If you want to build up a passive income over the long term, then buying and holding some ASX dividend shares could be the way to do it.
That's because it allows income investors to benefit from the power of compounding to supercharge their returns.
But which ASX dividend shares could be good options right now? Here are a couple of shares to consider:
Coles Group Ltd (ASX: COL)
The first ASX dividend share to look at is Coles.
As well as being one of the big two supermarket operators, it has a significant network of convenience and liquor stores.
All of its operations have defensive qualities and positive long-term growth outlooks, which is exactly what you want from a buy and hold investment.
Citi believes its shares are a buy at the current level. The broker recently put a buy rating and $18.30 price target on them.
As for dividends, the broker is forecasting fully franked dividends per share of 61 cents in FY 2024, 68 cents in FY 2025, and 78 cents in FY 2026. Based on the current Coles share price of $15.60, this represents yields of 3.9%, 4.35%, and 5%, respectively.
Transurban Group (ASX: TCL)
Another ASX dividend share that could be a top buy and hold option is Transurban.
It is one of the world's leading toll road operators with a collection of important roads across several locations. These roads appear well-positioned to benefit from population growth, urbanisation, and inflation-linked price increases.
Citi is also a fan of the company and has a buy rating and a $15.90 price target on its shares.
In respect to income, the broker is forecasting dividends per share of 63 cents in FY 2024, then 65 cents in FY 2024, and 68 cents in FY 2025. Based on the current Transurban share price of $12.45, this will mean yields of 5%, 5.2%, and 5.45%, respectively.