While some Fools search to find the next hot growth stock like Appen Ltd (ASX: APX), others are looking to build a high-income portfolio to secure their financial future.
If you’re part of the latter group, I’ve got some good news for you.
Here are 3 top ASX dividend stocks that could help you build a $30,000 per year passive income within 10 years. This hypothetical 10-year, 3-company portfolio kicks off with a $50,000 initial investment into each company.
1. Bank of Queensland Ltd (ASX: BOQ)
While the BOQ share price has been struggling in 2019 amid the fallout from the 2018 Financial Services Royal Commission, the Queensland-based bank is still offering a good yield to investors.
The BOQ share price closed the week at $9.11 per share, 4.21% lower than where it started the year, but is currently paying 8.34% per annum to its shareholders.
Despite the obvious caveat that it could change its dividend payout in coming years, a $50,000 investment in BOQ could net you a tidy $4,200 per year in dividends.
By reinvesting these proceeds each year for the next 10 years, you could be sitting on a tidy investment of $112,000 – enough to net you $9,408 per year in income.
2. Air New Zealand Ltd (ASX: AIZ)
The Air New Zealand share price edged higher last week despite a 31% drop in net profit and the New Zealand flag carrier still boasts a market cap of nearly $3 billion.
Critically, Air New Zealand said it will maintain its dividend, which means the company’s annual dividend yield is still sitting at around 8%.
With $50,000 in Air New Zealand in 2019, you could be receiving $3,970 per year, which when compounded over this investment horizon, would result in a $107,000 nest-egg or $8,523 yearly income.
3. Alumina Ltd (ASX: AWC)
The Alumina share price has edged lower in 2019 amid a difficult global pricing environment, but I still think the technicals look solid with supply and demand factors boding well for its future profitability.
Alumina remains a king amongst the ASX dividend stocks, with a current yield of nearly 11% per annum.
Our $50,000 investment in Alumina would net us a tidy $5,470 per year at present, meaning our compounded 10-year holding of $141,205 would bring in around $15,500 per year in passive income.
Our hypothetical 10-year portfolio performance
Without taking into account any capital gains or losses, and assuming our dividend yields were held constant, our 10-year, 3-company portfolio could have grown to $360,205 with a yearly income of around $33,000.
While these assumptions may not hold in the rough and tumble world of ASX investing, it’s easy to see that compound returns can be dividends (literally!) over the medium- to long-term.
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Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.