2 high yield ASX dividend shares to solve your income needs

If you're struggling with low interest rates, then I would suggest you consider Telstra Corporation Ltd (ASX:TLS) and this ASX dividend share…

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If you're struggling with the low interest rates on term deposits, then you might want to look to the share market.

The Australian share market is home to a large number of shares that are providing investors with superior yields.

But which ASX dividend shares should you buy today? Two that I'm a big fan of are listed below:

Telstra Corporation Ltd (ASX: TLS)

The first dividend share to buy is Telstra. I've been very impressed with the progress it is making with its T22 strategy and firmly believe that it has positioned it for a return to growth in the near future. Especially now the NBN headwind is easing and 5G internet has arrived. The latter looks likely to give its key mobile revenues a boost over the coming years. Combined with its rampant cost cutting and the simplification of its business, things are looking increasingly positive.

In addition to this, I'm optimistic that Telstra can avoid a dividend cut in FY 2021. This could be achieved if it switches its dividend policy to be based on its free cash flow rather than accounting earnings. If the company does make the switch, based on the current Telstra share price, it would offer investors a very generous 5.7% yield.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

Another option for income investors to consider buying is an exchange traded fund. The Vanguard Australian Shares High Yield ETF is invested in a total of 66 high yield shares. This means income investors are able to diversify their portfolio significantly through just a single investment. This is a big positive in my eyes. After all, diversity has proven to be very important during the pandemic due to dividend deferrals and suspensions.

Among its holdings you will find the big four banks, BHP Group Ltd (ASX: BHP), and Telstra. Based on the current Vanguard Australian Shares High Yield ETF share price, I estimate that it offers a FY 2021 dividend yield in the region of 4% to 5%.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. 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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