The ASX share market is a wonderful place to find investment opportunities that can provide strong levels of passive income in superannuation.
Some businesses can provide investors with a high dividend yield because they have a generous dividend payout ratio. The yield could be high because of pleasing franking credits. Or, the payout could be compelling because the business is priced cheaply.
Let's look at two investment options that could deliver a very pleasing yield to investors with $25,000.
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Rural Funds Group (ASX: RFF)
Some retirees may love the idea of investing in farmland for retirement. But, owning commercial property ourselves can come with a lot of administration and potentially costs. Why not just own a real estate investment trust (REIT) that invests in farmland for us.
It invests in areas like almonds, cattle, macadamias, vineyards and cropping, giving investors various exposure to different, attractive growth areas. Over time, Rural Funds benefits from rental indexation which is either fixed annual increases or the rises are linked to inflation, plus market reviews.
Another positive of Rural Funds is that it has defensive rental earnings, with high-quality and reliable tenants, with a weighted average lease expiry (WALE) of well over a decade.
The business pays a distribution every quarter and this means shareholders are getting regular passive income in superannuation.
I expect the business will pay an annual distribution of something like 11.73 cents (the same as FY26) in FY27. That translates into a forward distribution yield of 5.9%.
Future Generation Australia Ltd (ASX: FGX)
Future Generation Australia is a listed investment company (LIC) that has a number of positives.
For starters, it donates 1% of its net assets each year to youth-focused charities. Fund managers work for free to enable the business to enable that philanthropy.
The LIC is invested in the funds of a number of different fund managers, meaning Future Generation can provide significant diversification.
Future Generation Australia is able to provide investors with growing dividends because LICs can turn investment profits into dividends.
It has increased its annual dividend per share each year for the last decade, meaning it has provided an excellent level of stability for investors. The annual payout for FY25 was 7.2 cents per share, which translates into a trailing grossed-up dividend yield of 7.7%, including franking credits, at the time of writing. That's a great yield for superannuation investors wanting passive income, in my opinion.
I think it's likely the business will increase its annual payout during 2026, so the yield could be even better.
