Rather than having to research and buy a dozen or more dividend paying stocks, you can get that diversity, and more, from an ETF with a single investment.

I mention buying a dozen or more dividend stocks because you don't want to simply buy one or two high yielding companies. While that may work out in the shorter-term, even quality companies with a good track record of annual dividend payouts can run into headwinds that could slash the passive income you were expecting to bank.

While ASX ETFs don't remove all of that risk, they do work to help smooth your returns over time.

With that said…

Two top passive income ASX ETFs to buy today

The first fund I'd buy is the BetaShares Australian Dividend Harvester Fund (ASX: HVST).

One of the appealing things for passive income investors is that this ASX ETF gives investors instant diversity through its portfolio of 40 to 60 high-yielding, blue-chip ASX shares. The fund's management team screens these for high dividend and franking outcomes based upon expected future gross dividend payments.

As of 31 July, the ASX ETF's top three holdings are Commonwealth Bank of Australia (ASX: CBA) BHP Group Ltd (ASX: BHP) and Wesfarmers Ltd (ASX: WES).

And HVST pays out dividends on a monthly basis, so your next passive income payout is never too far away.

Because the ETF's holdings are actively managed and rebalanced every three months to target higher yielding ASX dividend stocks, the annual management fee is 0.72%.

As at 31 July the HVST had 12-month trailing yield of 5.6%, 63% franked. Those franking credits bring the grossed-up yield to 7.1%.

Which brings us to the second ASX ETF I'd buy to target $10,000 a year in passive income, the iShares S&P/ASX Dividend Opp ESG Screened ETF (ASX: IHD).

IHD provides exposure to 50 of the highest-yielding shares on the S&P/ASX 300 Index (ASX: XKO). The fund will appeal to ESG investors, with management screening stock selection to avoid companies engaged in serious ESG controversies.

As at 31 July, IHD's top three holdings are BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO), and Australia and New Zealand Banking Group Ltd (ASX: ANZ).

IHD trades on a 4.1% trailing dividend yield, franked at around 76%. That equates to a 5.5% grossed-up yield.

How much do I need to invest today?

Working with the grossed-up trailing dividend yields here – and taking note that future yields could be higher or lower – just how much would you need to invest in these two ASX ETFs for $10,000 a year in passive income?

Well, assuming you invest the same amount in each fund, then you'll receive an average grossed-up yield of 6.3%.

So, for $10,000 a year in passive income, you'd need to invest $158,730 today.

You can also invest a smaller amount on a monthly basis, and you'll reach your income goal in good time.

The post Why I'd buy these 2 ASX ETFs for $10,000 a year in passive income appeared first on The Motley Fool Australia.

With this in mind, and given the rising popularity of exchange-traded funds (ETFs), let's take a look at the best dividend ETFs of FY26.

We reviewed the one-year returns of 458 ETFs on the market to determine the best-performing ETFs targeting high dividend yields.

We have ranked these ETFs based on total one-year returns. Total returns are comprised of unit price growth and distributions.

Distributions can have several components. The main ones are dividends and realised capital gains within the fund.

Investors targeting high dividend yields via ASX ETFs need to bear realised capital gains in mind for tax purposes.

These rankings are based on full-year performance data from the Australian Securities Exchange.

1. iShares S&P/ASX Dividend Opp ESG Screened ETF (ASX: IHD)

IHD ETF delivered a total one-year return of 22%. The 12-month trailing distribution yield is 4%.

This ASX ETF seeks to track the returns of the S&P/ASX Sustainability Screened Dividend Opportunities Index before fees.

The index features 50 shares from the S&P/ASX 300 Index (ASX: XKO) with the highest forecast dividend yields.

Stock selection is subject to diversification, profitability, and tradability requirements. For example, they must have a minimum market cap of $500 million, a 12-month history of positive earnings per share (EPS), and no stock may have a weighting greater than 10%.

Over time, stocks can move beyond 10%, but the index provider sells them down at the next rebalance.

Index provider S&P Global also screens the stocks under environmental, social, and corporate governance (ESG) criteria to exclude selected activities. These include nuclear weapons, thermal coal, oil and gas, alcoholic beverages, gambling, and military contracting.

S&P Global also excludes ASX real estate investment trusts (REITs).

About 43% of the fund is ASX financial stocks, 27% are materials shares, including miners, and 16% are industrial stocks.

Currently, IHD ETF's top holdings are: BHP Group Ltd (ASX: BHP) (11.5%), Rio Tinto Ltd (ASX: RIO) (10%), Australia and New Zealand Banking Group Ltd (ASX: ANZ) (9.1%), and National Australia Bank Ltd (ASX: NAB) shares (8.8%).

This ASX ETF pays dividends quarterly, and the management fee is 0.23%.

IHD ETF has been trading since December 2010. The index is rebalanced semi-annually.

Average annual total returns have been 15.3% over three years, 9.7% over five years, and 8.6% over 10 years.

IHD ETF has $409 million in funds under management (FUM).

2. Global X S&P/ASX 200 High Dividend ETF (ASX: ZYAU)

ZYAU ETF gave investors a total one-year return of 19% in FY26. The trailing distribution yield is 4.3%.

This ASX ETF tracks the S&P/ASX 200 High Dividend Index before fees.

The index features 50 high-dividend shares from the S&P/ASX 200 Index (ASX: XJO).

Index manager S&P Global defines high-dividend stocks as those with the highest 12-month forecast dividend yields.

S&P Global caps the number of selected stocks per sector at 15, and no stock has a weighting greater than 10%.

ASX REITs and stocks ranked in the bottom 10% by momentum value, according to S&P Global's momentum indices, are excluded.

About 39% of the fund is ASX financial stocks, 22% are materials shares, and 12% are energy stocks.

ZYAU ETF's top holdings are: BHP (11.3%), ANZ (9.6%), NAB (9.3%), and Westpac Banking Corp (ASX: WBC) shares (9.3%).

This ASX ETF pays distributions quarterly, and the management fee is 0.24%.

ZYAU ETF has been trading since June 2015. The index is rebalanced semi-annually.

Average annual total returns have been 13.2% over three years, 6.1% over five years, and 6% over 10 years.

ZYAU ETF has $95 million in FUM.

3. Vanguard Australian Shares High Yield ETF (ASX: VHY) 

The largest dividend-focused ASX ETF on the market today, with $7.6 billion in FUM, is VHY ETF.

In FY26, VHY generated a total one-year return of 18%. The trailing distribution yield is 3.6%.

VHY ETF tracks the FTSE Australia High Dividend Yield Index before fees.

The index is comprised of 92 ASX shares with the highest 12-month forecast dividend yields, sourced from professional brokers.

Rules include limiting exposure to any one industry at 40%, and a 10% weighting for any single ASX share. REITs are excluded.

About 40% of the fund is ASX financial stocks, 22% are materials shares, and 10% are energy stocks.

The VHY ETF's top holdings are: Commonwealth Bank of Australia (ASX: CBA) (10%), BHP (9.6%), Westpac (6.4%), and NAB shares (6.2%).

This ASX ETF pays distributions quarterly, and the management fee is 0.25%.

VHY ETF has been trading since May 2011. The index is rebalanced semi-annually.

Average annual total returns have been 14.3% over three years, 11% over five years, and 10.5% over 10 years.

4. State Street SPDR MSCI Australia Select High Dividend Yield ETF (ASX: SYI)

SYI ETF produced a total one-year return of 15%. The trailing distribution yield is 7.6%.

This ASX ETF tracks the MSCI Australia Select High Dividend Yield Index before fees.

State Street says the index employs a robust stock selection process that "screens for persistent and financially sustainable dividends, targets recurring income and helps avoid dividend traps".

About 48% of the fund is ASX financial stocks, 10% are healthcare shares, and 9% are communications stocks.

SYI ETF's top holdings are: NAB (10.5%), ANZ (9.9%), Westpac (9.8%), and CSL Ltd (ASX: CSL) (8.8%).

This ASX ETF pays distributions quarterly, and the management fee is 0.2%.

SYI ETF has been trading since September 2010. The index is rebalanced semi-annually.

Average annual total returns have been 12.6% over three years, 9.8% over five years, and 9.2% over 10 years.

SYI ETF has $664 million in FUM.

The post 4 best ASX dividend ETFs of FY26 appeared first on The Motley Fool Australia.

Perhaps that's no surprise, given materials was the best performer of the 11 market sectors by a long shot in FY26.

The S&P/ASX 200 Materials Index (ASX: XMJ) soared 47% and produced total returns, including dividends, of 52%. 

That compares to a 3% rise for the S&P/ASX 200 Index (ASX: XJO) and a total return of 7%.

The Australian Securities Exchange has just released the full-year performance data for ASX ETFs in FY26.

Let's take a closer look at the best performers among ETFs invested solely in Australian equities.

Top 6 ETFs holding Aussie shares

We've ranked these ETFs by total returns, which incorporates capital growth plus distributions (dividends).

1. SPDR S&P/ASX 200 Resources ETF (ASX: OZR)

OZR ETF delivered an exceptional total one-year return of 51%. The historical distribution yield is 2.4%.

The OZR ETF is $16.63, down 2.4% on Friday.

This ASX ETF seeks to mirror the performance of the S&P/ASX 200 Resources Index.

OZR invests in 59 large companies, predominantly miners, oil and gas suppliers, and other resources companies like steel makers.

The ETF currently has a 40% weighting to BHP Group Ltd (ASX: BHP) shares.

The management fee is 0.34%.

2. Betashares Australian Resources Sector ETF (ASX: QRE)

QRE ETF produced an equally impressive total one-year return of 50%. The historical distribution yield is 2.3%.

QRE ETF is $9.54, down 1.6% today.

This ASX ETF seeks to track the Solactive Australia Resources Sector Index.

It is invested in 56 resources companies and also has a 40% weighting to BHP shares.

The management fee is 0.34%.

3. VanEck Australian Resources ETF (ASX: MVR)

MVR ETF gave investors a total return of 42% in FY26. The historical distribution yield is 2.6%.

MVR ETF is $44.36, down 2.3% today.

This ASX ETF tracks the MVIS Australia Resources Index.

Index constituents are determined using a rules-based methodology focused on liquidity, with a minimum 20 holdings and maximum weighting of about 8% each. There are 35 ASX shares in the index presently.

Examples of companies included in the index are miners; mining services and equipment providers; coal, oil, gas, and uranium producers; power generation and renewable energy suppliers; and young companies with the potential to generate at least 50% of their revenue from mining once fully developed. Stocks must exceed a market capitalisation of US$150 million to be considered for the index.

Woodside Energy Group Ltd (ASX: WDS) is the largest constituent in the fund with an 8.34% weighting today.

The management fee is 0.35%.

4. iShares S&P/ASX Dividend Opp ESG Screened ETF (ASX: IHD)

This dividend-focused ETF delivered a total one-year return of 22%. The historical distribution yield is 4%.

IHD ETF is $17.06, down 0.4% today.

This ASX ETF tracks the S&P/ASX Sustainability Screened Dividend Opportunities Index.

The index is comprised of 50 high-yielding ASX shares that have been screened with environmental, social, and corporate governance (ESG) criteria to exclude selected activities.

This ASX ETF pays dividends quarterly, and the management fee is 0.23%.

5. Dimensional Australian Value Trust Active ETF (ASX: DAVA)

DAVA ETF gave investors a total return of 21% in FY26. The historical distribution yield is 6.7%.

This ASX ETF is trading at $30.86 on Friday, up 0.1%.

DAVA is an active ETF whose objective is long-term capital growth using a value investing strategy.

The management fee is 0.335%.

6. BetaShares FTSE RAFI Australia 200 ETF (ASX: QOZ)

QOZ ETF delivered a total one-year return of 20%. The historical distribution yield is 3.8%.

This ASX ETF is trading at $18.96 on Friday, down 0.4%.

QOZ tracks the FTSE RAFI Australia 200 Index, which captures 200 listed companies weighted by economic importance rather than simple market capitalisation.

Betashares says index constituent weighting is based on accounting values, and is known as "fundamental indexing".

The broker further explains:

QOZ's approach aims to deliver outperformance by selling expensive shares while buying those which are undervalued.

By removing the link between the price of a stock and its weight in the index, QOZ's strategy is less affected by fads and bubbles.

The biggest constituents today are BHP shares at 14% and Commonwealth Bank of Australia (ASX: CBA) at 7%.

The management fee is 0.4%.

Further reading

Check out the 6 best international ASX ETFs of FY26.

The post 6 best ETFs holding ASX shares in FY26 appeared first on The Motley Fool Australia.

As is the case with other ETF providers this season, there are some mega dividends on the list.

The biggest dollar-value dividend on the iShares schedule is $13.98 per unit for iShares MSCI South Korea ETF (ASX: IKO) units.

The iShares Global 100 (Currency-hedged) ETF (ASX: IHOO) will pay investors $11.82 per unit, making it another major payer.

Examples of other mega dividends this season include a VanEck fund paying $17.99 per unit and a Global X fund paying $16.26 per unit.

The ex-dividend date for iShares ETFs is tomorrow, 1 July. BlackRock will pay ASX ETF investors on 13 July. 

iShares ASX ETF dividends

Here is an abridged list of estimated distributions that iShares ETF investors will receive on 13 July.

Own other ASX ETFs?

If you own Vanguard ETFs such as Vanguard Australian Shares Index ETF (ASX: VAS), see this season's dividends here.

Invested in VanEck ETFs such as VanEck Gold Miners ETF (ASX: GDX)? View distributions here.

If you own Global X ETFs like Global X Semiconductor ETF (ASX: SEMI) or Global X Fang+ ETF (ASX: FANG), see a list of dividends here.

The post Own ASX IVV or other iShares ETFs? Here is your next dividend appeared first on The Motley Fool Australia.

The share market exists precisely for this purpose. It lets ordinary investors become silent owners of real businesses generating real cash flow, without needing to manage staff, chase invoices, or sit through board meetings.

Income-focused exchange-traded funds (ETFs) take this idea one step further. Rather than doing the homework on individual companies, the fund does it for you — bundling dozens of dividend-paying businesses into a single holding that pays out distributions at regular intervals.

The question most investors never quite get around to answering is: How do I actually build this kind of income stream if I don't have a lump sum sitting ready to deploy?

That's where dollar-cost averaging comes in.

The quiet power of regular contributions

Dollar-cost averaging — or DCA — is the practice of investing a fixed dollar amount at regular intervals, regardless of what the market is doing. When prices fall, your contribution buys more units. When prices rise, it buys fewer. Over time, this tends to smooth out the average cost of your investment.

It's not a strategy designed to maximise returns. It's designed to maximise discipline.

For most Australians building wealth around a salary, DCA reflects reality anyway. You earn, you save, you invest — consistently and repeatedly. The structure simply puts intention behind what would otherwise be an ad hoc process.

Applied to income-producing ETFs, dollar-cost averaging creates something compounding and structural over time: a growing portfolio that throws off increasing distributions each year, without requiring you to make active calls on markets or individual companies.

3 income ETFs worth considering

The Vanguard Australian Shares High Yield ETF (ASX: VHY) is the obvious starting point. With nearly $7 billion in funds under management, it is the largest dedicated income ETF in Australia. The VHY ETF tracks the FTSE Australia High Dividend Yield Index, holding 79 companies, including names such as BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), and Telstra Group Ltd (ASX: TLS). Its approximate dividend yield sits at 4.3%, and its management fee of 0.25% keeps costs reasonable. For a regular investor building toward income, VHY is a sensible core holding.

For those seeking a global income layer, the SPDR S&P Global Dividend Fund (ASX: WDIV) offers exposure to 97 high-yielding companies across international markets, yielding approximately 5.2% and charging a fee of 0.35%. Adding WDIV alongside a domestic holding reduces concentration in Australian banks and resources, sectors that dominate the local income landscape.

Investors looking for a lower-cost domestic option might also consider the iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD), which carries a management fee of 0.23% and delivered a one-year total return (dividends and capital gains) of over 23%. IHD applies an ESG screen, meaning it excludes companies that don't meet certain environmental, social, and governance criteria.

Foolish Takeaway

The goal of dollar-cost averaging into income ETFs is not to get rich overnight. It is to build a machine — slowly, methodically — that generates cash flow from businesses you own but never have to run.

In the early stages, reinvesting distributions accelerates the compounding. As the portfolio grows, those same distributions can become income you actually spend.

No strategy removes market risk entirely, and ETF distributions are not guaranteed to remain constant year to year. But for investors who want exposure to the income-generating capacity of Australian and global businesses without the active management burden, a regular contribution plan into a small basket of income ETFs is one of the most straightforward approaches available.

The best time to start is usually before you feel ready.

The post How to dollar-cost average your way to passive income with ETFs appeared first on The Motley Fool Australia.

These ETFs include the iShares Core S&P/ASX 200 ETF (ASX: IOZ), which is trading at $36.06 per unit, up 0.33% this morning.

Investors participating in the distribution reinvestment plan (DRP) for any of these ASX ETFs will receive their new units shortly.

Here are the final distributions for investors receiving cash payments, and the DRP prices for those who are reinvesting their dividends.

Dividends for iShares ETFs

Own other ASX ETFs?

It's dividend season for several ASX ETF providers.

If you own Betashares ETFs such as Betashares Australia 200 ETF (ASX: A200) or Betashares Diversified All Growth ETF (ASX: DHHF), check your bank account today to ensure you received your dividend payment yesterday.

If you own Vanguard ETFs such as Vanguard Australian Shares Index ETF (ASX: VAS) or Vanguard Australian Shares High Yield ETF (ASX: VHY), you were also paid yesterday.

Follow the links provided above to find out how much your dividends or DRP unit prices were for this round of distributions.

The post Own ASX IOZ or other iShares ETFs? Here are the dividends you'll get today appeared first on The Motley Fool Australia.

BlackRock has announced the estimated distributions (dividends) for a range of its ASX iShares exchange-traded funds (ETFs).

The fund manager will pay investors on 21 April.

Dividends for iShares ASX ETFs

Here are the estimated dividends that investors will receive on 21 April.

The amounts will be finalised tomorrow, which is also the record date.

These iShares ETFs are trading ex-dividend today.

How is ASX IOZ performing?

The ASX IOZ aims to mirror the performance of the S&P/ASX 200 Accumulation Index, before fees and expenses.

The Accumulation Index is different to the S&P/ASX 200 Index (ASX: XJO) because it assumes the reinvestment of dividends.

Therefore, the index reflects total returns over a given period, whereas the benchmark ASX 200 Index only reflects capital gains.

This ETF provides an easy way to invest in the top 200 companies by market capitalisation on the ASX.

It includes exposure to the biggest ASX 200 banks and mining shares, which have traditionally paid some of the largest dividend yields.

They include the market's largest company, Commonwealth Bank of Australia (ASX: CBA), as well as BHP Group Ltd (ASX: BHP) shares.

Over the 12 months to 31 March, ASX IOZ returned 11.71% to investors.

The ETF's three-year average return is 9.47%. The five-year average return is 8.56%.

The management fee is 0.05%.

The post Own ASX IOZ or other iShares ETFs? Here is your next dividend appeared first on The Motley Fool Australia.

But not all income ETFs are created equal. Some focus on high yield, others prioritise consistency, and a few aim to actively boost income.

Here are 3 standout ASX ETFs that income investors should have on their radar right now.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This Vanguard fund is one of the most popular income ASX ETFs on the market — and for good reason. It focuses on high-dividend-paying Australian companies, delivering a strong yield with broad exposure across sectors like banks, miners, and telcos.

Its biggest strength is simplicity and scale, offering a diversified portfolio of around 80 companies with a low management fee of just 0.25%. Major holdings include BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA), two of the ASX's most reliable dividend payers.

The trade-off? It's heavily weighted toward financials and resources, which can increase concentration risk.

BetaShares Australian Dividend Harvester Active ETF (ASX: HVST),

Next up is this BetaShares fund, which takes a more hands-on approach. Unlike index-tracking ETFs, HVST is actively managed and aims to deliver consistent income. It's even paying distributions monthly.

That makes it especially attractive for retirees or investors who want regular cash flow.

The ASX ETF typically holds 40 to 60 ASX shares, focusing on highly franked dividend payers. Key holdings often include National Australia Bank Ltd (ASX: NAB) and Wesfarmers Ltd (ASX: WES). The strength here is income consistency and active management.

The downside? Higher fees, around 0.72%, and the risk that active strategies don't always outperform.

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

Finally, the iShares S&P/ASX Dividend Opportunities ETF offers a slightly different flavour of income investing. This fund tracks an index of Australian companies expected to deliver above-average dividends, with a focus on sustainability and ESG screening.

Its management fee sits at around 0.23%, making it one of the cheaper options in the dividend ETF space.

Top holdings include Westpac Banking Corporation (ASX: WBC) and Fortescue Ltd (ASX: FMG). While its yield is typically lower than VHY, it offers a more balanced approach and slightly less concentration risk.

Foolish Takeaway

If you're chasing income in 2026, these ASX ETFs each bring something different to the table. VHY offers scale and strong yield, HVST targets consistent monthly income, and IHD delivers a lower-cost, diversified dividend strategy.

The right choice comes down to your goals — maximum yield, steady cash flow, or balanced income with lower fees.

The post 3 of the best ASX ETFs for income investors in 2026 appeared first on The Motley Fool Australia.

One option is to look for exposure to more defensive shares.

However another option is to start focussing on passive income rather than growth. 

In volatile markets, prices swing unpredictably. If you're focused on growth, your returns depend heavily on when you buy and sell.

With income investing:

• You're paid regardless of short-term price movements
• You don't need to sell assets in a downturn to generate cash. 

For example, if markets drop 20%, a growth investor may decide to sell at a loss.

A dividend investor can live off distributions and wait it out.

It's important to note that volatility doesn't mean you suddenly shift your entire portfolio. 

However, allocating some exposure to passive income may be worthwhile. 

One way to do this is through diversified dividend ASX ETFs. 

Here are three to consider. 

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This ASX ETF is one of the most popular passive income generating funds. 

It seeks to track the return of the FTSE Australia High Dividend Yield Index. 

Essentially, it targets stocks that have higher forecast dividends relative to other ASX-listed companies. 

Security diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% for any one company. 

Australian Real Estate Investment Trusts (A-REITS) are excluded from the index.

It currently provides a dividend yield of approximately 4%, paid quarterly. 

Betashares Australian Dividend Harvester Fund (ASX: HVST)

HVST ETF aims to provide franked income that exceeds the net income yield of the broad Australian sharemarket on an annual basis, along with exposure to a diversified portfolio of Australian shares.

The ETF's share portfolio is generally selected from the largest 100 Australian shares on the ASX, screened for high dividend and franking outcomes based upon expected future gross dividend payments.

The share portfolio is rebalanced approximately every three months, with the aim of including the shares that are expected, within the next rebalance period, to provide the highest gross yield outcomes.

It pays distributions monthly, and has a 12 month gross distribution yield of 7.0%. 

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

This ASX ETF includes roughly 50 ASX listed stocks that offer high dividend yields while meeting diversification, profitability and tradability requirements as well as being screened for sustainability considerations.

It also tracks an S&P/ASX ESG benchmark. 

According to iShares, it has a 12 month trailing yield of 4.32%. 

Distributions are paid quarterly. 

The post 3 of the best dividend ASX ETFs right now appeared first on The Motley Fool Australia.

By reinvesting those dividends early and letting compounding do the heavy lifting, investors can gradually build a portfolio capable of funding their lifestyle years before the traditional retirement age.

Here are 3 ASX dividend ETFs that could help you achieve that goal.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This is the largest ASX dividend ETF on the Australian market and aims to track the FTSE Australia High Dividend Yield Index. It invests in around 70 Australian companies known for paying strong dividends. Major holdings include Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), and Telstra Group Ltd (ASX: TLS). 

The strength of this ASX ETF lies in its simplicity and scale. It focuses on large, established ASX companies with strong cash flows and consistent dividend histories. Many of these dividends come with valuable franking credits, which can boost after-tax income for Australian investors. The ETF also charges a relatively low management fee of around 0.25% per year. 

For investors targeting early retirement, VHY can form a solid income foundation. By reinvesting distributions over the years, investors can steadily grow their number of units and future income stream.

SPDR MSCI Australia Select High Dividend Yield ETF (ASX: SYI)

This fund screens the Australian market for companies with strong dividend yields and sustainable payouts. It holds around 40 to 60 companies and has one of the lowest management costs in the dividend ETF category at roughly 0.20%. The largest holdings are National Australia Bank Ltd (ASX: NAB), Macquarie Group Ltd (ASX: MQG), and Woodside Energy Group Ltd (ASX: WDS).

This ASX dividend ETF focuses on quality income. Instead of simply chasing the highest yield, it filters companies based on financial strength and dividend sustainability. That approach can help investors avoid so-called yield traps, where companies offer high dividends but struggle to maintain them.

For someone planning to retire at 57, that balance between yield and quality could prove valuable.

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

This ASX dividend ETF holds around 50 high-yielding Australian companies and targets businesses with strong dividend profiles. Key holdings include BHP, Telstra, Rio Tinto Ltd (ASX: RIO), and Transurban Group (ASX: TCL). 

IHD provides exposure to many of the ASX's most reliable dividend payers while spreading risk across a broad group of companies. This diversification can help smooth income streams and reduce reliance on any single stock.

Foolish Takeaway

Sometimes, the path to early retirement doesn't require complex strategies. A simple portfolio of high-quality dividend ETFs, combined with patience and compounding, can do much of the heavy lifting.

The key advantage of combining these 3 ASX dividend ETFs is diversification. Instead of relying on just a handful of shares, investors gain exposure to dozens of dividend-paying companies across banks, miners, retailers, and infrastructure businesses. That diversification can help stabilise income even when certain sectors face challenges.

The post 3 ASX dividend ETFs that could help you retire at 57 appeared first on The Motley Fool Australia.

A handful of ASX ETFs now bundle the market's biggest dividend payers into a single trade. They offer instant diversification and regular income.

Three ASX ETFs stand out for investors chasing yield without abandoning long-term growth potential.

Let's take a closer look.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

Vanguard Australian Shares High Yield ETF has become a go-to option for dividend hunters. The ASX ETF targets Australian companies with above-average forecast yields, which naturally tilts it toward banks, miners and energy giants.

Heavyweights like Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), BHP Group Ltd (ASX: BHP) and Woodside Energy Group Ltd (ASX: WDS) tend to sit near the top of the portfolio.

That concentration explains why distributions can look very attractive in strong commodity or banking cycles. The yield is typically well above the broader S&P/ASX 200 Index (ASX: XJO) and often boosted by franking credits. At the current share price of $82.65, the yield is 9%.

Growth isn't the main attraction, but over time capital returns have tracked the performance of Australia's largest blue chips. This makes it a classic income-first ETF with some upside attached. In the past 12 months, VHY ETF has grown by 8% at the time of writing.

Global X S&P/ASX 200 High Dividend ETF (ASX: ZYAU)

This smaller ASX ETF takes a slightly different approach. Instead of reaching deep into the market for yield, it stays closer to the ASX 200 and selects companies with strong dividend characteristics.

Banks still dominate, but infrastructure stocks, telcos and established industrials also feature prominently. That tends to smooth volatility compared with more aggressive high-yield strategies. Just 1.3% of the fund is invested in companies in the US and Europe.

The dividend yield is usually lower than the pure high-yield ETFs – 5.6% at current price levels – but investors get broader exposure to the market and a better balance between income and growth. For those who want dividends without drifting too far from the benchmark, this ETF sits in the middle ground.

iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD)

The iShares S&P/ASX Dividend Opportunities ESG Screened ETF adds a sustainability filter to the income equation. This $364 million ASX ETF focuses on a smaller group of higher-yielding Australian companies while excluding businesses that don't meet ESG criteria.

The result is a portfolio that still leans toward banks and established dividend payers, but with different sector weights to traditional high-yield funds. The dividend yield is generally more modest, offering 4.9% at the time of writing. Yet distributions are still competitive, and long-term returns aim to combine steady income with moderate capital growth.

This option appeals to investors who want attractive dividends without chasing the highest-yield. This ASX ETF was the best performing of the three ASX ETFs over the past 12 months, gaining 15% in value.

Foolish Takeaway

Together, these 3 ASX ETFs show there's more than one way to invest for income on the ASX.

Whether the priority is maximum yield, balance, or a blend of dividends and sustainability, dividend ASX ETFs can play a useful role in building passive income over time.

The post 3 ASX ETFs for investors chasing yield and growth appeared first on The Motley Fool Australia.

Those ETFs include iShares Core S&P/ASX 200 ETF (ASX: IOZ) and iShares S&P/ASX Small Ordinaries ETF (ASX: ISO).

IOZ ETF delivered a solid 10.36% return for 2025 in line with the strength of the benchmark S&P/ASX 200 Index (ASX: XJO) last year.

The ISO ETF outperformed, producing a 24.54% total return as ASX small-cap shares benefitted from three interest rate cuts.

Small-caps have market valuations of between a few hundred million dollars and $2 billion, and carry more debt to fund their growth.

Perpetual portfolio manager Alex Patten said 2025 represented the first time that small-caps had outperformed "in a number of years".

Patten said:

… now that rates are starting to come down, we're seeing more interest in small and micro caps and bit more liquidity in the market.

How much will ASX ETF investors receive today?

We have summarised the dividend amounts that investors will receive today, rounded to two decimal places.

The post Own IOZ or ISO ETFs? It's dividend payday for you! appeared first on The Motley Fool Australia.

Or perhaps iShares S&P/ASX 20 ETF (ASX: ILC) or iShares S&P/ASX Small Ordinaries ETF (ASX: ISO)?

BlackRock has just announced the estimated distributions (dividends) for its ASX iShares exchange-traded funds (ETFs).

BlackRock will pay its next round of dividends on 19 January.

If you own any of these ETFs and want to top up your holdings ahead of this round of payments, you'd better be quick.

The ex-dividend date is tomorrow.

How much will iShares ASX ETF investors receive?

Here are the estimated dividends that investors will receive on 19 January.

The amounts will be finalised on Thursday, which is the record date.

Prefer to reinvest your dividends?

A distribution reinvestment plan (DRP) is available for all of the ASX iShares ETFs above.

A DRP allows investors to reinvest their distributions automatically each time dividends are paid.

It's a helpful set-and-forget option for investors seeking compounding returns over the long term.

BlackRock will be accepting DRP elections up until 5pm today.

The post Own ASX IOZ or other iShares ETFs? Dividends just announced! appeared first on The Motley Fool Australia.

If so, we have exciting news for you!

BlackRock has just announced the estimated distributions for a range of its ASX iShares exchange-traded funds (ETFs).

Distributions is just another word for dividends. BlackRock will make the next round of payments on Wednesday, 22 October.

If you own any of these ETFs and want to top up your holdings ahead of the next distribution payment, you'd better be quick.

The ex-dividend date is tomorrow.

How much will iShares ASX ETF investors get?

Here are the estimated distributions for a range of ASX iShares ETFs.

Bear in mind that the amounts shown above are estimated distributions. BlackRock will advise us of the finalised figures on Monday.

Investors will receive their dividends on 22 October.

Want to reinvest your dividends?

A distribution reinvestment plan (DRP) is available for all of the ASX iShares ETFs above.

The DRP allows shareholders to reinvest their distributions automatically each time dividends are paid.

It's a helpful set-and-forget option for investors seeking compounding returns over the long term.

BlackRock will be accepting DRP elections up until 5pm today.

ASX IOZ share price snapshot

The IOZ ETF is trading at $36.43 per unit, up 0.5% on Thursday and up 9.2% over the past year.

ASX IOZ seeks to track the performance of the S&P/ASX 200 Accumulation Index, before fees and expenses.

The post Own ASX IOZ or other iShares ETFs? Here's your next dividend appeared first on The Motley Fool Australia.

In fact, data from S&P Global shows Australia has historically been one of the highest-yielding equity markets in the world. 

As of December 31, 2024, the trailing 12-month dividend yield of the S&P/ASX 300 Index (ASX: XKO) was 3.5%. 

This outpaces Europe (3.2%), Canada (2.8%), and the US (1.8%). 

Slow drop off

Despite Australia offering historically high yields, the last few years have seen a shift. 

In fact, the 3.5% trailing dividend at the end of 2024 is significantly lower than its long-term average of approximately 4.5% according to CommSec.

During the 10-year period between 2010 and 2019, close to 180 companies on average either maintained or increased dividends compared with the previous year. 

However, since 2021, there has been a moderate decrease in the number of companies that have increased dividends. 

As at the end of December 2024, 111 members of the ASX 300 Index pay fully franked dividends. 

How does this translate to investor income?

According to CommSec estimates, major Aussie companies classified in the S&P/ASX 200 Index (ASX: XJO) will pay out around $32.1 billion in dividends in the first five months of 2025, down 5.6% from last year's $34 billion.

Which sectors pay the best dividends?

Unsurprisingly, throughout the past 10 years, between 64% and 78% of the total dividend payments in the ASX 300 Index have come from the financials and materials sectors. 

A report from the ETF provider Betashares said as of the end of July 2025, 55% of all dividends paid out by the ASX 200 Index come from just ten companies. 

This concentration means that while franked dividends are still available, they are increasingly reliant on a small group of stocks, many of which are mature and cyclical.

Dividend darlings not immune 

According to Betashares, as earnings have been declining in parts of the Australian corporate sector, and company boards become more cautious given the uncertainty in the economy, there are arguably fewer companies that can afford to continue paying the high levels of fully franked dividends that investors have come to expect.

For example, BHP Group Ltd (ASX: BHP) recently declared a full-year dividend payout of US$1.10 per share.

The report from Betashares points out that while this is a fully franked figure, it is the lowest full-year payout since 2016/17 and follows a 26% decline in full-year profits. 

Another example is Woolworths Group Ltd (ASX: WOW), which recently cut its final dividend by 21%. 

Where to turn?

While this might all sound like doom and gloom, CommSec has helpful information on which sectors offer attractive yields. 

It lists energy shares, utilities, financials, consumer staples, and materials as sectors that offer the best yields. 

The Motley Fool is also always updating news and companies offering attractive yields here.

Furthermore, there are high-yield ASX ETFs that aim to provide investors with above-average dividend income. 

Some options to consider include: 

• Vanguard Australian Shares High Yield ETF (ASX: VHY)
• Betashares Australian Dividend Harvester Fund (ASX: HVST)
• iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

Foolish Takeaway 

While Australia still offers some of the highest yields amongst global markets, it is more important than ever for investors to research what yields are on offer. 

Investors should consider the history of a company's yields and pay attention to which direction this is trending. 

The post Why are ASX dividends shrinking? appeared first on The Motley Fool Australia.

The good news is that with discipline, smart investing, and time, that goal is achievable.

Step 1: Build a savings habit

The first step doesn't involve the sharemarket at all. It's about saving consistently. Even $500 a month invested regularly can snowball into a significant nest egg. This is where dollar-cost averaging (DCA) comes in — contributing steadily regardless of market conditions. By sticking to a schedule, you remove the temptation to time the market and benefit from buying through both highs and lows.

Step 2: Find the right investments

Not all investments are created equal. For those building towards a passive income target, the path usually begins with growth. Growth-focused ETFs, such as International growth ETF (ASX:GWTH) recently launched by VanEck, or broad-market options like BetaShares NASDAQ 100 ETF (ASX: NDQ), provide a simple way to compound wealth while staying diversified.

For investors comfortable with a core–satellite strategy, a core of ETFs can be paired with a few high-quality growth businesses that have strong competitive advantages and durable earnings power. These businesses won't always pay high dividends upfront, but their compounding potential can accelerate the journey towards a larger portfolio.

Step 3: Push through volatility

Markets never rise in a straight line. Periods of volatility are normal, sometimes even healthy. What separates successful long-term investors from the rest is the ability to stay invested and keep contributing through downturns. A disciplined savings plan, backed by dollar-cost averaging, ensures that volatility works in your favour rather than against you.

Step 4: Shift to income mode

Once your portfolio reaches scale, it's time to gradually rotate towards dividend payers. Income-focused ETFs, such as Vanguard High Yield (ASX: VHY) or iShares Dividend Opportunities (ASX: IHD), are designed to provide regular distributions.

At the stock level, reliable dividend growers in sectors like infrastructure, banking, or consumer staples can provide consistency. A portfolio yielding 5% on $1 million in assets equates to $50,000 a year in passive income. With franking credits, the effective income can be even higher.

Step 5: Stay the course

Building a second income stream isn't about chasing the next hot stock, it's about patience, compounding, and consistency. The maths is on your side. For instance, $6,000 saved and invested annually at an 8% return could grow into more than $300,000 over 20 years. That alone could provide $15,000 of annual passive income. Scale up the contributions, extend the timeframe, and $50,000 becomes realistic.

Foolish bottom line

Starting from zero, a $50,000 passive income target is ambitious but achievable. By saving regularly, investing in a mix of growth and income assets, and sticking through volatility, Australians can set themselves on a path to financial freedom. The journey won't happen overnight, but the compounding power of time and discipline makes it possible.

The post How to target a $50,000 passive income starting from zero appeared first on The Motley Fool Australia.

Passive income has become a financial goal for many Australians, and one of the most effective and accessible ways to generate it is through ASX dividend shares. Whether you're planning for retirement or just looking to boost your cash flow, the right strategy can get you there.

So, how much do you really need to earn $1,000 a month — or $12,000 a year — in dividends?

The $240,000 dividend portfolio

To generate $12,000 annually in dividends, you'll need a pretty sizeable portfolio.

Based on the assumption that a 5% dividend yield is achievable with relative ease, this means that a $240,000 investment portfolio will be required.

Of course, it is worth remembering that a 5% yield isn't guaranteed, but it is a reasonable target if you focus on quality dividend payers across sectors like financials, infrastructure, and consumer staples. And with franking credits on top, the after-tax yield could be even higher for some investors.

How to get there

If you don't have $240,000 lying around — don't worry, very few people do.

You can still work your way there over time.

Let's say you invest $1,000 a month into a portfolio of quality ASX shares or ASX ETFs, reinvesting any dividends, and earn an average return of 10% per annum.

If you achieved this, your investment portfolio would go from zero to the $240,000 mark in a touch over 11 years.

Increase your contributions, or achieve a slightly higher return, and you could hit that goal even sooner.

Choosing the right income assets

Here are a few ways to build a strong passive income portfolio on the ASX.

The first is individual ASX dividend shares. Look for companies with reliable cash flow, sustainable payout ratios, and a history of growing dividends. The likes of Telstra Group Ltd (ASX: TLS) and Accent Group Ltd (ASX: AX1) could be good examples of what to look for.

Another option is dividend-focused ASX ETFs. Funds like the Vanguard Australian Shares High Yield ETF (ASX: VHY) or iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD) offer diversified access to high-yielding companies.

There are also Listed Investment Companies (LICS) to choose from. Some are known for consistent dividend payments and can be useful for income-focused investors.

Foolish takeaway

Earning $1,000 a month in passive income from ASX dividends isn't just a pipe dream — it's a realistic and achievable goal with a plan, patience, and a little compounding magic.

Whether you're starting with $10,000 or building your portfolio from scratch, the key is to stay consistent, focus on quality, and reinvest until you reach your target.

And once you're there, your dividends can keep working for you — month after month, year after year.

The post Want $1,000 a month in passive income? Here's how to get there with ASX dividends appeared first on The Motley Fool Australia.

But let's talk about some ASX exchange-traded funds (ETFs) that can say the same.

Alongside ASX 200 shares, there has been a huge swath of ETFs that have seen new 52-week highs this Thursday. We won't go over them all, but here are 12 of the most prominent funds to hit new high watermarks:

12 ASX ETFs at new 52-week highs today

Here are the 12 ETFs that have just clocked new 52-week highs this Thursday:

*at the time of writing

Why are these funds at new highs today?

As you can see above, we have a very healthy mix to discuss. Typically, when we see a bunch of ETFs hit new highs, they are correlated to a particular asset class or market.

When the US markets reach new records, for example, the funds that hold mostly or solely American stocks usually follow suit.

But today, it's different.

We have your standard ASX index funds like IOZ and ILC at new highs.

But we also have some thematic, global funds – HACK, ASIA, ROYL and GXAI – there too.

We have some index funds, too. IEU and F100 both track international markets, the United Kingdom and Europe, to be specific. It is interesting to note that the European markets are hitting new highs at the same time that the UK-based F100 is.

Here on the ASX, it's no surprise to see IOZ and ILC at new heights, given the new record that the ASX 200 Index hit this morning. That was helped enormously by Commonwealth Bank of Australia (ASX: CBA)'s new record high itself, alongside multi-year highs for Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB).

So a great day for ETF owners. Let's see what tomorrow brings.

The post 12 ASX ETFs at new 52-week highs this Thursday appeared first on The Motley Fool Australia.

Moomoo market strategist Jessica Amir has helpfully picked out the three most common ones and set out why they shouldn't stop you from buying stocks right now:

1. 'It's too hard'

This could be the most heard excuse for inaction, especially from those who have never bought ASX shares.

Amir argues that this might have been true in the old days when everything was done on paper through human brokers, but it's now 2024.

"Buying a share is as easy as buying groceries, whether it's a domestic stock or from overseas," she said.

"Nowadays, trading fees from brokerages like Moomoo can start from as little as $1, so there's little financial barrier to investing."

There are also plenty of free educational resources on the internet to get started, including a host of articles from The Motley Fool's Education Hub, so there's no excuse to not invest.

"So don't be afraid to take the first step — these days, it's usually a free one!"

2. 'Now isn't a good time to invest in the stock market'

We've all heard this investing myth before.

When stocks are down, the haters say this citing poor investor sentiment. When stocks are bullish, the critics say this because they think it's all too expensive.

So when is a good time to invest?

Amir reckons people are missing the point when they talk about 'good' and 'bad' times to buy shares.

"As the saying goes in the investing world, it's not about timing the market, but your time in the market.

"The best step to investing is a small one, even if it's just a hundred dollars you put towards investing into a highly diversified ETF."

Having said that, she added 2024 was looking bullish.

"The Australian and US share market are at an all-time high and there is plenty of exuberance in booming industries across the globe.

"Interest rates are easing up this year so it's likely we will see more consumer spending and investors trading, which helps support our share market."

Amir noted earnings generally declined last year.

"So it may be likely that shares will be bouncing back this year."

3. 'There's too much choice'

There is no satisfying some people. 

Would they rather that there are insufficient choices?

Amir suggests that investors don't have to complicate the situation by researching deep into microcaps.

There is nothing wrong with blue chip stocks to get started.

"The S&P/ASX 200 Index (ASX: XJO) and the S&P 500 Index (SP: .INX) are great places for new investors to start. 

"Not only are you exposed to some of the highest-performing stocks in the share market, but they are regularly managed to stimulate a profit."

Even amid the volatility last year, you would have done well with well-known large-cap names.

"If you had invested $10,000 into the S&P 500 at the start of January 2023, you would have made over $2,400 by December 2023."

Amir named iShares S&P/ASX Dividend Opp ESG Screened ETF (ASX: IHD), Russell Inv High Dividend Australian Shares ETF (ASX: RDV) and BHP Group Ltd (ASX: BHP) as some popular names to get started on the ASX.

"BHP continues to make the nation go round, supplying domestic and global products for building iron scaffolds, buildings, cars, and infrastructures.

"With a 5-year growth of 34.7%, it's no wonder it's an investment choice often made by superannuation funds, fund managers and sophisticated investors."

The post 3 popular investing myths BUSTED appeared first on The Motley Fool Australia.

So, let's take a look at which ETFs investing in Australian shares did best in 2023 based on total returns (that is, share price gains and dividend returns combined).

For the purposes of this article, we're focusing on ETFs that invest in Australian shares only, and with a defined investment strategy. That means we're excluding index-based and sector-based ETFs.

These rankings are based on data just released by the ASX.

The top 5 ASX ETFs for total returns in 2023

There is a clear theme among the best ETFs of last year — environmental, social, and corporate governance (ESG).

According to the data, here are the top five ETFs:

iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD) returned 11.51% in share price growth and distributions over the 12 months of 2023.

iShares Core MSCI Australia ESG Leaders ETF (ASX: IESG) returned 10.73% in 2023.

Vanguard Ethically Conscious Australian Shares ETF (ASX: VETH) returned 9.98% in 2023.

Russell Investments Australian Responsible Investment ETF (ASX: RARI) returned 9.88% in 2023.

VanEck MSCI Australian Sustainable Equity ETF (ASX: GRNV) returned 9.83% in 2023.

EGS shares represent companies with good environmental, social, and governance credentials based on certain criteria.

In this era of climate change and decarbonisation, investors are increasingly seeking to support companies that are doing their bit to save the planet, so ESG stocks are becoming more popular.

More about the No. 1 ETF

According to ETF provider Blackrock, the iShares S&P/ASX Dividend Opportunities ESG Screened ETF invests in up to 50 ASX shares that offer high dividend yields and meet certain sustainability tests.

They also have to meet diversification, profitability and tradability requirements.

The IHD ETF closed at $13.88 per share on Thursday, up 0.58% for the day.

Among the top 10 holdings of the IHD ETF are major miners like BHP Group Ltd (ASX: BHP), big four banks including Commonwealth Bank of Australia (ASX: CBA), Telstra Group Ltd (ASX: TLS), Aurizon Holdings Ltd (ASX: AZJ), JB Hi-Fi Limited (ASX: JBH), and QBE Insurance Group Ltd (ASX: QBE).

The post Which ASX ETFs holding Aussie shares delivered the best returns in 2023? appeared first on The Motley Fool Australia.