By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Make Financial CenterMake Financial CenterMake Financial Center
  • Home
  • Investing
  • Banking
  • Credit Cards
  • Mortgages
  • Money Management
  • Marketing
  • Retirement
Reading: If I was approaching retirement, I’d buy these 3 dividend stocks for passive income
Notification Show More
Make Financial CenterMake Financial Center
Search
  • Home
  • Investing
  • Banking
  • Credit Cards
  • Mortgages
  • Money Management
  • Marketing
  • Retirement
© 2024 All Rights Reserved | Powered By Make Financial Center
Retirement

If I was approaching retirement, I’d buy these 3 dividend stocks for passive income

Make Financial Center July 24, 2024
Share
5 Min Read
The words "what's your plan for retirement" written on chalkboard on pavement somewhere in London
SHARE

Picture supply: Getty Photographs

Contents
A lower-risk inventoryRising earningsA excessive yield

Dividend shares is usually a highly effective retirement earnings instrument. These shares – which pay out cash to shareholders regularly – can probably generate fairly a giant money movement.

Right here, I’m going to spotlight three UK dividend shares I’d purchase if I used to be approaching retirement. I reckon these corporations – which at present supply yields of between 4% and 9.5% – could possibly be nice long-term investments for me in my golden years.

A lower-risk inventory

If I used to be nearing retirement, I’d need to personal loads of steady sleep-well-at-night dividend shares. And one identify that matches the invoice right here is Unilever (LSE: ULVR).

A number one client items firm, it tends to generate pretty steady revenues and earnings it doesn’t matter what the economic system’s doing. Consequently, the inventory’s a lot much less unstable than the broader UK market.

That is illustrated by its ‘beta’ of 0.4. This metric signifies that for each 1% transfer within the UK market (up or down), Unilever shares usually solely transfer round 0.4%.

As for the dividend yield, it’s round 4% as we speak. That’s not the very best yield round. However held in a Shares and Shares ISA, it could possibly be fully tax-free.

Please be aware that tax therapy relies on the person circumstances of every consumer and could also be topic to alter in future. The content material on this article is supplied for data functions solely. It’s not supposed to be, neither does it represent, any type of tax recommendation. Readers are answerable for finishing up their very own due diligence and for acquiring skilled recommendation earlier than making any funding choices.

The principle threat with this firm, to my thoughts, is that buyers ditch Unilever’s manufacturers (Dove, Hellmann’s and so on) for cheaper ones. In as we speak’s high-interest-rate atmosphere, we are able to’t rule this situation out.

With the inventory buying and selling at a really affordable valuation (the P/E ratio is simply 16) nevertheless, I like the chance/reward proposition as we speak.

Rising earnings

One other inventory I’d select for its stability and security is Tesco (LSE: TSCO). Like Unilever, it has a steady enterprise mannequin (individuals all the time have to eat). And the inventory is way much less unstable than the general UK market. Its beta is round 0.6, that means the inventory can be within the sleep-well-at-night camp.

As for the possible dividend yield right here, it’s at present about 4.5%, which is first rate. And analysts anticipate the payout to rise within the years forward.

I additionally see the potential for share worth appreciation. That’s as a result of the inventory’s at present buying and selling at a really low valuation (the P/E ratio is simply 11).

That mentioned, the cost-of-living disaster is a threat right here too. It might end in shoppers turning to lower-cost supermarkets reminiscent of Lidl and Aldi.

A excessive yield

Lastly, I’d go together with banking large HSBC (LSE: HSBA). Now this inventory is riskier than the opposite two. That’s as a result of banking is a cyclical business.

Nevertheless, I just like the long-term story right here. Lately, the financial institution’s shifted its focus to higher-growth areas reminiscent of Asia and wealth administration. So I reckon it’s properly positioned for the long run.

As for the dividend, it’s very engaging for the time being. Final yr, the financial institution paid out 61 cents to buyers, which equates to a yield of seven.5% as we speak. This yr nevertheless, the corporate appears set to make a particular fee, taking the full payout to round 76 cents – a yield of round 9.5%.

On condition that Unilever and Tesco are decrease on the chance spectrum, I’d be prepared to tackle the added threat of this inventory to select up the excessive yields on supply.

You Might Also Like

Consider this strategy to target £25,000 in retirement income from a Stocks and Shares ISA

Forget the State Pension! Here’s how to target a comfortable retirement income with £500 a month

3 techniques to turbocharge your SIPP for a richer retirement!

£5,000 invested in a SIPP 5 years ago could now be worth…

Could £300 a month invested in US and UK shares reach a million by retirement?

TAGGED: Retirement
Make Financial Center July 24, 2024 July 24, 2024
Share This Article
Facebook Twitter Copy Link
Previous Article 4 Ways To Tell If A Stock Is Overvalued 4 Ways To Tell If A Stock Is Overvalued
Next Article Survey: Mortgage Lock-In Effect Still Going Strong Survey: Mortgage Lock-In Effect Still Going Strong
Leave a comment Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Latest News

Mature couple at the beach
Consider this strategy to target £25,000 in retirement income from a Stocks and Shares ISA
Retirement June 21, 2025
Are Annuities A Safe Investment In A Recession?
Are Annuities A Safe Investment In A Recession?
Investing June 21, 2025
Google Launches ‘Search Live’ Real-Time Voice Search In AI Mode
Google Launches ‘Search Live’ Real-Time Voice Search In AI Mode
Marketing June 20, 2025
Middle-aged Caucasian woman deep in thought while looking out of the window
Forget the State Pension! Here’s how to target a comfortable retirement income with £500 a month
Retirement June 19, 2025
Hidden Risks Of Index Funds: What Investors Should Know
Hidden Risks Of Index Funds: What Investors Should Know
Investing June 19, 2025
Why Content Is Important For SEO
Why Content Is Important For SEO
Marketing June 18, 2025

You Might also Like

Mature couple at the beach
Retirement

Consider this strategy to target £25,000 in retirement income from a Stocks and Shares ISA

June 21, 2025
Middle-aged Caucasian woman deep in thought while looking out of the window
Retirement

Forget the State Pension! Here’s how to target a comfortable retirement income with £500 a month

June 19, 2025
Is a £500k SIPP enough for retirement?
Retirement

3 techniques to turbocharge your SIPP for a richer retirement!

June 17, 2025
A senior group of friends enjoying rowing on the River Derwent
Retirement

£5,000 invested in a SIPP 5 years ago could now be worth…

June 13, 2025

About Us

Welcome to MakeFinancialCenter, your go-to resource for all things finance. We are dedicated to providing insightful and practical information to help you make informed financial decisions.

Quick Links

  • Investing
  • Banking
  • Credit Cards
  • Mortgages
  • Money Management
  • Marketing
  • Retirement
  • Investing
  • Banking
  • Credit Cards
  • Mortgages
  • Money Management
  • Marketing
  • Retirement

Trending News

Mature couple at the beach

Consider this strategy to target £25,000 in retirement income from a Stocks and Shares ISA

Average Money Market Account Rates for April 2024

Average Money Market Account Rates for April 2024

7 Of The Weirdest, Wildest, Oddball ETFs

7 Of The Weirdest, Wildest, Oddball ETFs

Mature couple at the beach
Consider this strategy to target £25,000 in retirement income from a Stocks and Shares ISA
June 21, 2025
Average Money Market Account Rates for April 2024
Average Money Market Account Rates for April 2024
April 10, 2024
7 Of The Weirdest, Wildest, Oddball ETFs
7 Of The Weirdest, Wildest, Oddball ETFs
April 10, 2024
Teaching My Two Young Daughters About Money
Teaching My Two Young Daughters About Money
April 10, 2024
  • About Us
  • Contact Us
  • Disclaimer
  • Privacy Policy
  • Terms of Service
© 2024 All Rights Reserved | Powered By Make Financial Center
Welcome Back!

Sign in to your account

Lost your password?