As every retiree would know, investing enters a whole new ballgame when you reach your golden years. Preservation of capital becomes paramount, closely followed by maximising your return on capital (yield).
Investors still scarred from the GFC would remember the feeling of thinking the assets you’ve invested in were safe, only to see many lose over half their value in a very short time.
With this in mind, here are 3 ASX dividend shares that I think are perfect for any retiree or capital-conscious investor.
Coles Group Ltd (ASX: COL)
Coles is a relatively new company on the ASX but has already amassed a reputation as a steady dividend investment. I think this company is perfect for a retiree portfolio for a few reasons.
Firstly, its grocery business is highly defensive, meaning people are not likely to stop shopping at Coles no matter the economic weather outside.
Secondly, Coles’ Smarter Selling cost-cutting program should ensure a stable and growing dividend well into the future. The announcement today that Coles is partnering with UK-based Sainsbury’s to bulk up its home-brand offerings is also a welcome addition.
For these reasons, I think Coles is offering a compelling case for dividend investors today.
Transurban Group (ASX: TCL)
Transurban has become a dividend favourite over the last few years. Investors can’t seem to get enough of this toll-road king, which owns many major arterial roads/highways through Sydney, Melbourne and Brisbane amongst other cities.
Again, I like Transurban’s defensive nature – toll-roads are unavoidable for many motorists (including freight trucks) and Transurban also benefits from contractual toll rises every year (which are often pegged at 4%, well above inflation). This ensures Transurban is able to deliver inflation-beating dividend rises every year – not bad considering TCL shares offer a starting yield of 3.95% today.
I think these 2 ASX divided shares would be perfect for a retiree portfolio. Both companies offer resilient earnings bases on top of healthy dividend yields – what more could you ask for?
5 stocks under $5
We hear it over and over from investors, "I wish I had bought Altium or Afterpay when they were first recommended by The Motley Fool. I'd be sitting on a gold mine!" And it's true.
And while Altium and Afterpay have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $5 a share!
*Extreme Opportunities returns as of June 5th 2020
Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Transurban Group. 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.