Investing in ASX 200 dividend shares can be a good way of earning passive income for extra cash.
National Australia Bank Ltd (ASX: NAB) has a long history of paying dividends to investors.
And the big four bank's dividend increased in 2022 compared to 2020 and 2021.
So how much would I need to invest in NAB shares to generate a $150 monthly income?
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Let's crunch the numbers.
Firstly, a monthly income of $150 would generate an annual passive income of $1800.
National Australia Bank paid a final dividend of 78 cents a share in 2022 and an interim dividend of 73 cents a share.
In total, this means NAB paid $1.51 in total dividends in the 2022 financial year.
To have received $1800, or $150 a month, in passive income, you would need to have owned 1,192 NAB shares.
At Thursday's closing price of $28.13, buying 1,192 NAB shares would cost you $33,530.96.
What next?
Goldman is tipping NAB to increase its dividend in FY23 and pay fully franked dividends of $1.73 in FY 2023.
If this is delivered, you would only need to own 1,040 of NAB shares to receive $1800 in passive income for the year.
This would set you back $29,255.20 — so less than what was required to generate this income in 2022.
NAB delivered an unaudited statutory net profit of $2.05 billion in the first quarter of FY23. Revenue lifted 15%, while the bank's net interest margin jumped 12 basis points to 1.79%.
Share price snapshot
The National Australia Bank share price has risen nearly 15% in the last year.
The bank has a market capitalisation of about $88.3 billion based on the last closing price.
