UPDATE: New forecasts reveal that a £10,000 investment in Legal & General (LSE: LGEN) shares could yield an impressive £859 in passive income by 2026. This development is crucial for UK investors seeking reliable income streams in a fluctuating market.
Legal & General has consistently been a go-to choice for passive income in the UK, thanks to its strong dividend yields within the FTSE 100 index. In 2025, the company paid out dividends of 15.36p per share on June 5 and 6.12p on September 26, totaling 21.48p. With plans to increase dividends by 2% annually, shareholders can expect approximately 21.9p per share in 2026.
For new investors, assuming a share price of £2.55, purchasing £10,000 worth of shares would yield approximately 3,921 shares. Multiplying this by the anticipated dividend of 21.9p results in a potential passive income of £859 for the year.
However, potential investors should exercise caution. Dividends are not guaranteed; companies can reduce or cancel them at any time. Legal & General’s current dividends exceed its earnings, indicating a low dividend coverage ratio, which raises concerns about sustainability.
Market volatility poses another risk, with share prices potentially fluctuating due to economic conditions. Over the past decade, Legal & General’s share price has struggled, lagging behind major indexes like the FTSE 100 and S&P 500.
Investors are left to ponder whether the rewards justify the risks. While Legal & General remains an attractive option for a diversified income portfolio, experts suggest exploring other shares that may offer higher returns over a five-year period.
Mark Rogers, a noted investment expert, recently highlighted six standout stocks worth considering. Those interested in passive income should evaluate all opportunities before committing funds.
As market dynamics evolve, investors are urged to stay informed about ongoing developments in the financial landscape. The potential for a robust passive income stream through Legal & General is appealing, but thorough research is essential to navigate the associated risks effectively.
Stay tuned for more updates on this developing story as more data emerges.
