Later this afternoon the Reserve Bank of Australia will almost certainly keep rates on hold at the record low of 1.5% for the 23rd consecutive meeting.
While this is a positive for borrowers, the low interest environment is a bit of a nightmare for savers.
The good news is that there are plenty of high yield options on the local share market that smash interest rates. Three to consider are listed below:
Adairs Ltd (ASX: ADH)
I think one of the most underappreciated results during earnings season came from this home furnishings retailer. It has successfully turned its performance around and posted an impressive 45.4% increase in profits to $30.6 million. This was driven by a 14.3% increase in like for like sales, improved margins from less discounting, and strong online sales growth. The good news is that FY 2019 has started strongly with management reporting like for like sales growth of 5.4% year-to-date. I feel this puts Adairs in a position to deliver another strong profit result and lift its dividend again. At present the retailer's shares offer a trailing fully franked 5.4% yield.
Dicker Data Ltd (ASX: DDR)
The shares of this founder-led computer software and hardware wholesale distributor currently offer an estimated full year fully franked dividend yield of 5.8%. This is based on management's plan to increase its dividend to 18 cents per share in FY 2018. But considering the strong performance so far this financial year, I wouldn't be overly surprised if it paid an even greater dividend. Last month Dicker Data posted half year revenue of $717.6 million and operating profit before tax of $21.75 million. This was a 13.5% and 11.9% increase, respectively, on the prior corresponding period.
Westpac Banking Corp (ASX: WBC)
I would much rather have my money invested in this banking giant's shares than sitting in one of its savings accounts. Especially when its shares are offering investors a trailing fully franked 6.6% dividend yield at present. While the banks are experiencing tough trading conditions right now, I feel this has been fully reflected in their respective share prices. As a result, this could make it an opportune time to snap up bank shares.
