ASX stocks are a fantastic place to invest for passive income in retirement. But, I'd only choose investments that I'm confident can provide rewarding and resilient payouts.
Not every business can be reliable, partly because of the industry they operate in. Miners, for example, are heavily exposed to movements in resources prices – this can lead to large rises and large declines of resource prices (and dividend payouts).
There are plenty of great dividend options beyond the large ASX blue-chip shares. I'm going to outline two I'd happily invest $15,000 into.
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Rural Funds Group (ASX: RFF)
I think Rural Funds is one of the leading real estate investment trusts (REITs) for passive income. The business owns a portfolio of farms across the country, including almonds, macadamias, cattle, vineyards, and cropping.
Having this investment gives Aussies diversification because Rural Funds offers something different to most other ASX dividend shares, and its own portfolio is diversified across various food segments.
Rural Funds recently took the responsible decision to sell some of its farms to improve its debt position, and this is also expected to improve its adjusted funds from operations (AFFO) – that's the net rental profit.
The business' FY26 payout of 11.73 cents per unit translates into a distribution yield of 5.3%, which I'd describe as a solid starting yield for retirement. It hasn't ever reduced its cash payout since it started paying more than a decade ago.
The payout can increase in the future thanks to its built-in rental indexation. Most of the farms have rental increases that are fixed, or linked to inflation, plus market reviews.
Future Generation Global (ASX: FGG)
Another ASX stock I want to highlight is the listed investment company (LIC) Future Generation Global, an investment vehicle that gives exposure to the global share market.
All of the fund managers involved in the LIC work for free so that Future Generation Global can donate 1% of its net assets each year to youth mental charities. The LIC is invested in more than a dozen different funds from different fund managers, giving shareholders exposure to more than 3,000 underlying shares – that's great diversification!
The business is able to provide investors with a solid dividend thanks to all of the investment returns it has already made over previous years and continues to make.
Future Generation Global recently lifted its FY26 interim dividend by 5% year over year, taking its annualised payout to 8.4 cents per share. This translates into a forward grossed-up dividend yield of around 7%, including franking credits, at the time of writing. I think that's a wonderful yield for people in retirement. The ASX stock has increased its payout each year since FY19, so it has given investors several years of dividend hikes already, and I expect more in the coming years.
