Superannuation plays a vital role in any retirement plan. However many investors will aim to generate passive income and capital growth using ASX shares and ETFs.
A typical Australian superannuation fund invests your money in a diversified mix of assets.
This likely includes Australian and international shares, bonds, property, infrastructure, and cash. This creates diversification rather than focusing solely on high-dividend stocks.
Subsequently, many retirees will target high dividend shares to provide passive income once they stop working.
While passive income is a great way to supplement your super, the threat of inflation also means retirees can't ignore capital growth.
Here are three stocks that can provide a balanced retirement portfolio of income and growth.
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Vanguard Australian Shares High Yield ETF (ASX: VHY)
This ASX ETF has been a trusted passive income vehicle for Australian investors for years.
It targets companies listed on the Australian Securities Exchange with higher forecast dividends than other ASX-listed companies.
Security diversification is achieved by restricting the proportion invested in any one industry to 40% of the ETF's total and to 10% in any one company. Australian Real Estate Investment Trusts (A-REITS) are excluded from the index.
It has historically provided a yield of around 5% and comes with a low management fee of 0.25% p.a.
As a bonus, it has risen by 25% over the last 5 years, providing growth and consistent passive income.
Telstra Group Ltd (ASX: TLS)
Turning attention to an individual stock, Australia's largest telecommunications provider, Telstra, has been a trusted income source for dividend investors for many years.
Its defensive profile provides protection against sudden market swings, and it is forecast to pay a total dividend of 21 cents in FY26, translating to a forward dividend yield of around 4.1%.
Similarly, to VHY ETF, Telstra has also risen significantly in the last 5 years.
Since 2021, it has risen over 40%.
BetaShares Nasdaq 100 ETF (ASX: NDQ)
While Telstra and the VHY ETF provide passive income, this Betashares fund provides a hedge against inflation.
It aims to track the performance of the Nasdaq 100 Index (before fees and expenses). The Nasdaq 100 comprises 100 of the largest non-financial companies listed on the Nasdaq market.
These companies are at the forefront of the new economy, meaning their profile is tilted towards growth and innovation.
It also provides some diversification away from an Australian-dominated portfolio, particularly towards sectors like technology that are underrepresented here in Australia.
This means it could provide some protection against ASX downturns.
Over the last 5 years, it has been a market winner, rising 100%.
