The ASX dividend stock Future Generation Global Ltd (ASX: FGX) could be one of the best options for reliable dividends on the ASX.
There are not many ASX shares that have increased their dividend payout every year over the past decade, which I think makes it clear that the board of directors wants to give investors reliable payouts.
The ASX dividend stock offers a winning combination of a high dividend yield and growth. Let's run through why I think it's a top option for passive income.
Image source: Getty Images
Diversification
Rather than getting exposure to a single business like Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP), investing into this ASX dividend stock gives investors exposure to multiple portfolios.
Future Generation Australia is a listed investment company (LIC) which gives investors exposure to a portfolio of funds.
All of those fund managers work for free so that Future Generation Australia can donate 1% of its net assets each year to youth charities.
The funds are invested across both large and small ASX shares, providing exposure to more than 430 shares. I like this strategy because it gives more exposure by weighting to growing businesses than the overall ASX share market does.
Some of the fund managers that are involved here include Vinva, Firetrail, Smallco, Eley Griffiths, QVG, L1 Group Ltd (ASX: L1G) and Sandon Capital.
Large dividend yield
As I've already mentioned, this ASX dividend stock is providing investors with a very pleasing dividend yield.
Future Generation Australia has already provided guidance about what its upcoming 2026 financial year annual dividend will be.
The ASX dividend stock has said that FY26 payout will be 7.6 cents per share.
At the time of writing, that translates into a grossed-up dividend yield of 8.4%, including franking credits. I think the business is one of the best for large dividends for the foreseeable future.
Rising payouts
It's not just the size of the dividend that's impressive, but this business has regularly increased its payout. Few high-yielders can point to a record like Future Generation Australia's.
The ASX dividend stock has increased its annual dividend per share every year since 2015 – that's more than a decade of regular increases. I think plenty of ASX blue-chip shares would love to be able to say they've increased their payout every year for the past decade.
What a $3,000 investment could unlock
If someone were to invest $3,000 into Future Generation Australia shares today with an 8.4% dividend yield (including franking credits), it would unlock approximately $176.74 of dividend cash and around $252.49 of overall dividend income with an investment of 2,325 Future Generation Australia shares.
That's a really impressive level of dividends, though I'm not expecting significant capital growth because it's paying so much of its profit out as dividends.
