If you’re on the lookout for dividend shares for your retirement portfolio, then I think the three listed below could be worth considering.
All three have qualities that I think are attractive for retirees in search of both growth and income. Here’s why I would buy them:
BWP Trust (ASX: BWP)
The first ASX dividend share that I think retirees ought to consider buying is BWP. It is a real estate investment trust with a focus on commercial properties. The majority of the company’s assets are large format retailing properties which are leased to Wesfarmers Ltd (ASX: WES) operated Bunnings Warehouse. I think this is a great tenant to have and the risk of rental defaults and store closures is low in comparison to other areas of the retail sector. In light of this, I believe BWP is well-positioned to continue growing its income and distribution at a solid and predictable rate for a long time to come. I estimate that BWP will pay investors an 18.5 cents per share distribution in FY 2021. This means that its shares currently offer a forward 4.9% distribution yield. I believe this is very attractive for income-focused investors in this low interest rate environment.
Goodman Group (ASX: GMG)
Another dividend share to consider buying is Goodman Group. It shares may not offer the biggest yield, but I believe the integrated commercial and industrial property group could still be a top option for retirees. I estimate that Goodman will pay a distribution of approximately 32 cents per share in FY 2021. This represents a modest forward yield of approximately 2.2% based on its current share price. However, given its exposure to the structural tailwinds of the ecommerce market, I believe this distribution could grow strongly over the next decade and drive solid total returns for investors.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Wesfarmers 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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