These high yield dividend shares could be perfect for income investors

Overnight the U.S. Federal Reserve hiked interest rates once again, bringing them into the 2% to 2.25% target range.

Unfortunately, it appears unlikely that the Reserve Bank of Australia will follow suit any time soon, meaning the low interest rates on offer from savings accounts and term deposits will be here for a while yet.

The good news is that there are a number of quality options on the local share market that smash these rates.

Two high yield options I would suggest investors consider today are as follows:

Australia and New Zealand Banking Group (ASX: ANZ)

While it may be prudent to wait for the report from the Royal Commission which is due by Sunday, I’m confident that the potential repercussions have been priced into bank shares already. So with their shares trading on lower than average multiples and offering generous dividend yields, now could be a good time to consider investing if you don’t already own them. One bank which I would consider is ANZ Bank. Thanks to its high CET1 ratio, low bad debts, and recent out of cycle rate rise, I believe it is well placed to grow its earnings and dividend in FY 2019. At present its shares provide a trailing fully franked 5.7% yield. As well as ANZ Bank, I think Westpac Banking Corp (ASX: WBC) is another bank share worth considering.

Super Retail Group Ltd (ASX: SUL)

I thought that one of the strongest results in the retail sector last month came from this retail group. Super Retail, which is responsible for brands including Super Cheap Auto, Rebel Sports, and Macpac, posted a 26% increase in net profit after tax to $128.3 million during the year thanks to positive performances from the majority of its portfolio. The good news is that the company looks set to build on this in FY 2019 following a strong start to the year. Management advised that each of its businesses had achieved positive like for like sales growth during the first few weeks of the year. I believe this puts Super Retail in a position to lift its dividend again this year. At present its shares provide a trailing fully franked 5.5% yield. Elsewhere in the sector, I think Adairs Ltd (ASX: ADH) is well worth a closer look.

And don't forget this top dividend share that has been growing its pay out at a strong rate over the last few years and shows no signs of slowing.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of Super Retail Group 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.

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