BHP’s Jimblebar operation in the Pilbara.

Australia’s Federal opposition has already objected. The Coalition has said that Labor must not allow foreign entities to buy one of Western Australia’s top iron ore mines.

There hasn’t been much material change in BHP’s share price since the news surfaced. At the close of the ASX on Tuesday afternoon, the ASX mining shares were down around 1% to $62.55 a piece.

BHP shares have enjoyed a strong rally this year, however. For the year-to-date the shares are up around 37%.

But going forward, the experts are reserved about the outlook for BHP shares over the next 12 months. Market Index data shows the majority of brokers have a hold rating, and the $61.78 average target price now implies a potential 1% downside ahead.

Buy CSL shares

CSL shares rebounded strongly in August, and they have continued climbing higher into early September. At the close of the ASX on Tuesday, the shares were up another 1% to $174.80. 

The rebound means the shares are now up around 2% for the year-to-date, officially recouping losses shed earlier this year.

The ASX biotech stock has faced several market and company headwinds over the past 18 months, but it looks like investor sentiment has finally turned more positive. 

ASX healthcare shares came back into favor last month after a significant sell-off. And CSL shares were boosted even higher after it posted an impressive FY26 result in mid-August.

The result came in way ahead of guidance and CSL management described FY26 as a ‘reset year’, with FY27 marking a return to growth.

Analysts also have a more positive outlook following the latest results announcement. Market Index data shows a buy rating on CSL shares. But after the latest rally, the $156.09 average target price now implies a potential 11% downside ahead, at the time of writing. 

The post Buy, hold, sell: BHP, CSL, CBA shares appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• $10,000 invested in BHP and CBA shares three years ago is now worth…
• Rates are rising again. Should you pay down your mortgage or top up your superannuation?
• All 4 big banks now expect a rate hike. What does this mean for ASX bank shares?
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Motley Fool contributor Samantha Menzies has positions in BHP Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has recommended BHP Group and CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Deciding between extra mortgage repayments or extra superannuation contributions has always been a tough decision.

That being said, when mortgage rates sat near 2%, almost any sensible investment in superannuation beat paying down debt.

However, that is no longer the case.

All four major banks now expect the Reserve Bank to lift the cash rate again before the end of the year.

What a rising cash rate does to the mortgage side

The cash rate already sits at 4.35% after three increases in 2026, and the board next meets on 28 and 29 September.

Westpac Banking Corp (ASX: WBC) now expects a rise to 4.60% in November, joining ANZ Group Holdings Ltd (ASX: ANZ) and Commonwealth Bank of Australia (ASX: CBA), while National Australia Bank Ltd (ASX: NAB) is tipping September as the month that rates rise.

The Reserve Bank’s housing lending statistics put the average new owner-occupier variable loan at roughly 6.25%.

That means that every extra dollar that is paid off that loan earns a guaranteed 6.25%, tax free.

There are very few assets Australia that offers that combination.

What the tax system does for superannuation

However, superannuation contributions can be a more tax-efficient way to invest your money.  

Salary sacrificed contributions are taxed at 15% going in, instead of at your marginal rate.

Investment earnings inside the fund are taxed at 15% during accumulation and are not taxed at all in pension phase.

The concessional contributions cap rose to $32,500 from 1 July 2026. That is $2,500 more room than the previous three financial years allowed.

Why the answer is still not obvious

On the flipside, two things can make paying down your debt more attractive.

The first is access.

Money inside superannuation is locked away until preservation age, which is 60 for anyone born after June 1964.

A mortgage repayment made through an offset account can be withdrawn tomorrow.

The second is certainty.

The mortgage return is guaranteed and the investment return is not.

To illustrate, the Vanguard Australian Shares Index ETF (ASX: VAS) is a reasonable proxy for the Australian portion of most balanced superannuation options.

The fund closed Tuesday at $111.50 and has returned just 0.82% over the past twelve months, which is a useful reminder that share markets do not deliver averages on schedule.

How I would think about superannuation versus the mortgage

The soft answer is that it depends on three things.

Your marginal tax rate decides how large the superannuation head start is.

Your age decides how painful the preservation rules are.

And your loan-to-value ratio decides how much you need the security of a smaller debt.

For someone in their fifties on a high marginal rate, superannuation is very hard to beat.

For someone in their thirties with a large mortgage and no buffer, the extra repayment usually wins on peace of mind alone.

Foolish takeaway

There is no universal right answer.

What has changed this year is that the savings from paying down mortgage side have become competitive at 6.25%.

Superannuation still wins on tax over a long enough horizon, and the higher contributions cap makes that easier to use.

I would make sure the emergency buffer exists first, then let the marginal tax rate decide the split.

The worst outcome is doing neither and letting the cash sit in a transaction account earning nothing at all.

The post Rates are rising again. Should you pay down your mortgage or top up your superannuation? appeared first on The Motley Fool Australia.

More reading

• $10,000 invested in BHP and CBA shares three years ago is now worth…
• Buy, hold, sell: BHP, CSL, CBA shares
• How much must I invest in VAS ETF shares to earn a $1,000 passive income in 2027?
• Buy, hold sell: Telstra, Origin Energy & Westpac shares
• All 4 big banks now expect a rate hike. What does this mean for ASX bank shares?

Motley Fool contributor Mark Verhoeven 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 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.