Why I'd buy NAB, Telstra, and Rio Tinto shares for a passive income portfolio

Building a passive income portfolio requires more than finding the highest dividend yields on the ASX.

I would want businesses capable of supporting their payouts through different conditions, while still giving shareholders some opportunity for capital growth.

Here are three ASX shares I think could provide that balance.

National Australia Bank Ltd (ASX: NAB)

NAB would give the portfolio exposure to one of Australia's largest financial institutions and a steady stream of fully franked dividends.

The bank's leading position in business banking is the main reason I would choose it over some of its peers. I believe this side of the banking industry will fare better in the current environment of higher interest rates and a weakening housing market.

At a share price of around $40.39, the income also looks attractive.

According to CommSec consensus estimates, NAB is forecast to pay dividends per share of $1.70 in FY26 and $1.72 in FY27.

That represents forward dividend yields of approximately 4.2% and 4.3%, before any benefit from franking credits.

Telstra Group Ltd (ASX: TLS)

Telstra would add a more defensive source of income.

Mobile and internet services have become deeply connected to how Australians work, communicate, shop, travel, and access entertainment. Households may reduce spending elsewhere when conditions become difficult, but reliable connectivity remains a regular expense.

I particularly like Telstra's position in mobile. Its network coverage, brand, spectrum holdings, and years of investment give the company a strong position in a market where reliability can influence which provider customers choose.

The shares are trading around $4.89.

CommSec forecasts dividends per share of 21 cents in FY26 and 21.5 cents in FY27. That equates to forward dividend yields of around 4.3% and 4.4%.

Rio Tinto Ltd (ASX: RIO)

Rio Tinto would bring more volatility to the portfolio, but it could also provide stronger income when commodity markets are favourable.

The company remains a major iron ore producer, with large, low-cost operations capable of generating substantial cash flow.

It also has growing exposure to copper, which could benefit from investment in electricity networks, renewable energy, data centres, manufacturing, and infrastructure. That gives Rio Tinto more than one route to long-term earnings.

CommSec consensus estimates point to dividends per share of $6.37 in FY26 and $6.62 in FY27.

At around $159.99, those forecasts imply dividend yields of approximately 4.0% and 4.1%.

I think it is worth remembering that mining dividends can move considerably as commodity prices and profits change, so I would expect less consistency than I would from NAB or Telstra.

Foolish takeaway

A passive income portfolio can become vulnerable when every dividend depends on the same economic conditions.

That is why I like combining a major bank, a defensive telecommunications company, and a global miner. Their earnings are influenced by different customers, markets, and demand drivers, which should give the portfolio a broader foundation.

The forecast yields are all around 4%, providing a solid starting income without chasing companies offering payouts that may prove difficult to sustain.

The post Why I'd buy NAB, Telstra, and Rio Tinto shares for a passive income portfolio appeared first on The Motley Fool Australia.

Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2026