4 big-name income stocks to hold for your retirement

Is it possible to really make a lot of money by share investing over a long period of time?

If you started early around your mid-20s and invested every month similar to socking away money in a bank, you could have a sizeable amount of money by age 65. It all comes down to the rate of return you get and how many instalments you actually make.

Getting a rate like 6.5% annually will keep the compounding growth strong. However, good luck getting 6.5% bank deposit interest these days. Alternatively, the 30-year average gain for the S&P ASX All Ordinaries Index (ASX: ^XAO) is about 7.2% (from 666 in 1984 to 5,432 now), so a long-term investor could have done it through regular share investing and have a big stack of dollar bills now.

On top of that would also come dividend income. You could possibly have an extra 2% – 5% from dividend yield added to your share price gains. That’s why Foolish readers seek out good dividend stocks. Your dividend income could be as much as 40% of your total investing returns over the long term.

Here are some good income stocks paying very generous yields.

Westpac Banking Corporation (ASX: WBC) pays a fully franked 5.2% yield and has a good record for raising dividends.

— Woodside Petroleum Limited (ASX: WPL), the $34 billion oil and gas producer offers a 5.8% yield fully franked.

— Coca-Cola Amatil Ltd (ASX: CCL), the Coca-Cola bottler and distributor in Australia and four nearby countries pays a 5.6% yield partially franked.

— Woolworths Limited (ASX: WOW) has a 3.8% yield fully franked and a long history of raising dividends.

Seriously investing on a regular basis can achieve some serious money. You don’t have to shoot the lights out to be financially successful. You just need to invest in quality stocks paying a good dividend yield. 

A better investment than these 4

Of these great companies, my pick would be Coca-Cola Amatil. However, there's one ASX stock which I believe has even better growth prospects than these 4 and pays a better dividend! 

This little known ASX company has already delivered eight consecutive years of profit and dividend growth... but with even more growth ahead, the shares are still a firm "BUY" today! Discover The Motley Fool's #1 dividend pick in our newly updated report. Simply click here for your FREE copy right now.

Motley Fool contributor Darryl Daté-Shappard does not own shares in any company mentioned. 

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