The two I'm going to highlight are ones I have a double-digit allocation to (in percentage terms).

I expect the second ASX dividend share, if not both, will remain as large holdings for decades to come.

MFF Capital Investments Ltd (ASX: MFF)

This business is best known as a listed investment company (LIC) – I have liked this business and written about it for almost a decade. There's still a lot to like for dividend investors.

Firstly, it provides exposure to high-quality businesses from across the world, which should mean it can benefit from long-term compounding of earnings. MFF wants to invest in a portfolio of competitively advantaged businesses while avoiding permanent capital loss.

The investment returns have allowed the business to deliver impressive capital growth. Over the past five years, the MFF share price has risen by around 70%, excluding dividends. The total shareholder return (TSR) has been an average of 14.9% per year over the past five years.

One of its other main goals is to grow the dividend.

The ASX dividend share has increased its annual regular dividend each year over the past several years. It's expecting to increase its annual payout to 21 cents per share in FY26. I wouldn't be surprised to see the payout rise to at least 23 cents in FY27.

But the guided FY26 payout translates into a grossed-up dividend yield of 6.5%, including franking credits, at the time of writing.

I expect to buy more of this ASX dividend share in the coming weeks, particularly if it stays at around the current valuation.

Washington H. Soul Pattinson and Co Ltd (ASX: SOL)

Soul Patts is the largest position in my portfolio, and I'm planning to buy more if the share price dips.

The investment conglomerate has proven itself yet again during the last month as a leading business for stability. Since the end of February 2026, the Soul Patts share price has risen by 7%, compared to a fall of more than 6% by the S&P/ASX 200 Index (ASX: XJO).

I think one of the key reasons for this performance has been its large stake in ASX energy share New Hope Corporation Ltd (ASX: NHC), which has risen more than 20% since the end of February 2026.

But the ASX dividend share is invested in a variety of other defensive industries, including swimming schools, telecommunications, agriculture, water entitlements, and industrial properties.

Together, its portfolio can provide resilient cash flow, enabling the business to generate stable profit and pay a consistent (and growing) dividend.

It's impressive to think that the business has increased its regular annual dividend per share every year for 28 years in a row. The company has also paid a dividend each year since it listed more than 120 years ago.

I think the business is on course for a very compelling future as its portfolio continues to evolve and find greater investment opportunities. At the time of writing, it has a grossed-up dividend yield of 3.7%, including franking credits.

The post 2 ASX dividend shares I'm betting on big-time to fund my retirement appeared first on The Motley Fool Australia.

Each state has a different school holiday period, with NSW, Queensland, and Victoria among the states commencing holidays today.

Tasmania has the latest school holiday schedule this Easter season. The school break in our smallest state runs from 18 April to 3 May.

So, here's a list of all the ASX shares due to go ex-dividend over the coming weeks through to 3 May.

In order to receive a dividend, you must own the ASX share prior to its ex-dividend date.

Ex-dividend dates give ASX investors two opportunities.

Either buy before the date to receive the dividend, or wait until ex-dividend day, when the share price will likely drop, to buy then.

ASX shares with ex-dividend dates this month

The post 21 ASX shares going ex-dividend over the school holidays appeared first on The Motley Fool Australia.

MFF Capital is a listed investment company (LIC) that has been on the ASX for almost two decades. Despite a lack of publicity and fanfare, it has produced some exciting returns for investors ever since its listing.

Today, its sharers are looking compelling. MFF currently sports a trailing dividend yield of 4.09% (as of yesterday's closing price). So let's discuss whether this ASX stock is the best growth and income play on the ASX.

Like most LICs, MFF owns and manages an underlying portfolio of investments. In this case, that underlying portfolio consists mostly of US stocks, with some other international companies thrown in. MFF has always followed a Warren Buffett-insprired approach to investing. Its holdings tend to be mature, dominant companies that display signs of possessing a moat, or intrinsic competitive advantage that helps it stay ahead of competition. These companies are purchased at compelling prices, and held indefinitely for the benefit of MFF shareholders.

Some of MFF's largest positions have been in its portfolio for many years. They include the likes of Amazon, Mastercard, Alphabet, Visa, American Express, and Microsoft.

This strategy has paid off for MFF's long-term investors. By my calculations, investors have enjoyed an average total return (share price growth plus dividends) of about 12.1% per annum over the past ten years, and 15.05% per annum over the past five. On the latter metric, investors have received an average share price growth rate of 11.7% per annum.

Growth and income from this top ASX stock?

So we know MFF offers plenty of growth potential. But what about income?

Well, MFF has that in spades too, and is more potent that even its starting 4%-plus yield would indicate. As I've discussed before, MFF is one of the ASX's best dividend growth stocks. To prove it, let's go back through this ASX stock's recent dividend history. Back in 2017, MFF paid out 2 cents per share in fully-franked dividends to its shareholders. By 2021, the company was up to forking out 7.5 cents per share. Last year, it had hit 17 cents per share.

In 2026, the company has told investors to expect a total of 21 cents per share, up 23.5% from just 2025 levels if so. The trajectory of 2 cents per share to 21 cents per share in 2026 would come to an compounded annual growth rate of 26.4% per annum.

If this blistering dividend growth rate continues, it will be exceptionally lucrative for long-term investors.

All in all, I regard MFF Capital as one of the ASX's best performers in recent years, and a stellar investment, period. I am happy to hold it in my own portfolio, and equally happy to recommend it to any investor who is searching for growth and income today.

The post This 4% ASX stock is my top pick for growth and income in 2026 appeared first on The Motley Fool Australia.

MFF is a listed investment company (LIC), which is the core driver of shareholder returns. It also owns a separate funds management business (which was acquired) that is focused on providing international share funds to clients and gives MFF more research capabilities.

There are significant benefits for investors who want investment income, so let's run through those advantages.

Large and growing dividend yield

I'm sure many passive income seekers want to know about the dividend, so let's start there.

Impressively, its regular annual dividend has grown in consecutive years going back to 2018. Not many ASX dividend shares can point to a dividend record like that.

But, it's not just the dividend growth that's pleasing – the dividend yield is also very good.

The ASX dividend stalwart is expecting to pay an annual dividend per share of 21 cents in FY26.

At the time of writing, this translates into a forward grossed-up dividend yield of 6.5%, including franking credits.

If the business continues its growth pattern of increasing the payout by 1 cent per share every six months, that could translate into a forward grossed-up dividend yield of 7.2%, including franking credits in FY27.

Good investment process

MFF aims to take a "long-term view and focus on a select group of businesses that offer attractive combinations of quality and value, clear our high opportunity cost hurdle and create the potential for self-reinforcing growth."

The ASX dividend stalwart wants to take an investment mindset that focuses on duration and enables the power of compounding.

Its portfolio has around 25 holdings in some of the world's best listed businesses, ensuring that its portfolio can be fairly concentrated so that high-performing ideas can have a meaningful impact on the overall returns.

Diversification and strong total returns

MFF's portfolio has been constructed to have great ideas, but I believe they are from a sufficient number of sectors and countries to mean that the portfolio is diversified enough to not be at risk from any particular issue.

Some of the ASX dividend stalwart's biggest investments are across payment giants, US tech titans, retail, healthcare, banking and alternative asset and private equity fund managers.

MFF's investment strategy has clearly performed well for investors because it has delivered an average total shareholder return (TSR) of 15% per year over the past five years.

It looks good value to me after falling in recent weeks amid the Middle East uncertainty.

The post An ASX dividend stalwart every Australian should consider buying appeared first on The Motley Fool Australia.

I don't know how long the market will be feeling pessimistic about the Middle East and oil price situation – it could be days, weeks or even longer. Time will tell.

I prefer to buy at a better valuation while the opportunity is there, which is why I decided to pounce on the following ASX dividend at the start of this week.

MFF Capital Investments Ltd (ASX: MFF)

MFF is one of the larger listed investment companies (LICs) on the ASX, with a focus on quality international companies with above-average capabilities to compound earnings at a good speed over time. I don't usually invest in international shares directly, so I like using this as a dividend-paying option to get that exposure.

I think the MFF investment strategy has been very effective, as demonstrated by the fact that MFF has delivered an average total shareholder return (TSR) of 15.3% per year over the last five years, according to CMC Invest. Of course, past performance is not a guarantee of future performance.

One of the advantages of the LIC investment structure is that the board of directors have control over what size dividend they want to declare. The business is currently increasing its half-year payout by 1 cent per share every six months.

MFF plans to pay an annual dividend per share of 21 cents in FY26, which translates into a forward grossed-up dividend yield of 6.5%, including franking credits, at the time of writing.

I thought the dip in the MFF share price was appealing, offering better underlying value and a stronger dividend yield.

I expect the ASX dividend share to continue increasing its payout over time and owning high-quality businesses to help deliver capital growth.  

L1 Long Short Fund Ltd (ASX: LSF)

This is another LIC, which invests in a mixture of ASX shares and international shares, utilising a mixture of investing for the long-term and short selling.

I like how it has a track record of producing investment returns primarily through resource shares, industrial shares and communication shares. There are various ways to produce good returns, including in cyclical shares.

L1 likes to look at businesses that have lower price/earnings (P/E) ratios, which I think other investors may sometimes overlook. Under-researched and unloved ASX shares can be a smart choice to deliver good returns.

In the last five years, the ASX dividend share has returned a total shareholder return average of 16.5% per year over the last five years, according to CMC Invest. Again, past performance is not a guarantee of future performance.  

Pleasingly, the LIC has been steadily increasing its payout each year since 2021 and its latest two quarterly dividends for the FY26 half-year period was 13.6% higher than the FY25 half-year dividend. It currently has an annualised grossed-up dividend yield of 5.25%, including franking credits, at the time of writing.

I'm expecting the ASX dividend share to continue increasing its payout thanks to the large profit reserve it has built and the investment strategy it's using.

The post I invested thousands into these 2 ASX dividend shares this week appeared first on The Motley Fool Australia.

Although investors love dividends, paying them places an enormous burden on a company. Dividends are not free money. They are cash payments funded from a company's profits. Every dollar that goes out the door as a dividend is lost to that company forever. It cannot be used to pay taxes, reduce debt, or be reinvested in the business for future growth.

Many companies manage to afford to pay regular dividends to their investors. But only the best have the financial capacity to deliver regular dividend increases above the rate of inflation. If you find a company that can do this consistently, it has a high chance of being a long-term winner and market-beating investment. At least in my opinion.

When it comes to divided growth streaks, there are few ASX shares that can match MFF Capital Investments Ltd (ASX: MFF).

MFF Capital is a listed investment company (LIC) that specialises in investing in US stocks. Like most LICs, MFF holds a portfolio of underlying investments that it manages on behalf of its shareholders. MFF typically follows a Warren Buffett playbook of buying high-quality companies at attractive prices and holding them. Some of its most successful positions have been in its portfolio for years, and include Amazon, Google-owner Alphabet, Mastercard, Home Depot, American Express, and Visa.

This ASX stock is a dividend growth machine

But let's talk about this ASX stock's dividend growth. MFF happens to have one of the sharpest dividend growth trajectories on the ASX. To illustrate, MFF shares paid out 2 cents per share in fully-franked dividends back in 2017. By 2021, that annual total had grown to 7.5 cents per share. By 2025, it had reached 17 cents per share.

Recently, MFF has confirmed that investors will receive an interim dividend worth 10 cents per share, fully franked, in May. Just this week, the company told shareholders to expect a final dividend of 11 cents per share later this year. This, if all goes to plan, would see MFF's 2026 dividend total come in at 21 cents per share.

That would be a 23.5% rise over 2025's dividends in one go. It would also mean that investors have enjoyed a compounded annual growth rate (CAGR) in dividend payments of 26.4% over the past five years. Since 2017, the CAGR has been 29.86%. In contrast, Commonwealth Bank of Australia (ASX: CBA) paid out $4.29 in dividends per share in 2017, and $4.85 per share in 2025. And that didn't include a dividend hike every year in between.

MFF Capital has one of the best dividend growth streaks on the ASX. Certainly, one of the steepest. That's why I'm confident this ASX stock will continue to be a winner going forward.

At the time of writing, MFF shares are trading on a trailing dividend yield of 4.15%.

The post You won't believe this ASX stock's dividend growth appeared first on The Motley Fool Australia.

It's hard to say for sure how this will play out, including the question of the data centre roll-out (with pushback from certain communities stopping data centres from being built in their area).

I've deliberately focused on ASX share investments I have confidence in for the long-term, even if things do change. I can sleep well with these businesses.

MFF Capital Investments Ltd (ASX: MFF)

Both of the businesses that I'm going to highlight can give investors sector exposure flexibility.

MFF is an investment business called a listed investment company (LIC). It has the mandate to look across the world for opportunities to invest in. That gives it a wide search zone for finding good ideas.

It's not forced to hold a certain shares in an index, regardless of whether or not their outlook is challenging. MFF aims to own competitively advantaged businesses with good potential for longer-term earnings growth. It can buy shares it likes and sell out of businesses that it no longer wants to own.

This strategy has resulted in MFF owning investments like Alphabet, Amazon and Meta Platforms. These are some of the businesses that are at the forefront of developing and offering AI. In other words, they could potentially be beneficiaries of AI.

Regardless of how things may change with AI, MFF can put its money towards areas of the market that it believes have a promising long-term future.

I like that it's paying a growing dividend because that means I can benefit from owning shares and the increasing underlying value without having to sell the shares.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is another ASX share that I have a high sense of security with.

It's an investment house that has been operating for 120 years. Over the years, it has divested a number of its holdings, but it has also made numerous investments to diversify its portfolio.

I like the ASX share's portfolio with how it's invested in a number of areas that are fairly unrelated to AI and technology. It's invested in areas like resources, telecommunications, agriculture, swimming pools and more. The company is also invested in a uranium miner, which could benefit from the growth in energy demand.

The business has already been around for decades and I think it will be around for decades to come thanks to the investment flexibility and how it focuses on assets with defensive cash flows.

Soul Patts also steadily grows its dividend for shareholders, which is a pleasing way to remain invested for the long-term in the business and benefit from increasing profits without needing to sell any shares.

The post Why I'm betting big on these 2 ASX shares in the age of AI appeared first on The Motley Fool Australia.

I think the stock market is the best hunting zone to find names that can pay a good dividend yield, deliver capital growth and organically raise the passive income. Other non-share investments just don't seem as appealing on that side of things.

If I'm investing for passive income, which I regularly do, I want to focus on investments that can give me a high level of confidence that they're going increase the payout annually for the foreseeable future.

I really like the three ASX dividend shares below for dividends and potential capital growth. Let's dive into why I'd happily spread $10,000 across them.

MFF Capital Investments Ltd (ASX: MFF)

MFF Capital is mostly a listed investment company (LIC), but also has a new funds management segment called Montaka.

The main way MFF makes profit for shareholders is by holding a portfolio of high-quality global shares that are expected to compound earnings in the coming years. By just investing in the best businesses in the world, it has produced solid returns which have helped it fund growing dividends to MFF shareholders.

It also recently acquired Montaka to give MFF access to more investment ideas and research, while also unlocking another earnings growth avenue. A rise in the fund size of Montaka Global Fund – Active ETF (ASX: MOGL) and Montaka Global Extension Fund – Complex ETF (ASX: MKAX) helps generate management fee earnings for MFF.

MFF has guided it's going to pay an annual dividend per share of 21 cents in FY26, which translates into a grossed-up dividend yield of 6.1%, including franking credits, at the time of writing. That means the ASX dividend share is expecting to increase its FY26 dividend by more than 20% year-over-year.

WCM Global Growth Ltd (ASX: WQG)

WCM Global is another LIC with an impressive record of portfolio performance and dividend growth.

The investment team at WCM – based in California's Laguna Beach – aim to look for businesses with an expanding economic moat/improving competitive advantages. The LIC also wants to find businesses that have a corporate culture that fosters the improvement of that economic moat.

Its portfolio mix of US shares and international shares provides investors with diversified holdings, along with compelling potential to deliver returns.

By investing in those high-quality names, WCM Global Growth has managed to outperform the global share market return, whilst paying a rising dividend over the last several years.

The ASX dividend share expects to pay an annual dividend in FY26 that equates to a grossed-up dividend yield of 6.7%, including franking credits, at the time of writing.

Washington H. Soul Pattinson and Co Ltd (ASX: SOL)

I couldn't write this article without mentioning the leader of dividend growth on the ASX, Soul Patts.

It's an investment conglomerate that has already been listed on the ASX for more than 120 years and it hasn't missed paying a dividend in all of that time. Additionally, the business has increased its regular annual payout every year since 1998, which is an incredible record for an ASX dividend share.

The business has built an impressive and largely uncorrelated portfolio across a variety of defensive sectors that can provide cash flow for the business in most economic conditions, giving resilient funding for the growing dividend. The ASX dividend share regularly invests to expand its portfolio and boost its long-term growth potential. I'm forecasting that Soul Patts could pay an annual dividend per share in FY26 that at least translates into a grossed-up dividend of 4.2% (if not more), including franking credits, at the time of writing.

The post Where I'd invest $10,000 into ASX dividend shares right now appeared first on The Motley Fool Australia.

After all, the markets go up far more often than they go down. And, seeing as the ASX 200 has never failed to exceed a previous all-time high in its long history, logic dictates that we shouldn't just buy shares when there is a rare stock market correction or crash. Even if these events are often the best opportunities to buy top-quality shares at cheap prices.

With that in mind, let's discuss a few ASX shares that I would buy in 2026 if I stumbled onto a $10,000 windfall.

3 top ASX shares to buy with $10,000 in 2026

First up is MFF Capital Investments Ltd (ASX: MFF). MFF is a listed investment company (LIC) that specialises in buying high-quality US stocks at cheap prices. It takes a Buffett-esque long-term approach in this endeavour, with many of its largest holdings owned for many years. These include the likes of Amazon, Alphabet, Mastercard, Visa and American Express.

MFF has a long history of delivering solid performance for its investors, and has one of the best dividend growth track records around. I'd happily buy more of MFF with that $10,000.

I would also take a look at Washington H. Soul Pattinson and Co Ltd (ASX: SOL). Soul Patts is a diversified investing house that owns and manages a vast underlying portfolio of assets on behalf of its shareholders. These assets are mostly high-quality ASX shares, but also include property, private credit and other investments. Soul Patts has a long history of delivering market-beating returns and has delivered decades of consistent dividend growth for its shareholders.

If you're still not convinced MFF or Soul Patts is a good choice for our $10,000, a final choice to consider is TechnologyOne Ltd (ASX: TNE). This ASX tech stock has been growing at breakneck speed for years. Last November, it reported earnings per share (EPS) growth of 16%, profit growth of 17% and a whopping 55% surge in free cash flow.

Understandably, this stock has long traded at a very expensive valuation. But TechnologyOne has been caught up in the software scare that has hit global markets in recent weeks and is down considerably from last year's record highs. Although this top ASX share has rebounded since the new 52-week low we saw earlier this month, it is still worthy of a look if you're looking for a top stock to put that $10,000 in.

The post Top ASX shares to buy with $10,000 in 2026 appeared first on The Motley Fool Australia.

I'm investing in businesses that I think can generate strong total shareholder returns (TSR) – that's the combination of dividend payments and the capital growth combined.

A growing business can provide rising payments because it's the profit that funds the dividend payments, in accounting terms. A business I've recently invested in is MFF Capital Investments Ltd (ASX: MFF).

It's not the first time I've invested in this ASX dividend stock and it won't be the last. Additionally, Chris Mackay, the leader of the business, recently bought shares too. I think it's a good buy signal for us when Mackay (a very skilled investor) decides to buy MFF shares, suggesting the business is good value.

Strong ASX dividend stock credentials

The business has a great history of strong dividend growth over the last several years. Its regular annual dividend per share has increased each year since 2018, which I think is an impressive record.

But, it's not just the fact that the dividend has been rising. It has been soaring higher.

In the last several results, it has increased its annual dividend per share by 1 cent compared to the result six months before (and a 2-cent per share increase year-over-year).

In the FY26 half-year result, MFF grew its half-year payout to 10 cents per share (a 25% increase year-over-year).

The ASX dividend stock is expecting to increase its FY26 final dividend per share to 11 cents per share, a year-over-year increase of 22%.

That means the FY26 annual dividend translates into a potential grossed-up dividend yield of 6.3% (at the time of writing), including franking credits. I think that's a great starting point for a yield and the business seems determined to continue raising the payout in the coming years.

Great set up for investment returns

MFF's main operation is acting as a listed investment company (LIC) that invests in a portfolio of high-quality, mostly international shares.

The business aims to invest in advantaged businesses that, in MFF's view, have "high probabilities of maintaining their competitive advantages and achieving above average levels of profitable growth over the medium to long term."

It usually owns these high-quality businesses for the long-term while also seeking new opportunities that it considers to be advantaged "over the long term and offer attractive investment fundamentals."

At the end of January 2026, the ASX dividend stock's largest positions included Alphabet, Mastercard, Visa, Meta Platforms, Bank of America and Amazon.

Pleasingly, over the past ten years, its post-tax net tangible assets (NTA) return (including franking credits) has been an average of 14% per year – that's a useful measure of the portfolio's investment performance.

Additionally, MFF recently acquired a fund manager called Montaka. This broadened the investment team and unlocked more research insights, reducing the key person risk of relying solely on Chris Mackay. Additionally, if Montaka's funds under management (FUM) grows, this can boost MFF's earnings.   

Overall, I think this is a great dividend-paying business to own for the long-term.

The post Why I just bought this 6%-yielding ASX dividend stock and plan to buy even more appeared first on The Motley Fool Australia.

What did MFF Capital Investments report?

• Total revenue and other income fell 44% to $308.9 million (Dec 2024: $551.8 million)
• Net profit after tax was down 45% to $209.7 million (Dec 2024: $381.5 million)
• Pre-tax net tangible assets (NTA) increased to $5.279 per share, up from $5.021 at 30 June 2025
• Post-tax NTA rose to $4.432 per share (30 June 2025: $4.167)
• Fully franked interim dividend declared at 10 cents per share, with intention to raise the next dividend to 11 cents
• Net assets up 7% to $2.61 billion over the half-year

What else do investors need to know?

MFF's board flagged its intention to further increase the next six-monthly dividend payment to 11 cents per share, supported by healthy franking credit reserves. The company's net assets at 31 December 2025 grew to $2.61 billion, reflecting steady capital appreciation despite a year of choppy global equity markets and a weaker US dollar impacting reported profits.

During the half, MFF made investments to become fully autonomous following the end of its long-term service arrangements with Magellan. The firm now operates with a team of 17 and has internalised all key operational and investment management functions, seeking long-term compounding for shareholders.

What's next for MFF Capital Investments?

Looking ahead, MFF aims to deliver sustained growth in net tangible assets and dividends. The company is positioned for future growth, having completed the transition to operational independence and invested in expanding in-house capabilities. MFF states its focus remains on holding a concentrated portfolio of high-quality global companies and seeking enduring capital growth through disciplined, long-term investing.

MFF will continue to keep shareholders informed with regular NTA updates, noting that returns will reflect ongoing market volatility and currency movements. The next dividend uplift is flagged for the period to June 2026, backed by a substantial franking credit balance.

MFF Capital Investments share price snapshot

Over the past 12 moths, MFF Capital Investments shares have declined 1%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 6% over the same period.

View Original Announcement

The post MFF Capital Investments results: Profit falls but dividend rises for H1 FY26 appeared first on The Motley Fool Australia.

Australian companies are capable of providing investors with dividends (and franking credits), unlocking a pleasing level of income for those who want it.

Every business that pays a dividend has a dividend yield, so we can work out how much we'd need to invest to unlock a desired level of income, such as $500 per month or $6,000 per year.

How to generate $500 of monthly income

Receiving $6,000 of annual passive income is a worthy goal – it's a sizeable level of cash each year.

How much money it would require essentially depends on the dividend yield of the portfolio.

For example, if the portfolio had a 6% dividend yield, then it would take a portfolio value of $100,000 to generate $6,000 of annual passive income.

With a portfolio dividend yield of 5%, the required portfolio value is $120,000.

A portfolio dividend yield of 4% would mean a portfolio value of $150,000 is needed.

If the portfolio dividend yield was 3%, then you're talking about needing a portfolio value of $200,000.

Clearly, all of those figures would require quite a lot of investment cash.

It's important to note that the higher dividend yields may not be as 'safe' as lower dividend yields.

Additionally, I wouldn't expect as much growth from high-yielding shares compared to lower-yielding ones over time. This is because a high yield indicates a high dividend payout ratio, with reduced cash held by the business for growth investing. A lower price/earnings (P/E) ratio also suggests the the market isn't assigning much value to growth opportunities.

Benefit from compounding

We don't need to come up with all of that cash ourselves to invest for the passive income.

Aussies can regularly invest into the ASX share market and let compounding grow the portfolio balance for you. The longer you let your money grow, the less you need to invest yourself. Names like MFF Capital Investments Ltd (ASX: MFF) and Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) springs to mind as ideas for this tactic.

For example, if someone were to invest $1,000 per month and it returned an average of 10% per year (the historical long-term average return of the ASX share market), it would grow into $100,000 after seven years, $150,000 after nine years and $200,000 within 11 years.

That shows that an investor starting with nothing could start generating useful passive income for their life fairly quickly. Today is a great day to get started.

The post Passive income: How much do you need to invest to make $500 per month? appeared first on The Motley Fool Australia.

The best dividend businesses can provide investors with both a good dividend yield and capital growth over time.

I consider the three ASX dividend shares below as three of the best options – I thought that five years ago, I think that today, and I'm confident they will be great dividend income picks in five years.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

I view Soul Patts as one of the very best passive income businesses because of the incredible dividend growth streak it has provided.

Soul Patts has increased its regular annual payout every year since 1998. No other ASX share has a growth streak that started in the previous century.

On top of that, the investment house has paid an annual dividend every year since it listed more than 120 years ago, including through world wars, global pandemics and economic recessions.

This S&P/ASX 200 Index (ASX: XJO) share doesn't rely on one core activity for its earnings – it has a diversified portfolio across a range of ASX shares, privately-owned businesses, property and credit. It has maximum investment flexibility to find the best opportunities with its money and create a portfolio that generates cash flow in all economic conditions.

I'm expecting the ASX dividend share's FY26 payout to be a grossed-up dividend yield of around 4%, including franking credits, at the time of writing.

They are the key reasons why I've made this business my largest ASX dividend shareholding.  

Future Generation Australia Ltd (ASX: FGX)

I've held this listed investment company (LIC) in my portfolio for several years and I expect it be a holding for many years to come.

There are multiple reasons to like the LIC. For starters, there are no management fees involved – instead, it donates 1% of its net assets each year to youth charities. It's invested in a variety of funds from different fund managers who all work for free to enable those charitable donations.

The fact it's invested across more than ten funds means it provides investors with significant diversification across hundreds of underlying holdings.

In terms of being a top ASX dividend share, it has grown its annual payout every year for the last decade and currently offers investors a grossed-up dividend yield of 7.7%, including franking credits, at the time of writing.

MFF Capital Investments Ltd (ASX: MFF)

MFF built a reputation as one of the leading LICs on the ASX by investing in a portfolio of high-quality shares, namely some of the leading global US tech shares and payment giants.

The business recently expanded into funds management by making an acquisition, giving it another growth avenue and providing more investment team capabilities to MFF.

One of its main goals is to increase its dividend each year. It has hiked regular payout each year over the last several years at an impressive double-digit rate thanks to the strong performance of its portfolio.

I'm predicting MFF will increase its annual payout to 21 cents per share in FY26, translating into a forward grossed-up dividend yield of 6.2%, including franking credits, at the time of writing.

The post 3 of the best ASX dividend shares to buy for income appeared first on The Motley Fool Australia.

We can only generate so much in earnings when we work for money. It's owning assets that help unlock that next phase of income creation.

I like to think of the ASX share market as the ASX business market – we can invest in great companies that are doing their best to make money for us, including paying dividends.

I'm using the three names below to build a second income for my own finances, and I want to highlight them for anyone wanting to build a second income with dividends.

MFF Capital Investments Ltd (ASX: MFF)

There are not many ASX investments that offer investors exposure to some of the world's best businesses and have a good dividend yield.

Companies are allowed to declare the size of dividend they want to, as long as they have the accounting profit reserve for it. That's one of the main reasons why investment businesses – namely listed investment companies (LICs) – can provide such consistent passive income for investors. The years of good investment profits can pay for ongoing dividends even when share markets are weak.

MFF has grown its normal annual dividend per share every year over the past several years. It owns some of the best global tech stocks, payment giants and other businesses with compelling futures in its portfolio.

I like the flexibility that the ASX share can invest in any business on the ASX or globally, which should help create good investment returns. I'm expecting its grossed-up dividend yield for FY26 to be at least 6%, including franking credits, at the time of writing's valuation. That's a great start for a second income.

L1 Long Short Fund Ltd (ASX: LSF)

This is another LIC – it invests in both ASX shares and global shares, utilising normal investing and short-selling strategies. L1 Long Short Fund typically looks to invest in undervalued businesses with relatively low price/earnings (P/E) ratios.

Past performance is not a guarantee of future performance. I think that disclaimer is particularly relevant when it comes to looking at the LIC's investment performance. Over the past five years, its portfolio's average annual net return was 18%.

That level of return is enough for the ASX share to provide growing dividends and capital growth.

Its payout has increased each year since 2021 and its latest quarterly dividend translates into a grossed-up dividend yield of 4.6%, including franking credits, at the time of writing. That's a solid yield for building a second income.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

This business isn't strictly a LIC, but it is a listed company that generates a lot of earnings through investing.

It's an investment house that invests in a wide range of listed businesses, as well as owning private businesses.

Soul Patts has private investments in industrial property, building products, agriculture, swimming schools, electrification, retirement living, water rights and financial services.

The company has investments in ASX shares like New Hope Corporation Ltd (ASX: NHC), Tuas Ltd (ASX: TUA), TPG Telecom Ltd (ASX: TPG), Electro Optic Systems Holdings Ltd (ASX: EOS), Aeris Resources Ltd (ASX: AIS) and Nexgen Energy (Canada) CDI (ASX: NXG).

By utilising the cash flow of the dividend payments from its investment portfolio, Soul Patts is able to pay a growing dividend and invest in new opportunities for the portfolio.

Soul Patts has increased its annual dividend every year since 1998. That's a wonderful record and the company wants to keep going for the foreseeable future, making it a wonderful pick for a second income.

I predict its grossed-up dividend yield in FY26 will be at least 4%, including franking credits, at the time of writing.

The post Don't want to rely on your wage? Build a second income with these ASX shares appeared first on The Motley Fool Australia.

I'm expecting all three businesses I'm going to highlight to increase their payouts in 2026 and, hopefully, beyond.

On top of that, all three ASX dividend shares are likely to provide shareholders with a compelling dividend yield that's better than savings in the bank.

Charter Hall Long WALE REIT (ASX: CLW)

The first business I want to highlight is a real estate investment trust (REIT) that owns a diversified portfolio of properties across a variety of sectors, including Bunnings properties, hotels, service stations, telecommunications exchanges, data centres, distribution centres, and more.

The business has built a portfolio that has long rental agreements with tenants. At June 2025, its weighted average lease expiry (WALE) was approximately nine years, giving investors pleasing rental security.

It's benefiting from steady rental growth with either fixed annual increases or inflation-linked increases, which has helped it provide guidance that its distribution will increase to 25.5 cents per security in FY26. This would be a distribution yield of 6.4% at the time of writing.

MFF Capital Investments Ltd (ASX: MFF)

This business is best-known as a listed investment company (LIC) which invests in a high-quality portfolio of international stocks that are likely to deliver compounding profits for the foreseeable future.

MFF can translate the investment profits that it makes into a rising dividend thanks to the company's structure and the ability of the board of directors to decide on the level of the passive income.

The ASX dividend share has been steadily increasing its regular dividend per share over the past several years, and the company expects to increase its biannual dividend to 10 cents per share, implying a grossed-up dividend yield of at least 5.9% for FY26, including franking credits, at the time of writing.

I believe the portfolio's investment returns can continue to perform well thanks to numerous strong businesses, including compelling recent additions.

Coles Group Ltd (ASX: COL)

Food retailing is one of the most defensive industries on the ASX, in my opinion. Coles has an important role in Australian society, and it's doing better than Woolworths Group Ltd (ASX: WOW) at growing sales thanks to its product offering.

Coles has invested significantly in new automated distribution centres and customer fulfilment centres, which should help improve its margins, efficiencies, product freshness, and e-commerce offering.

The completion of those assets should help the ASX dividend share's earnings and cash flow, helping fund larger passive income in the coming years.

The projection on CommSec suggests the business could pay an annual dividend per share of 79 cents in FY26. That translates into a potential grossed-up dividend yield of 5.3% at the time of writing, including franking credits.

The post 3 top ASX dividend share buys for passive income in February appeared first on The Motley Fool Australia.

Many investments available on the ASX (and internationally) pay dividends, as they share profits with shareholders each year. With shares, you don't need to deal with tenants, leasing agents or repairs.

It's easy to take a back seat with shares; that's why I think it's the best form of passive income.

Businesses aren't like term deposits – they can grow earnings, increase dividends, and increase share prices. Some businesses on the stock market can provide a better yield than savings accounts straight away.

The power of a dividend yield

If we put $1,000 into a bank account earning 4% interest, we'd expect to earn $40 in annual income.

Investing in stocks comes with different dividend yields. The higher the dividend yield, the more money investors will get. The highest yields (of 10% or more) aren't necessarily safer, though.

Telstra Group Ltd (ASX: TLS) is an example of a good ASX dividend share. Telstra's annual payout last year was 19 cents per share, which translates into a 4% cash dividend yield. Franking credits boost the after-tax effect of receiving the dividend (often leading to tax refunds). Including franking credits, Telstra's FY25 payout equated to a grossed-up dividend yield of 5.75%.

At the current Telstra share price, a $1,000 investment would yield $57.50 in passive income in FY25.

I think there's a good chance Telstra will increase its payout to 20 cents per share in FY26, which would yield just over $60 of grossed-up passive income (including franking credits). That's an increase of around 5%.

Savings in the bank account don't grow like that. You can leave the cash in there (and not utilise the interest), but investors can also reinvest their dividends to accelerate wealth-building.

It also shows how making a $1,000 investment can snowball into more passive income for investors.

There's more to the stock market than just Telstra shares, of course.

The stock market is a money-making machine for passive income

Some ASX-listed businesses have a record of growing their dividends every year for 20 years in a row, like Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) and APA Group (ASX: APA).

There are some investments with very high dividend yields (over 9%) that haven't given any payout reductions (though payout growth is slow), such as Shaver Shop Group Ltd (ASX: SSG) and WAM Microcap Ltd (ASX: WMI).

There are a number of other ASX dividend shares that are appealing as passive income options like MFF Capital Investments Ltd (ASX: MFF), L1 Long Short Fund Ltd (ASX: LSF), Pinnacle Investment Management Group Ltd (ASX: PNI), Universal Store Holdings Ltd (ASX: UNI), Charter Hall Long WALE REIT (ASX: CLW), Centuria Industrial REIT (ASX: CIP), Rural Funds Group (ASX: RFF) and WCM Quality Global Growth Fund (ASX: WCMQ).

Many of the above investments offer a dividend yield of 5% or more, which is appealing in my book.

Receiving $12,000 annually (or $1,000 per month) at a dividend yield of 5% would require a $240,000 portfolio.

That portfolio goal may sound like a lot, but if an investor invested $1,500 per month and their portfolio returned an average of 10% per year (the long-term average of the share market), it would only take around nine years to reach $240,000. It just takes investing in the right stocks.

The post Here's how you could turn the stock market into a $1,000 monthly passive income machine appeared first on The Motley Fool Australia.

Choosing those shares is the hard part, of course. With so many options on the ASX alone, it can be overwhelming to sift through the wheat to find the proverbial chaff.

To make things easier, I've concocted a simple, three-stock ASX share portfolio that I think any investor, beginner or veteran, can construct with confidence if they are hoping to build long-term wealth.

A simple ASX stock portfolio for building wealth

First up, investors can consider investing in Argo Investments Ltd (ASX: ARG). Argo is a listed investment company (LIC). This means it holds an underlying portfolio of investments, which the company manages on behalf of its shareholders. In Argo's case, these underlying investments are mostly blue-chip ASX shares, ranging (as of 31 December) from BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA) to Santos Ltd (ASX: STO) and Aristocrat Leisure Ltd (ASX: ALL).

Since Argo manages this portfolio, investors can sit back and forget about buying and selling the right ASX shares. In this way, Argo is a fantastic choice for investors who want to invest in Australian shares but are happy to outsource the hard work.

In that vein, MFF Capital Investments Ltd (ASX: MFF) is a complementary investment to Argo. MFF is another LIC. Instead of holding a portfolio of Australian shares, it opts for the best stocks on the American markets to build wealth for shareholders. MFF has always followed a long-term buy-and-hold mindset. Many of its largest holdings, including Meta Platforms, Google owner Alphabet, Mastercard, and American Express, have been in its portfolio for years.

Adding companies of this world-leading calibre to a portfolio is, in my view, a great way to complement Argo's Australian blue chips.

Our final investment is another inherently diversified, passive-friendly choice. It is the Vanguard Diversified High Growth Index ETF (ASX: VDHG). This exchange-traded fund (ETF) is really a collection of different index funds. It offers investors exposure to the entire ASX, as well as international markets, emerging markets, and international small companies. It also has a small allocation to fixed-interest investments.

This 'ETF of ETFs' is a highly diversified passive investment that offers exposure to almost all corners of global markets.

Foolish takeaway

This simple three-stock portfolio may suit an investor looking to passively build wealth using stocks. You are getting some of the ASX's most reliable blue-chip shares through Argo. MFF complements them with some of America's best companies, while Vanguard's VDHG ETF adds a layer of diversification to the mix. If I were starting an investing journey in 2026, dividing your capital equally between these three investments would, at least in my view, be a good place to start building wealth.

The post Any ASX investor can use this simple 3-stock portfolio to build wealth appeared first on The Motley Fool Australia.

The investment I want to highlight in this article has risen by around 90% over the past five years and has also provided strong dividends to shareholders.

That business is MFF Capital Investments Ltd (ASX: MFF). I've made it one of the largest positions in my portfolio for a few very good reasons. So, let's get into why it's a compelling idea.

Great ASX dividend stock credentials

The business has a goal of increasing its dividends for shareholders over time. It has been very successful with this goal over the last several years.

MFF has increased its annual ordinary dividend each year since 2017.

Pleasingly, it has increased the half-yearly dividend by 1 cent per share every six months, going back to October 2023. The latest two payments were 9 cents per share from the FY25 annual result and 8 cents per share with the FY25 half-year result.

If it continues this trend and declares a 10-cent per share dividend next month (February) and an 11-cent per share dividend in August, it will have a grossed-up dividend yield of around 6% this year, including franking credits. That would represent a year-over-year increase of 23%.

I'm expecting plenty of dividend growth in subsequent years because of the large profit reserve and good investment track record.

Excellent portfolio process

MFF has a fabulous track record of delivering long-term returns with its portfolio that is largely focused on high-quality global stocks.

The ASX dividend stock has had names like Visa, Mastercard, Alphabet, Amazon, and Microsoft in the portfolio for years. Recent investments include L1 Group Ltd (ASX: L1G) and KKR, which could be great ideas for the long term.

MFF targets great businesses with strong compounding potential with above-average prospects.

Some investments out there have a much larger risk of not working out than others, and MFF has a good track record of avoiding those sorts of duds, even if it means missing out on the occasional Nvidia-type business.

According to CMC Markets, MFF has delivered an average total shareholder return (TSR) of 18% per year over the last five years. I think that's a good proxy for its portfolio performance in that time.

It trades at a discount

Isn't it great when we go into a shop, and the item we want is cheaper than we expected? In my view, MFF is trading at a very appealing value.

Every week, MFF tells investors what its underlying value is with its pre-tax net tangible assets (NTA). At the time of writing, the MFF share price is trading at a 9% discount to the latest weekly NTA figure.

While the discount has been larger in the past, I think it's still a very attractive value to buy this ASX dividend stock.

The post Why this could be the best ASX dividend stock to buy today appeared first on The Motley Fool Australia.

I like the idea of owning a diversified portfolio of ASX stocks, but many of the available businesses have operations focused on Australia (and New Zealand). There's not much geographic diversification for the earnings.

MFF offers everything I'm looking for, which is why I've made it one of the largest passive income investments in my portfolio.

Let me explain further.

Excellent diversification

When we buy many ASX shares, we're buying a small slice of a single business.

MFF's main value is concentrated in a portfolio of global shares. One of MFF's main goals is medium-term compounding and seeking to avoid permanent capital losses.

Its portfolio includes a number of excellent businesses that have global earnings with incredible economic moats such as MasterCard, Alphabet, Visa, American Express, Meta Platforms, Amazon, Home Depot and Microsoft.

MFF's portfolio has a strong track record of performance. Winners have a habit of winning over the long-term, particularly if they continue investing in their products/services.

I'm excited by the long-term potential of MFF's portfolio and how this can drive the overall shareholder returns for investors.

MFF's ability to generate investment returns plays a big part in the attractiveness of its passive income.

Passive income of $1,000 per year

Pleasingly, the business has a very good record of paying dividends to investors. It has increased its regular annual dividend each year between 2017 and 2025. Not many large ASX stocks can say that.

MFF's other main goal is to increase its fully franked dividend over time and I'm confident the business will increase its payout in FY26.

The ASX stock has a strong track record of growing its payout at a strong rate over the last several years. In FY25 alone, the business decided to increase its annual dividend by just over 30% to 17 cents per share.

But, for my calculation of receiving $1,000 of passive income, I'm going to use the payout figure from FY25.

To receive $1,000 of annual cash passive income with the 17 cents per share, we'd need 5,883 MFF shares. But, if we include the franking credits as part of that income goal, we'd only need 4,118 shares.

The ASX stock still trades at decent value

Is this a good time to invest? The business regularly tells investors about its underlying value regularly.

At 9 January 2026, it had approximately $5.40 of pre-tax net tangible assets (NTA). At the time of writing, it's trading at an attractive single-digit discount to this valuation. I like being able to buy shares for less than they're worth.

The post I'd buy 5,883 shares of this ASX stock to aim for $1,000 of annual passive income appeared first on The Motley Fool Australia.

In practical terms, this might look like deciding between ANZ Group Ltd (ASX: ANZ)'s 4.65% dividend yield and the 0.33% that WiseTech Global Ltd (ASX: WTC) currently offers investors (at the time of writing).

Most ASX dividend shares fall into one of these two buckets. But there are rare exceptions to this would-be rule. And those exceptions often present the best passive income opportunities.

I think MFF Capital Investments Ltd (ASX: MFF) is one of those opportunities. MFF is a listed investment company (LIC). Like most LICs, MFF owns an underlying portfolio of assets that it manages on behalf of its shareholders. This portfolio consists mostly of high-quality US stocks that have been held for years and allowed to compound. Some of its top holdings include Google-owner Alphabet, Mastercard, Home Depot, and American Express.

Dividend growth or high passive income? This ASX share might offer both

This Warren Buffett-like approach to investing has paid off well for MFF. We can see this impressive performance codified in MFF's dividend growth history. This passive income payer doled out 2 cents per share back in 2017. But by 2025, this had risen to 17 cents per share. As we discussed earlier today, dividends inherently weaken a company. Only the best stocks can afford to increase their payouts by a compounded average growth rate of 30% per annum, as MFF has over the past eight years.

That growth rate would handily qualify MFF as a low-yield, high-growth dividend stock. Yet, MFF's shares trade on a healthy trailing dividend yield of 3.3% today. That comes with full franking credits attached, too.

No, there's no guarantee that MFF will continue to grow its payouts as aggressively as it has in recent years going forward. However, I think past performance indicates that MFF's investing strategy is a sound one, and future dividend increases are likely. The company has already told investors to expect a 25% hike to 10 cents a share for its first dividend of 2026.

As such, I believe the current MFF share price presents a rare opportunity to secure a passive income share with a substantial starting dividend yield that could potentially grow its dividends at a rapid pace going forward.

The post Why this 3.3% dividend yield might be a rare passive income opportunity appeared first on The Motley Fool Australia.