S&P/ASX 200 Index (ASX: XJO) shares for passive income?
You bet!
Not all ASX 200 shares pay dividends. But there are a large number of blue-chip companies to choose from that pay yields well in excess of inflation.
Atop the income they offer, ideally, their share prices will appreciate over time as well.
And as inflation comes down, which it's bound to, the real returns in passive income you receive should go up.
That's assuming the ASX 200 shares you've invested in don't cut their payouts over time.
That's an important risk to bear in mind.
The dividend yields we're discussing are trailing yields based on the past 12 months' payouts. That's backwards looking by definition. The yields these stocks will deliver in the future may be higher or lower than what they've paid out over the past 12 months.
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$50 a week in passive income from ASX 200 shares
With that said, here are three ASX 200 shares that could deliver me $50 per week in passive income. Or a handy $2,600 per year.
As all three pay fully franked dividends, I'll also receive credit for the 30% in taxes the companies have already paid on their profits.
First up, we have ASX 200 coal share New Hope Corp Ltd (ASX: NHC).
On the back of record thermal coal prices in 2022, New Hope's all-time high interim dividend of 40 cents per share was paid out on 5 March. Atop the 56 cents per share final dividend, the coal miner paid out a total of 96 cents per share over the past 12 months.
At the current New Hope share price of $5.91, that works out to a juicy trailing yield of 16.2%. The New Hope share price is up 58% over those 12 months.
The next ASX 200 share I'd target for passive income is Westpac Banking Corp (ASX: WBC).
The big four bank stock paid an interim dividend of 61 cents per share on 24 June and a final dividend of 64 cents per share on 20 December for a total payout of $1.25 per share.
At the current Westpac share price of $22.05, the bank pays a trailing yield of 5.7%. Westpac shares are down 9% over the past year.
Which brings us to the third ASX 200 share I'd look at for my $50 weekly passive income stream, Woodside Energy Group Ltd (ASX: WDS).
Last week, 5 April, Woodside paid out a record-high final dividend of $2.15 per share. Adding in the $1.60 interim dividend, paid on 6 October, and Woodside paid out a total of $3.75 to shareholders over the 12 months.
At the current Woodside share price of $34.48, that equates to a trailing yield of 10.9%. Woodside shares have gained 8% over the full year.
How much do I need to invest for $50 a week in passive income?
Assuming I buy an equal number of each of these three ASX 200 dividend shares, my average fully franked yield comes out to 10.9%.
So, in order to garner a $50 weekly passive income stream ($2,600 per year) I'd need to invest $23,853 and change.
Now that may be a big chunk of cash to invest all in one go.
But that's no problem.
I could always invest in these ASX 200 shares in smaller regular increments and I'll reach my goal in due time.
