As I mentioned here earlier, the Westpac Banking Corp (ASX: WBC) economics team is not ruling out negative interest rates in the near future.
While I don’t personally expect rates to drop any further from here, it certainly is a possibility in the current environment.
Whether or not they do go lower, only time will tell. But one thing that I’m certain about, is that rates will be staying at ultra low levels for years to come.
In light of this, I think investors in search of income ought to look to the share market.
Three top ASX dividend shares that I would buy are listed below. Here’s why I like them:
Dicker Data Ltd (ASX: DDR)
Dicker Data is a growing distributor of computer hardware and software. It has an incredibly resilient business that continues to grow during the pandemic. So much so, this year the company intends to increase its dividend by 31% to 35.5 cents per share. This equates to a fully franked 4.5% dividend yield based on its last close price. Another positive is that Dicker Data is one of just a handful of ASX dividend shares that pay their dividends in quarterly instalments.
Rural Funds Group (ASX: RFF)
Rural Funds is a property company with a focus on Australian agricultural assets. Its properties are leased to experienced agricultural operators on long term tenancy agreements with fixed rent increases built in. This provides the company with a lot of earnings visibility. As a result, it has been able to provide distribution guidance for FY 2020 and FY 2021. It plans to pay shareholders 10.85 cents per share this year and then 11.28 cents per share next year. The latter equates to a 5.6% distribution yield.
Vanguard Australian Shares High Yield ETF (ASX: VHY)
A third option for income investors to consider is the Vanguard Australian Shares High Yield ETF. I think this is one of the best exchange traded funds for income investors. This is because it gives investors exposure to a diverse group of high yielding ASX dividend shares through a single investment. At present I estimate that its units provide a forward dividend yield of at least 4.5%.
NEW: Expert names top dividend stock for 2020 (free report)
When our resident dividend expert Edward Vesely has a stock tip, it can pay to listen. After all, he’s the investing genius that runs Motley Fool Dividend Investor, the newsletter service that has picked huge winners like Dicker Data (+92%), SDI Limited (+53%) and National Storage (+35%).*
Edward has just named what he believes is the number one ASX dividend stock to buy for 2020.
This fully franked “under the radar” company is currently trading more than 24% below its all-time high and paying a 6.7% grossed-up dividend.
The name of this dividend dynamo and the full investment case is revealed in this brand new free report.
But you will have to hurry — history has shown it can pay dividends to get in early to some of Edward’s stock picks, and this dividend stock is already on the move.
More reading
- 2 ASX shares to buy for strong retirement income
- Westpac isn’t ruling out negative interest rates in Australia
- How to make $1,000 a month in dividends
- Insiders have been buying these ASX shares this week
- 3 cheap ASX 200 shares I’d buy today
Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended Dicker Data Limited and RURALFUNDS STAPLED. 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.
The post Beat low interest rates with these ASX dividend shares appeared first on Motley Fool Australia.
from Motley Fool Australia https://ift.tt/36PlszN
Leave a Reply