With rates not going higher any time soon, if I were a retiree I would look to the share market to grow my wealth and generate a source of income.
Three shares that I believe would be suitable for retirees right now are listed below:
Australia and New Zealand Banking Group (ASX: ANZ)
If you don't already have exposure to the banks then I think it would be well worth doing so at current prices. My favourite in the sector right now is ANZ due to its valuation and my belief that it is well-positioned to achieve modest profit growth over the coming years thanks to its exposure to commercial lending and its cost cutting opportunities. I believe this will allow the bank to at least maintain its dividend, which at present provides investors with a trailing fully franked 6% yield.
Coles Group Ltd (ASX: COL)
Another top option for retirees could be this supermarket giant. I expect Coles to become a real favourite with income investors thanks to its defensive qualities, solid growth prospects, and plans to pay out between 80% and 90% of its earnings as dividends. Based on this, I estimate that its shares are currently offering investors a fully franked forward 5% dividend. I think this makes it well worth considering at current levels.
National Storage REIT (ASX: NSR)
My top pick for retirees is this self-storage-focused real estate investment trust. National Storage is one of the largest self-storage operators in Australia and New Zealand and has plans to grow even larger in the coming years. Late last year the trust raised $212 million to support its growth through acquisition strategy and fund its development pipeline. I expect the combination of organic and inorganic growth to allow National Storage to increase its dividend at a solid rate for many years to come. This year it intends to pay a distribution of between 9.6 cents to 9.9 cents per unit, which equates to a yield of between 5.5% and 5.7%.
