I think UK shares are great for passive income. This is because the FTSE 100 and FTSE 250 currently have average dividend yields of 3.1% and 3.3%, respectively.
But some investors may not be satisfied with a yield of around 3%. And, I understand why…
With a £20,000 investment, a portfolio yielding 3% would only generate £600 per year.
However, it’s possible to find high-quality dividend stocks with much higher dividend payouts. For example, if an investor’s portfolio yields 7%, they would make £1,400 a year. That’s an extra £800 a year!
Here are two UK shares that could help to achieve just that.
The highest yield in the FSTE 100
Legal & General (LSE:LGEN) shares have a dividend yield of 8.1%, which is currently the highest in the Footsie.
There’s plenty I like about the company aside from this. Most notable is how I think current demographic shifts could be highly beneficial to the insurance firm in the long run.
While an ageing population won’t necessarily have a positive effect on the UK economy as a whole, it could mean that there’s higher demand for retirement services.
In fact, by 2034, pensioners are expected to account for a fifth of the UK population. This could make the retirement industry boom.
What’s great for Legal & General is that this is its most profitable area. It saw operating income from retirement services climb by 6.5% in 2025, and I think this will soar over the next decade.
Its shares don’t come without risk, given its status as a financial services firm. If the global economy is in trouble, the firm may find itself in trouble as well. This isn’t out of the question either, as the OECD forecasts some countries falling into a recession if the Iran war drags into 2027.
That said, £20,000 put into its shares today could make investors £1,624 a year, which is roughly £135 a month. Dividends aren’t guaranteed, but I think this will only grow as the company’s earnings do.
Its shares are definitely worth looking into further. However, a diversified portfolio may be better, so let’s look at the next UK share.
An overlooked opportunity?
With a yield of 6.1%, ITV (LSE:ITV) shares may be an overlooked dividend opportunity.
There are some very real concerns about whether the broadcaster has a future in the world of streaming. This is a very competitive space, and there’s no guarantee that it will be successful.
But these concerns have pushed the firm’s valuation down, as its shares only trade at a forward price-to-earnings ratio of 9.2.
A combination of a high yield and low valuation is enticing. The fact that it has turnaround potential makes it even more worthwhile for investors to consider looking into its shares further.
And, it looks like there are some promising signs on the turnaround front. ITV Studios’ total organic revenue growth was 3% in the first quarter of 2026. Total streaming hours also increased by a very impressive 13% to 692m hours in the period.
Overall, I think both Legal & General and ITV represent compelling passive income opportunities for investors to explore further, and combined, average a 7% yield. But I don’t think they are the only opportunities…
Should you invest £5,000 in ITV right now?
When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.
And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if ITV made the list?
Muhammad Cheema does not hold any positions in the companies mentioned.
The post With dividend yields averaging above 7%, are these 2 UK shares worth considering? appeared first on The Twelfth Magpie.
More reading
- 8%-yielding Legal & General shares just gave me another 395 reasons to like them
- Just 9% of us can expect a ‘comfortable’ retirement! Could UK shares be the answer?
- 3 passive income shares to consider buying for a 7% yield
- How much would you need in an ISA to match the new State Pension and get another £12,547 a year?
- Here’s why Legal & General is still one of the UK’s most popular SIPP buys
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