Having an early retirement probably sounds great to most people. I think certain S&P/ASX All Ordinaries Index (ASX: XAO) shares can help people take a large step towards that goal.
One way to try to retire early would be to invest in the best ASX growth shares.
However, another approach could be to choose investments that offer large dividend yields. This means someone would need a smaller portfolio balance to receive the necessary cash flow compared to one with a low dividend yield (which would require a larger balance). For example, you'd need double the size of a portfolio with a 3% dividend yield compared to a 6% dividend yield.
In this article, I'm going to talk about three stocks, but it's important to have a diversified portfolio – more than three names – if you rely on dividend income for life expenses. I think it's just as important to invest in a growing business because a company that cuts its dividend is no use to someone relying on passive income.
So, below are three ASX All Ords shares that could help create an early retirement with a strong dividend yield and further dividend growth in the coming years.
Accent Group Ltd (ASX: AX1)
Accent sells footwear through its own brands, and it also acts as a distributor for global businesses. Some of its own businesses include The Athlete's Foot, Stylerunner, and Platypus, while global brands it works with include Vans, Hoka, Skechers, Herschel, Ugg, Sebago, Saucony, and more.
The ASX All Ords share is working on growing profit in multiple ways, including opening more stores and working with more brands. It's going to expand with Dickies and Lacoste in FY26, while the Frasers' partnership with Sports Direct could be a game-changing opportunity.
According to the forecast on Commsec, Accent is expected to pay a grossed-up dividend yield (including franking credits) of 9.8% in FY26 and 10.1% in FY27. Those are strong yields to help retirement. Its earnings per share (EPS) is projected to grow by 34% in FY26 and another 12.7% in FY27.
Duxton Water Ltd (ASX: D2O)
Duxton Water owns water entitlements, which can be leased to farmers through short-term or long-term contracts. I like this company as a way to gain exposure to Australia's excellent agricultural sector, but with less volatility.
The business has grown its half-year dividend every six months since 2017, which is a great record in my view. The last two declared dividends come to a grossed-up dividend yield of 6.7%, which is a solid starting point for a retirement stock.
I think the ASX All Ord share's lease income could rise in the coming years because of the increasing importance of water access and how Duxton Water can provide that water security.
GQG Partners Inc (ASX: GQG)
GQG is a fund manager based in the US with a global client base. It offers strategies for US shares, non-US international shares, global shares, and emerging market shares.
Pleasingly, a fund manager doesn't require much capital to grow, so it's able to pay a generous dividend and still deliver growth for ASX investors. A key factor for its success is delivering good investment returns for its clients – each of GQG's main funds has outperformed its benchmarks since inception.
Good performance for clients helps grow the ASX All Ords share's FUM organically and encourages clients to allocate additional money to GQG. It's currently seeing more than US$1 billion of net inflows each month. The fund manager hardly charges any performance fees, so FUM growth is an integral factor.
According to estimates from Macquarie, GQG is expected to pay a dividend yield of 11.8% in FY26 and 12.5% in FY27. Those are huge yields for investors hoping for retirement.
