A series of cash rate cuts has left interest rates at record lows.
For example, the current interest rate on a Commonwealth Bank of Australia (ASX: CBA) five-year term deposit is just 1.25%.
This makes it near impossible for income investors to generate a sufficient level of income with term deposits.
Fortunately, the share market is here to the rescue with a plethora of dividend shares offering far more generous yields. Here are three which could help you smash low interest rates:
National Storage REIT (ASX: NSR)
National Storage is a self-storage-focused real estate investment trust which owns a network of 168 centres throughout the ANZ region. Although this makes it one of the largest operators in the region, management still sees plenty of room for growth through developments and acquisitions. I expect this to lead to support solid income and distribution growth for many more years to come. At present its shares provide a 5.2% trailing distribution yield.
Telstra Corporation Ltd (ASX: TLS)
It certainly has been an eventful few years for this telco giant. The NBN rollout has hit its bottom line hard, leading to a significant decline in earnings and ultimately its dividend. The good news is that the end of the NBN rollout is now in sight. In addition to this, the arrival of 5G looks like it could be a cash cow for Telstra in the coming years. Especially if consumers opt to bypass the NBN in favour of 5G in their homes. Overall, I believe Telstra's outlook is greatly improved and its dividend looks sustainable. Its shares currently offer a trailing fully franked 4.5% dividend yield.
VanEck Vectors Australian Banks ETF (ASX: MVB)
If you're looking at investing in the big four banks but can't decide which one to choose above the rest, then you're in luck. The VanEck Vectors Australian Banks ETF gives investors exposure to all the big four banks, the regionals, and also Macquarie Group Ltd (ASX: MQG). Its units currently offer investors a trailing 5.3% partially franked yield.
