The easy way to earn $1,000 a month in dividends from the ASX

This is an easy way to generate monthly income from the share market.

| More on:
Happy man holding Australian dollar notes, representing dividends.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Who says building a reliable income stream has to be complicated?

For investors chasing passive income, the ASX offers a surprisingly simple solution — and with the right mix of dividend-paying shares, you could be earning $1,000 a month (or more).

$1,000 a month from ASX dividend shares

Firstly, it is worth noting that to generate $1,000 a month, or $12,000 per year, in dividends you will need a sizeable portfolio.

Based on an average dividend yield of 5%, you would be looking at a portfolio value of roughly $240,000.

Now, before you scroll away — remember, this isn't about getting rich overnight. It is about building a solid, sustainable income stream over time. If you're already part of the way there, great. If not, this strategy can help you get on track.

Start with growth

It may seem counterintuitive to skip dividends to begin with when your aim is to build a monthly income stream.

However, unless you're already sitting on a sizeable nest egg, you are going to have to build up your investment portfolio to be able to generate income.

Based on a return of 10% per annum, which is in line with historical averages but not guaranteed, investors could build a $240,000 portfolio in just over 11 years by investing $1,000 per month.

Switch to quality dividend payers

Once you have a portfolio of the desired value, it is time to start thinking about passive income.

If you're going to rely on dividends, the businesses behind them matter. You want companies with strong balance sheets, consistent cash flow, and a track record of paying (and ideally growing) dividends.

Here are a few examples of ASX dividend shares that could form the backbone of a winning income strategy and could be worth further investigation:

  • HomeCo Daily Needs REIT (ASX: HDN) — A property trust focused on essential retail, paying steady distributions with income paid quarterly.
  • Smartgroup Corporation Ltd (ASX: SIQ) — A strong dividend payer with yields around 8% and a client base that includes government and not-for-profits.
  • Super Retail Group Ltd (ASX: SUL) — Owner of Rebel, BCF and Supercheap Auto, with fully franked dividend yields approaching 5% based on current analyst forecasts.
  • Telstra Group Ltd (ASX: TLS) — Defensive earnings, consistent dividends, and exposure to growth in mobile and data infrastructure.
  • Universal Store Holdings Ltd (ASX: UNI) — A top dividend stock with growth potential, offering fully franked yields over 4% and still expanding its store footprint.

This mix spreads your income across sectors — telecoms, retail, property, and services — reducing reliance on any one company or industry.

Foolish takeaway

You don't need to overthink it. With patience, a clear goal, and the right mix of dividend-paying shares, building a $1,000 a month income stream is well within reach. And perhaps much sooner than you thought possible, even when starting at zero.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the 'five best ASX stocks' for investors to buy right now. We believe these stocks are trading at attractive prices and Scott thinks they could be great buys right now...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor James Mickleboro has positions in Universal Store. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Super Retail Group. The Motley Fool Australia has positions in and has recommended Smartgroup, Super Retail Group, and Telstra Group. The Motley Fool Australia has recommended HomeCo Daily Needs REIT. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Dividend Investing

Middle age caucasian man smiling confident drinking coffee at home.
Dividend Investing

Buy BHP, Telstra, and this ASX dividend share

Brokers are tipping these shares as buys for income investors. But why?

Read more »

The letters ETF sit in orange on top of a chart with a magnifying glass held over the top of it
Dividend Investing

Boosting passive income: With a 7.6% yield, is the YMAX ETF a good option?

Is this ETF's yield too good to be true?

Read more »

A man in a business shirt and tie takes a wide leap over a large steel trap with jagged teeth.
Bank Shares

5.75% yield: Are ANZ shares a dividend trap?

ANZ's dividend currently beats out its own term deposits.

Read more »

Man holding out Australian dollar notes, symbolising dividends.
Dividend Investing

Here are 3 buy-rated ASX dividend stocks to beat falling interest rates

Brokers are recommending these stocks to clients.

Read more »

Senior man wearing glasses and a leather jacket works on his laptop in a cafe.
Dividend Investing

Overinvested in BHP shares? Here are two alternative ASX dividend stocks

There are other businesses worth owning for passive income.

Read more »

Happy young couple saving money in piggy bank.
Dividend Investing

3 strong ASX dividend shares to buy instead of CBA

Analysts think these are better options than Australia's largest bank.

Read more »

Male hands holding Australian dollar banknotes, symbolising dividends.
Dividend Investing

Why I'd buy ASX dividend shares now before it's too late

This could be the right time to look at ASX dividend stocks.

Read more »

Three happy office workers cheer as they read about good financial news on a laptop.
Dividend Investing

Beat low interest rates with these ASX dividend shares

As expected, on Tuesday the Reserve Bank of Australia elected to cut the cash rate once again. And with interest…

Read more »