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3 ASX dividend shares to buy for 2020

The best way to invest is for the long-term, allowing your investments to benefit from compounding over time.

ASX dividend shares are in high demand after the Reserve Bank of Australia (RBA) decided to cut interest rates twice in quick succession.

I think these three ASX dividend shares could be worth buying for 2020 and beyond:

Magellan Global Trust (ASX: MGG) 

One of the best investment managers in Australia is Magellan Financial Group Ltd (ASX: MFG). The consistently strong performance by Magellan has created excellent returns for investors.

This listed investment trust (LIT) targets a 4% distribution yield for investors, which is a solid yield with banks offering such low interest returns.

Magellan Global Trust invests in high-quality global businesses like Yum Brands, Alphabet, Facebook, Oracle, Visa and MasterCard, which could keep growing profit for many years to come thanks to their economic moats.

The trust does come with quite high fees, but the net returns have been very good despite that.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) 

Soul Patts is my favourite way to invest across the Australian economy. It’s invested in Brickworks Limited (ASX: BKW), TPG Telecom Ltd (ASX: TPM), New Hope Corporation Limited (ASX: NHC), listed investment companies (LICs) and other diversified options.

It has high levels of management ownership of shares, ensuring they won’t be too risky with the investment choices and Soul Patts has a record of outperformance compared to the ASX.

Soul Patts has increased its annual ordinary dividend every year since 2000 and it could keep going up for many more years. It currently offers a grossed-up dividend yield of 3.9%.

Rural Funds Group (ASX: RFF) 

This is a bit of a controversial choice considering what’s going on with the short attack and various accusations. However, assuming that Ernest & Young confirm all of Rural Funds’ defence points, the current share price of $1.84 looks like an attractive income option.

Management aim to increase the distribution by 4% every year and it has done so each year since it started paying a distribution.

Based on the forecast FY20 distribution, it has a forward distribution yield of 5.9%. But, I wouldn’t want to jump into investing until we get confirmation from EY that everything is hunky dory.

Foolish takeaway

I think each of these shares are good dividend opportunities. I think Soul Patts is the gold standard for growing income, and Rural Funds looks attractive at this price – it may go up after the EY report is released – but it’s a higher-risk option until then.

These top ASX dividend shares could also be worth buying for income for 2020 and beyond.

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Motley Fool contributor Tristan Harrison owns shares of MAGLOBTRST UNITS, RURALFUNDS STAPLED, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Brickworks. 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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