UPDATE: An investor aims for a staggering £26,515 annually in retirement income from a £20,000 investment in Legal & General (LSE: LGEN), a passive income powerhouse. This comes as the firm has consistently delivered robust returns, highlighting its potential for future growth.
Just announced, Legal & General’s financial results demonstrate impressive earnings growth, with operating profits rising 6% year over year to £1.616 billion as of March 2024. This momentum has continued, with further reports indicating operating profits of £859 million for the first half of 2025, alongside a 9% increase in earnings per share to 10.94p. Analysts anticipate an extraordinary 27.2% growth in earnings through 2027.
The investor’s strategy hinges on the company’s recent strategic partnership with Japanese insurance giant Meiji Yasuda, which acquired a 5% stake for a staggering $2.3 billion (£1.8 billion). This collaboration is expected to bolster Legal & General’s earnings, particularly through its expanding US Pension Risk Transfer business, where an estimated $3 trillion in defined benefit pension schemes remain untapped.
Legal & General’s dividend yield is currently impressive, with a payout of 21.36p in 2024, yielding nearly 9%, significantly higher than the FTSE 100 average of 3.1%. With forecasts indicating dividends may increase to 21.8p this year and even higher in subsequent years, the investor’s belief in the firm’s potential is well-founded.
If an additional £20,000 is invested, projections suggest that dividends could reach £29,027 after ten years. In twenty years, this could grow to £100,183, and after thirty years, a remarkable £274,612 in dividends, making the initial investment worth £294,612 overall. This trajectory would enable the investor to draw a substantial annual income of £26,515 from their retirement funds.
The investor is now considering increasing their position in Legal & General while also scouting other high-yielding FTSE firms to enhance their retirement strategy. As the financial landscape evolves, investors are urged to keep a close watch on these developments, as opportunities for significant passive income continue to arise.
For those seeking to make informed investment decisions, the Motley Fool’s expert Mark Rogers has highlighted six standout stocks worth considering, potentially including Legal & General Group Plc.
Stay updated as this story develops, and explore these investment opportunities for your financial future.
