Monthly income from ASX 200 dividend shares is a great way to achieve some extra cash on the side.
Rio Tinto Ltd (ASX: RIO) has been paying dividends to investors for many years. Back in February 2009, the company paid total dividends of $1.015 a year to shareholders.
Let's take a look at how much I would need to invest in Rio Tino shares to generate $100 in passive income.
How many Rio Tinto shares would deliver you $100 a month in dividends?
Firstly, a monthly income of $100 would equate to an annual income of $1200.
Rio is due to pay a fully franked final dividend of $3.2649 to eligible investors on April 20. This follows Rio paying a fully franked interim dividend of $3.8370 in September last year.
This means Rio's total dividends in a year add up to $7.1019, a 5.8% dividend yield based on the company's latest closing share price of $121.84.
In order to have received $1200 in a year of dividend income ($100 per month) from Rio Tinto shares, investors would need to own about 169 Rio Tinto shares (169 multiplied by $7.1019 a share equals just over $1200).
At Rio's last closing share price of $121.84 a share, this would set an investor back $20,590.96.
However, analysts at Goldman are predicting Rio Tinto will pay fully franked dividends of US$5.33 (A$7.91) per share in FY23.
If this eventuates, an investor would need to own 152 shares to achieve about $100 of monthly income from Rio Tinto shares. This would cost an investor $18,519.68
Rio Tinto share price snapshot
The Rio Tinto share price has returned 1.08% in the last year.
This ASX 200 mining share has a market capitalisation of about $45 billion based on the current share price.
