The Australian age pension is currently $29,874 per year for singles and $45,037.20 combined for couples.
That includes the maximum basic rate of pension, the maximum pension supplement, and the energy supplement.
We set out to discover how much money you'd need to have invested in ASX shares to earn more from dividends than the pension.
Could ASX dividends pay more than the pension?
Well, that depends on how much money you have invested by retirement.
Generally speaking, the benchmark S&P/ASX 200 Index (ASX: XJO) delivers an average annual dividend yield of 4%.
That means singles would need about $750,000 invested in ASX 200 shares to receive more than the pension each year.
A 4% annual dividend yield on a $750,000 investment is $30,000.
A couple would need about $1.126 million invested in ASX 200 shares to get more than the pension each year.
A 4% annual dividend yield on a $1.126 million investment is $45,040.
However, there are many ASX dividend shares likely to pay more than a 4% annual yield in 2025.
Based on CommSec forecasts, we reveal 3 ASX dividend shares set to pay much heftier dividend yields than 4%.
Investing in these stocks would require less money to yield the equivalent of the pension in dividends every year.
3 ASX dividend shares providing higher returns than the pension
We took a look at the CommSec dividend forecasts for a range of ASX 200 blue-chip stocks.
We focused on blue chips because research shows that older Australian investors tend to favour larger, more established companies.
Here are three ASX dividend shares that would pay more than the age pension via dividends if you had enough capital invested.
By the way, we're not recommending you buy these ASX stocks. They are merely case studies for comparing dividends to the pension.
But we'll tell you what the current consensus rating is among the professional analysts covering these stocks on the CommSec platform.
Woodside Energy Group Ltd (ASX: WDS)
Woodside is a global oil and gas explorer and the largest energy stock in the ASX 200.
CommSec forecasts Woodside shares will pay an annual dividend of $1.206 per share in 2025.
The Woodside share price closed at $22.25 yesterday, down 2.11%.
Based on this price, the forecast dividend amount represents a 5.42% yield.
If we factor in the 100% franking that comes with Woodside dividends, the gross forecast dividend yield is 7.74%.
That means single investors would need $386,000 invested to receive $29,876 in dividends per year vs. the $29,874 pension.
Couples would need $582,000 invested in Woodside shares to receive $45,046 in dividends vs. the $45,037 pension.
The consensus rating among 16 analysts on CommSec is a moderate buy.
ANZ Group Holdings Ltd (ASX: ANZ)
ANZ is one of Australia's big four banks and the fourth largest financial share in the ASX 200.
CommSec predicts that ANZ shares will pay an annual dividend of $1.66 per share in 2025.
The ANZ share price closed at $29.04 yesterday, up 0.41%.
Based on this price, the forecast dividend represents a 5.72% yield.
Franking on ANZ dividends has bounced around in recent years.
If we assume 70% franking for 2025, the gross forecast dividend yield is 7.44%.
That means single investors would need about $402,000 invested to receive $29,908 in dividends per year vs. the $29,874 pension.
Couples would need $605,500 invested in ANZ shares to receive $45,049 in dividends vs. the $45,037 pension.
The consensus rating among 15 analysts on CommSec is a hold.
Fortescue Ltd (ASX: FMG)
Fortescue is one of the world's biggest miners. It is the second-largest mining stock in the ASX 200.
CommSec forecasts that Fortescue shares will pay an annual dividend of 99 cents per share in 2025.
The Fortescue share price closed at $15.39 yesterday, down 1.85%.
Based on this price, the forecast dividend represents a 6.43% yield.
Fortescue dividends come with 100% franking, so the gross forecast dividend yield is 9.19%.
That means singles would need $325,500 invested to receive $29,913 in dividends per year vs. the $29,874 pension.
Couples would need $490,500 invested in Fortescue shares to receive $45,076 in dividends vs. the $45,037 pension.
The consensus rating among 17 analysts on CommSec is a hold.
When will the age pension go up?
The age pension payment is indexed to inflation twice per year.
As we reported, the last indexation increase occurred on 20 March.
On the same day, the upper limits for the income test and asset test for a part pension also increased.
These tests determine whether you can receive a pension, and if so, how much you will receive.
The less you earn and own, the more likely you are to receive the full payment.
If you earn or own too much for the full payment, a sliding scale determines whether you can get a part pension.
The next lot of changes to the age pension will occur on 1 July.
That's when the lower thresholds for the income and assets tests will be adjusted.
On 20 September, the pension payment itself will change once again, in line with inflation.
Are you eligible to receive a pension?
Australians become eligible for the age pension when they reach 'retirement age'.
This is defined as 67 years of age for people born on or after 1 January 1957.
There are other eligibility criteria, including residency rules.
Last week we reported that the Federal Government is warning retirees about a campaign of Centrelink age pension misinformation.
