MENU

Beat low interest rates with these high yield dividend shares

Later this week the U.S. Federal Reserve is expected to raise interest rates once again. This could be the first of up to four hikes that the central bank makes this year.

Unfortunately, it is a very different picture back home in Australia where most economists have now ruled out a rate rise in 2018.

This means the paltry interest rates on offer from bank accounts and term deposits are likely to be here for quite a bit longer.

But don’t worry because the local share market has a number of quality dividend shares for investors to choose from. Here are three that I like right now:

Japara Healthcare Ltd (ASX: JHC)

Although this aged care operator’s performance has been a touch disappointing of late and recently led to a full-year guidance downgrade, I believe that in the long-term its shares have the potential to provide strong total returns thanks to its generous dividend and the increasing demand it is experiencing from Australia’s ageing population. At the current share price Japara’s shares provide a trailing fully franked 5% dividend.

Telstra Corporation Ltd (ASX: TLS)

I remain confident that Telstra will be able to maintain its 22 cents per share dividend for the next two to three years thanks largely to its cost saving initiatives. After which, a lot will depend on the success of the company’s investments, the impact of 5G internet, and whether the Federal Government writes down the value of the NBN. The latter is expected to increase margins for telco providers if it happens. At the current price, Telstra’s shares provide a fully franked 6.5% dividend.

Westpac Banking Corp (ASX: WBC)

While there is a risk that the Royal Commission could find a skeleton in the closet, I remain confident that nothing truly untoward will come of it. So the recent weakness in Australia’s oldest bank’s share price could arguably be a buying opportunity for investors with limited exposure to the banking exposure. Especially with Westpac’s shares providing a trailing fully franked 6.4% dividend.

This fourth dividend share may not have the biggest yield on the market, but in a few years that could be a very different story.

OUR #1 dividend pick to grow your wealth over the new financial year is revealed for FREE here!

Financial year 2018 is here and The Motley Fool’s dividend detective Andrew Page has revealed his must buy dividend share to grow your wealth in 2018.

You might not know this market leader's name, but it's rapidly expanding into a highly profitable niche market here in Australia. Even better, the shares boast a strong, fully franked dividend that should balloon in the years to come. In other words, we're looking at the holy grail of incredible long-term growth potential AND income you can watch accruing in your account in real time!

Simply click here to grab your FREE copy of this up-to-the-minute research report on our #1 dividend share recommendation now.

Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.