Superannuation is one of the rare investments designed to be held for decades. That makes Warren Buffett’s approach to investing particularly relevant for Australians building wealth for retirement.

Buffett’s success hasn’t come from constantly trading in and out of stocks. Instead, he has focused on owning high-quality businesses, paying reasonable prices and giving them plenty of time to compound.

Several of those principles can translate surprisingly well to superannuation.

Patience can be a superpower

Perhaps the biggest Buffett lesson is that investing doesn’t have to involve constant activity.

The legendary investor is famous for holding businesses for many years, sometimes decades. That patience allows companies to reinvest profits, grow earnings and compound value without investors repeatedly interrupting the process.

There’s a lesson here for superannuation investors.

Constantly changing investments can create more opportunities to make mistakes, particularly when decisions are driven by fear during market sell-offs or excitement when a stock is soaring.

If the original investment thesis remains intact, there may be little reason to sell simply because another opportunity looks more attractive.

A superannuation timeframe can stretch 20 or 30 years. That gives investors an enormous advantage: time.

Of course, patience only works when paired with sensible investments. Whether it’s carefully selected ASX shares or diversified index ETFs, having a clear strategy and sticking with it can provide a strong foundation.

Think like a business owner

Buffett doesn’t view shares as pieces of paper to trade. He sees them as ownership stakes in real businesses.

That mindset can be particularly useful for investors running a self-managed superannuation fund (SMSF).

Take CSL Ltd (ASX: CSL). Rather than simply asking whether its share price might rise next year, a superannuation investor could consider what makes the biotech company competitive, how durable those advantages are and whether the business can become more valuable over the next decade.

Share prices can fluctuate wildly along the way. But ultimately, long-term returns are driven by the performance of the underlying businesses.

That means investors should consider factors such as competitive advantages, management quality, financial strength and opportunities for future growth.

Quality matters more than simply being cheap

Buffett’s investing style has also evolved towards owning exceptional businesses rather than simply buying statistically cheap stocks.

That distinction matters for superannuation investors. A company with a strong competitive position, capable management and plenty of opportunities to reinvest capital may be able to compound its value for many years.

That doesn’t mean price is irrelevant. Buffett remains highly conscious of valuation.

But a slightly more expensive high-quality business can potentially prove a better long-term investment than a struggling company that initially looks cheap.

Keep it simple

There’s another Buffett lesson that may be even more relevant to most superannuation investors: you don’t need to pick individual winners.

Despite his extraordinary record as a stock picker, Buffett has repeatedly acknowledged the value of low-cost index investing for people who don’t have the time or expertise to analyse individual businesses.

For Australians, ETFs such as the Vanguard Australian Shares Index ETF (ASX: VAS) or iShares S&P 500 ETF (ASX: IVV) offer straightforward ways to own diversified portfolios.

For super investors, perhaps the biggest Buffett lesson is therefore simple: invest sensibly, keep costs under control, think like an owner and give compounding time to work.

The post What Warren Buffett can teach Australians about superannuation appeared first on The Motley Fool Australia.

More reading

• Higher or lower: Where are CSL shares going next?
• How much do I need to invest in ASX shares to retire with an extra $1 million on top of my superannuation?
• ASX healthcare shares are 39% higher since June. Are you missing out?
• CSL shares are up 90%. Brokers can’t agree what happens next
• Payday superannuation is two months old. Has it made you better off?

Motley Fool contributor Marc Van Dinther has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and iShares S&P 500 ETF. The Motley Fool Australia has recommended CSL and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Westpac Banking Corp (ASX: WBC) shares are among the most popular ASX dividend options because of the company’s reputation as an ASX dividend share with a pleasing dividend yield.

The ASX bank share usually has a higher dividend yield than Commonwealth Bank of Australia (ASX: CBA), though the yield is typically similar to National Australia Bank Ltd (ASX: NAB) and ANZ Group Holdings Ltd (ASX: ANZ).

If an investor is searching for passive income, then investors may like the idea of Westpac shares over Commonwealth Bank.

Westpac has increased its annual payout each year since the COVID-impacted year of 2020, so it’s pleasing to see the business has delivered regular payout growth for investors.

The FY26 half-year result was a good demonstration of the company’s commitment to regularly paying a good dividend. Statutory net profit rose 3% year-over-year to $3.4 billion and underlying net profit rose 1% year-over-year to $3.5 billion. That profit generation helped Westpac hike its interim dividend by 1.3% to 77 cents per share.

However, in this article, we’re not thinking about FY26’s payments, we’re going to look at the FY27 annual dividend, which will be paid in 2027.

2027 dividend projection for owners of Westpac shares

According to the projection on CMC Invest, the ASX bank share is projected to pay an annual dividend per share of $1.585, which could equate to a possible 2.25% rise year-over-year.

At the time of writing, that forecast translates into a dividend yield of 4.6% excluding franking credits and 6.5% including franking credits.

If someone were to invest $15,000 in Westpac, they would be able to buy 433 Westpac shares (with a little bit of money left over).

With those 433 Westpac shares, investors could receive $686.30 of passive income cash and $980.44 overall, including the franking credits.

Is this a good time to invest in the ASX bank share?

According to CMC Invest, there have been eight analyst rating calls on the business within the last three months.

Of those eight ratings, five were a sell rating, two were a hold rating and one buy rating was a buy. Therefore, investment professionals are, on average, negative on the appeal of the company’s valuation right now.

The average price target of those eight ratings is $33.94. That means, collectively, those analysts are predicting the Westpac share price could fall by 2% (at the time of writing) within the next year. The Westpac share price has drifted slower since April 2026, so we’ll see what happens next.

For now, there seem to be better ASX shares out there that Australians can buy.

The post If I invest $15,000 in Westpac shares, how much passive income will I receive in 2027? appeared first on The Motley Fool Australia.

More reading

• How much superannuation do I need to earn $80,000 per year in passive income?
• 2 ASX shares I think could return more than Westpac
• Is the pullback in Westpac shares a buying opportunity?
• How much superannuation do I need to earn $100 a day in passive income?
• $10,000 invested in Westpac and NAB shares 3 years ago is now worth…

Motley Fool contributor Tristan Harrison 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.

Looking to earn an extra $10,000 a year in passive income by buying quality S&P/ASX 200 Index (ASX: XJO) dividend shares?

We’ll look at two ASX dividend gems below that I think belong in every income investor’s portfolio.

But first, some important reminders.

Diversity and trailing yields

While we’ll look at two quality ASX 200 dividend stocks below, a properly diversified passive income portfolio will contain a lot more than just two stocks. Though there’s no correct number for everyone, around 15 or so is a decent target.

Ideally these companies will operate in various sectors and locations. This will reduce the risk of your income stream taking an outsized hit if any one company or sector runs into headwinds.

Also, bear in mind that the yields you generally see are trailing yields. Future yields may be higher or lower depending on a range of company specific and macroeconomic factors.

Which brings us to…

Two ASX dividend gems for a $10,000 annual passive income

The first ASX dividend gem you may want to buy for passive income is Woodside Energy Group Ltd (ASX: WDS).

Recently trading for $33.00 a share, the ASX 200 oil and gas stock has gained 33% over the past year.

As for that income, Woodside paid (or shortly will pay) $1.63 a share in fully franked dividends over the past year. The stock traded ex-dividend on 3 September. Eligible stockholders can expect to receive that payout on 25 September.

At the recent share price, then, Woodside shares trade on a fully franked 4.9% trailing dividend yield.

The second ASX dividend gem I believe should have a place in every passive income investor’s portfolio is Telstra Group Ltd (ASX: TLS).

Recently trading for $4.76 a share, the ASX 200 telco is down 2.7% over the past 12 months.

On the income front, Telstra has paid (or shortly will pay) two dividends totalling 21 cents a share, franked at 90%. Telstra shares traded ex-dividend on 26 August. Eligible stockholders can expect to receive that payout on 24 September.

At the recent share price Telstra shares trade on a partly franked 4.4% trailing dividend yield.

How much to invest?

Assuming you invest the same amount in each ASX dividend gem, you could expect to earn a yield of 4.7%, based on those trailing yields.

To earn $10,000 a year in passive income, you’d need to invest $212,766 today.

Now, that’s a sizeable amount to invest in one go.

But that’s okay.

Investing is a long game. You can always invest a smaller amount on a regular basis, and you’ll reach your passive income goal in good time.

The post 2 ASX dividend gems I’d buy today for $10,000 a year in passive income appeared first on The Motley Fool Australia.

More reading

• $10,000 invested in Santos and Woodside shares 3 years ago is now worth…
• 5 things to watch on the ASX 200 on Friday
• How much superannuation do I need to earn $80,000 per year in passive income?
• 9 ASX 200 shares earning strengthened buy ratings this week
• How much superannuation do I need to earn $100 a day in passive income?

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 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.