I believe that one of the best ways to set yourself up for a comfortable retirement is by having a passive income stream that is both reliable and has the potential to grow over time.
In my opinion shares that pay dividends are the best way to achieve this in the current environment.
The good news is that the ASX is home to a number of quality companies that I believe could be great additions to a retirement portfolio.
Three that I like are listed below:
Collins Foods Ltd (ASX: CKF)
Collins Foods is a quick service restaurant operator with a large network of KFC restaurants in Australia and Europe. While the company still has a lot of room to grow in Australia, it is the European market that I believe will be the key driver of growth over the next decade. This is because the KFC brand is under-represented in Europe and has a significant runway for growth. In addition to this, the company’s plan to the roll out the Taco Bell brand across several Australian states should also support its earnings and dividend growth over the coming years.
Goodman Group (ASX: GMG)
Another ASX share to consider buying for a retirement portfolio is Goodman Group. This integrated commercial and industrial property group owns a high quality portfolio of assets across several countries and industries. Given that many of its assets have exposure to structural tailwinds such as ecommerce, I believe they will be in demand for a long time to come. In light of this, I believe it is well-placed to continue delivering strong rental income and distribution growth over the next decade and beyond.
Rural Funds Group (ASX: RFF)
Finally, I believe Rural Funds would be a great addition to a retirement portfolio. This is due to the quality of the agriculture-focused real estate property trust’s assets and their long term tenancy agreements. Another positive is that these agreements have built-in rental increases. I feel this has positioned the company to deliver on its target of growing its distribution by 4% per annum over the long term.
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More reading
- How to turn $20,000 into $350,000 in 10 years with ASX shares
- 5 top ASX dividend shares you should never sell
- 3 defensive ASX shares I’d buy for safety
- 2 quality ASX dividend shares to buy
- Why I would buy these blue chip ASX shares for the long term
Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. The Motley Fool Australia has recommended Collins Foods 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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