Can you imagine earning $50,000 each year for doing nothing? The possibilities are endless!
One way you could potentially achieve this is through investing in ASX shares which pay dividends to their shareholders.
How can you achieve this?
If you're lucky enough to already have a hefty sum of money in your bank account then you're half way there.
You could earn $50,000 in dividends each year from bank shares such as Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) by investing these funds into their shares.
ANZ's shares currently offer a trailing fully franked 6.15% dividend yield. This means you would need to invest approximately $813,000 in the bank's shares in order to earn $50,000 in dividends each year.
NAB's shares currently offer an even more generous trailing fully franked 7.7% dividend, which means an investment of $650,000 would be enough to generate dividends of $50,000 each year.
However, not everyone is lucky enough to have $650,000 sitting in a bank account.
Is there another way?
There is another way to achieve this if you have time on your side.
Ten years ago you could have bought Breville Group Ltd (ASX: BRG) shares for just 60 cents. At present the appliance manufacturer's shares offer a trailing fully franked 35 cents cents per share dividend.
This means that if you had bought Breville's shares ten years ago, you'd have a yield on cost (the dividend yield on the price you paid for the shares) of 58.3%.
This means that an investment of just under $86,000 ten years ago would now yield $50,000 in dividends.
Furthermore, with its shares now trading at a lofty $16.28, the value of your investment would have growth to be worth a staggering $2,333,467 today.
But Breville isn't the only share that would have achieved this. A $62,000 investment in Credit Corp Group Limited (ASX: CCP) shares ten years ago would have yielded $50,000 in dividends this year, as would a $96,000 investment in Flight Centre Travel Group Ltd (ASX: FLT) shares 10 years ago thanks to its latest special dividend.
Whilst very few shares will generate returns of this nature, I believe there are some on the ASX boards at the moment that could prove to be very rewarding investments over the next decade.
