Shopping for FTSE 100 dividend shares will be an effective way to generate a dependable passive revenue. The index has among the highest yields on supply wherever, with loads of dependable payers.

As a eager revenue investor, I questioned whether or not ChatGPT might assist me choose dividend shares to think about shopping for. As a easy take a look at, I requested the AI to advocate the perfect FTSE 100 dividend inventory to purchase at the moment.

10 shares it steered

Total, the response was most likely a bit higher than I anticipated. Initially, ChatGPT averted the apparent entice of suggesting only one inventory. A diversified portfolio at all times makes extra sense for revenue.

As a substitute, AI supplied me with an inventory of 10 shares. They actually aren’t authentic strategies, however I feel they’re wise sufficient.

Right here’s the total listing. I’ve additionally included the 2025 forecast dividend yield for every inventory:

• Shell (4.7%)
• HSBC (6.7%)
• Unilever (3.6%)
• GSK (4.9%)
• Diageo (3.7%)
• Nationwide Grid (5.0%)
• Authorized & Common (LSE: LGEN) (9.8%)
• British American Tobacco (8.4%)
• AstraZeneca (2.5%)
• BT Group (5.7%)

This listing contains a lot of the largest firms within the FTSE 100. I might guess that that if I owned simply these 10, my portfolio would most likely come near monitoring the index.

How dependable are these dividends?

With a mean dividend yield of 5.5%, ChatGPT’s choice has the potential to generate a good revenue.

Nevertheless, dividends are by no means assured and could also be minimize. For instance, Nationwide Grid just lately minimize its payout (ChatGPT didn’t inform me that).

Certainly, during the last 5 years, Shell, GSK, HSBC and BT have additionally all minimize their payouts for varied causes. They’re all paying out respectable dividends now, however they aren’t probably the most dependable payers I might discover on the UK market.

The inventory I’d select…

There are a number of shares on this listing I feel are value contemplating. However my high selections at the moment would most likely be the 2 I already maintain – Unilever and Authorized & Common.

Of those two, Authorized & Common would most likely be my choose. The life insurance coverage and funding big is among the largest gamers within the UK market, with greater than £1trn of belongings beneath administration.

Over the past decade, L&G has turn into a market chief within the bulk annuity enterprise, taking up ultimate wage pension schemes from giant firms. This enterprise has the potential to generate dependable money flows for a few years to return.

One doable danger is that newish CEO António Simões has solely been within the function since 2023. The adjustments he’s made to date appear wise to me, however it is a enterprise the place it takes some time for adjustments to ship outcomes.

It might be a number of years earlier than we all know whether or not Simões has the best plans for long-term progress.

Nevertheless, Authorized & Common has been in enterprise for 188 years. It has an extended file of worthwhile operations and has not minimize its dividend since 2009. I imagine the corporate’s long-term future might be secure.

Metropolis analysts count on earnings to bounce again in 2025. That places Authorized & Common shares on a forecast price-to-earnings ratio of 9.5, with a 9.8% dividend yield.

I feel the shares are value contemplating as an revenue purchase at this degree.