When you’re young and first start investing you might focus on growth shares that provide you with the potential for outsized returns. Shares like Afterpay Ltd (ASX: APT) and Zip Co Limited (ASX: Z1P) immediately come to mind.
After all, if your investments don’t go to plan, you have time on your side to recover from your losses.
But as you enter retirement, it may be prudent to limit your exposure to these type of investments and focus on those that offer income and capital preservation.
With that in mind, I have picked out a couple of ASX shares that could be good options for retirees right now. They are as follows:
Goodman Group (ASX: GMG)
Goodman Group could be a good option for retirees. While its shares may not offer the biggest yield, the integrated commercial and industrial property group looks well-placed to grow its earnings and distribution at a solid rate over the next decade.
This is due to its exposure to a number of markets benefiting from structural tailwinds, such as the ecommerce market.
One broker that expects this to be the case is Macquarie. It recently upgraded its shares to a buy rating with a $20.39 price target. The broker believes Goodman can grow its earnings by at least 10% per annum through to FY 2024.
Its analysts are also forecasting a 30 cents per share distribution in FY 2021. This represents a 1.6% yield.
National Storage REIT (ASX: NSR)
National Storage is a leading self-storage focused real estate investment trust. It is one of the largest self-storage operators in the ANZ region with a network of over 200 centres. But it doesn’t plan to stop there. The company continues to see room to expand its network in the future via its development projects and growth through acquisition strategy.
This should support solid income and distribution growth over the next decade, especially given the improving housing market. This traditionally results in growing demand for its services as people move homes or downsize.
For now, management expects to report underlying earnings per share of 7.7 cents to 8.3 cents in FY 2021. It also plans to pay 90% to 100% of its earnings out to shareholders as distributions.
Based on the middle of this guidance range, its shares offer investors a forward 3.6% dividend yield.
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Returns As of 15th February 2021
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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