How much do you need in an ISA to target a £12,000 passive income in 2026?
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Having an extra £1,000 a month in passive income is a nice chunk of change. And, in my opinion, one of the best ways to unlock this second income stream is with tax-free dividends inside a Stocks and Shares ISA.
By simply holding on to shares of typically larger and more mature businesses, investors can receive regular payments throughout the year.
On average, the UK stock market typically offers close to a 4% dividend yield. At this rate, earning an extra £12,000 requires an investment portfolio to be worth close to £300,000. However, by being more selective, a portfolio can target a payout ranging 5%-6%, bringing the required portfolio size down to as low as £150,000.
Obviously,…
