When you first start investing you might focus on quality growth shares that offer potentially strong returns like Afterpay Touch Group Ltd (ASX: APT). After all, if things don't go to plan, you still have plenty of time to recover your losses.
But as you near retirement I believe it is prudent to put these types of investments on the back-burner in favour of those offering income and capital preservation.
Three shares which I think are perfect for a retirement portfolio right now are as follows:
Coles Group Ltd (ASX: COL)
Investors looking for shares that provide a combination of growth and income might want to consider this supermarket giant. I think Coles is well-positioned to deliver solid total returns for investors over the next decade thanks to its refreshed strategy. This strategy aims to deliver $1 billion in cumulative savings by FY 2023. Another positive is the company's generous dividend policy which will see Coles pay out between 80% and 90% of its earnings to shareholders. I estimate this means a forward fully franked 3.7% dividend yield.
Sydney Airport Holdings Pty Ltd (ASX: SYD)
I think Sydney Airport would be a great option for a retirement portfolio. Thanks to the combination of increasing global tourism, its position as the main gateway into and out of Australia, and a recovery in domestic tourism, I believe it is well-positioned to grow its income and its dividend at a solid rate over the next decade. At present Sydney Airport's shares offer a trailing 4.35% dividend yield.
Transurban Group (ASX: TCL)
One of my favourite dividend shares for retirees is this toll road operator. It has consistently grown both its earnings and distributions at a solid rate over the last decade. This was certainly the case in FY 2019 when it reported a 12.3% increase in proportional EBITDA to $2,016 million. Pleasingly, management remains positive on its outlook and further solid growth looks likely this year. As a result, the company plans to increase its distribution by 5.1% to 62 cents per security. This equates to a forward 4.2% distribution yield.
