The Motley Fool

3 ASX dividend shares to replace your term deposit

With the cash rate at a record low and tipped to go lower, the interest rates on term deposits are barely beating inflation these days.

For example, Westpac Banking Corp (ASX: WBC) is currently offering yields of 2.2% per annum based on deposits under $100,000.

This is a shame because term deposits can be an incredibly useful way of generating a source of income for retirees.

But don’t worry because the ASX is here to save the day. Three top dividend shares which I think could replace a term deposit are listed below:

National Storage REIT (ASX: NSR)

I’m a big fan of this self-storage operator and think it would be a great addition to most portfolios. Thanks to its successful focus on multiple revenue streams and acquisitions, in the first half of FY 2019 the company posted a 17.4% increase in underlying earnings to $26.3 million. I’m confident that there’s still plenty more growth ahead for the company thanks to increasing demand and its opportunity to grow through acquisitions in a highly fragmented market. At present its shares offer a forward yield of between 5.6% and 5.8%.

Rural Funds Group (ASX: RFF)

Rural Funds is an agriculture-focused real estate property trust with assets across a wide range of industries including cattle, almonds, and wine production. I believe the property trust could be a great term deposit replacement due to it being well-positioned to grow its distribution at a solid rate over the next decade thanks to its high quality portfolio, long term leases, and use of rental indexation. Its units currently offer investors a 4.8% forward distribution yield.

Transurban Group (ASX: TCL)

Another dividend share that could be a good term deposit replacement is this toll road giant. Thanks to increasing demand for its roads, recent acquisitions, and toll price increases, I believe Transurban is well-placed to grow its earnings and distribution at a solid and predictable rate over the long term. At present its units provide investors with a trailing distribution yield of 4.2%

5 ASX Stocks for Building Wealth After 50

I just read that Warren Buffett, the world’s best investor, made over 99% of his massive fortune after his 50th birthday.

It just goes to show you… it’s never too late to start securing your financial future.

And Motley Fool Chief Investment Advisor Scott Phillips just released a brand-new report that reveals five of our favourite ASX stocks for building wealth after 50.

– Each company boasts strong growth prospects over the next 3 to 5 years…

– Most importantly each pays a generous dividend, fully franked.

Simply click here to find out how you can claim your FREE copy of “5 ASX Stocks for Building Wealth After 50.”

See the stocks now