3 ASX dividend shares that are perfect for retirement


The great Australian dream of kissing your working life goodbye and stepping into a retirement filled with well-earned R&R is made more attainable with the help of well-paying dividend shares.  

Retirees often rely on dividends to top-up their income stream and afford them life’s luxuries during their golden years.

Below are 3 ASX dividend shares that we believe are perfect for retirement.

Transurban Group (ASX: TCL)

While the perks of retirement usually include no longer having to battle peak-hour traffic on the way to the office, retirees can still take full advantage of Australia’s many toll-roads from the comfort of home – or abroad.  

The king of toll-roads in Australia, Transurban Group, manages and maintains toll-road networks in our major cities Melbourne, Sydney and Brisbane. The company has also expanded to the United States and recently Canada.

With the population increasing and our major cities becoming more and more congested, Transurban offer motorists quicker and more convenient options, which in turn boosts efficiency and generates billions of dollars each year for the economy.

The recent acquisition of 51% of WestConnex from the NSW Government plus other projects in the pipeline such as the West Gate Tunnel Project in Melbourne, expected to be completed in 2022, as well as the opportunity for road extensions and upgrades to its current network, leaves Transurban looking set to benefit from the increased population and resulting need for long-term transport solutions.

The Transurban share price is down 4.93% over the last 12 months, currently trading at $11.16.

Slated as one of The Capital Club’s top 6 dividend stocks on the ASX for 2018 and beyond, Transurban shares trades on a dividend yield of 4.96%.

Last month the company provided FY19 distribution guidance of 59 cents per share, an increase of 3 cents per share on its FY18 payout.

Tabcorp Holdings Limited (ASX: TAH)

While the growth potential of a company such as Tabcorp Holdings may be limited, the dividend prospects for retirees is quite attractive, especially since the age-old pastime of gambling won’t be going away anytime soon.

A number of reforms were introduced into the gambling industry over the past year, designed to make it more sustainable in the long-term. As more and more punters move to online gambling, regulatory changes have provided a more level playing field for gaming giant Tabcorp in the online gambling sector.

Tabcorp has reaped the benefits of improved digitalisation in FY18, with online revenue rising 16.3%, and the company appears to be well-placed to benefit and perform well in the improved operating environment going forward.

In fact, the Tabcorp share price has climbed 15.2% over the last 12 months, now trading at $4.89

Tabcorp reported a full year fully franked dividend of 21 cents per share in its recent full-year report, and with the TAH share price trading at close to $5, the shares trade on a fully franked dividend yield of 4.29%, or 6.12% when grossed up for franking credits.

Magellan Financial Group Ltd (ASX: MFG)

Sydney-based funds management business Magellan Financial Group could be a great addition for retirees relying on dividends to boost their income stream, thanks to its bold new dividend policy.

In its FY18 results report, Magellan committed to increasing its dividend payout ratio to 90% to 95% of profit after tax of its funds management segment, excluding performance fees. It also announced it would pay an annual performance fee dividend of 90% to 95% of net crystallised performance fees after tax.

As a result, the company reported a total fully franked dividend per share of $1.345 for the year, an increase of 57%. With the Magellan Financial Group share price currently trading at $27.11, it offers investors a fully franked dividend yield of 4.97%, or 7.09% grossed up.

In an impressive full-year result, Magellan’s funds under management (FUM) lifted from $69.97 billion to $74.61 billion, a rise of around 6%. With the scalable nature of the FUM business model, Magellan could continue to grow its funds, and therefore dividends, over the next few years with minimal capital expenditure.  

Here’s how you can strike it rich in the share market…

The best way to strike it rich in the share market is to buy shares that are not only cheap, but growing quickly.

Combining countless hours of research with over 30 years of hands-on stock market investing experience, The Capital Club’s founder Bruce Jackson has just published his definitive list of 3 Cheap and Good ASX Stocks for 2018.

Best of all, the report is absolutely free, exclusively for readers of The Capital Club.

In this comprehensive free report, you’ll find the name of one ASX gold stock that’s not only profitable, but trading at less than 4 times forecast profits.

You’ll also discover the name of a company one fund manager has called the cheapest stock in the ASX 100, and you’ll read about the three catalysts that could push the share price higher in the next six months.

Finally, the report names one of the cheapest retailers trading on the ASX, a company that just picked up the assets of a distressed competitor on the cheap, paying just 2 times earnings. No wonder one top fund manager thinks its share price could at least double.

With the share prices of each of these 3 companies having the potential to double or more, you’ll want to act now. Simply click here or the button below, enter your email address, and this free report will be instantly sent to you.

See the 3 stocks

Contributors to this article may own shares in some of the companies mentioned in this article. The Capital Club has a thorough disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
Lauren Surplice is a keen follower of the stock market, investing in individual companies and funds. She follows the daily stock market news, covering the ASX stocks that are moving the markets. You can contact Lauren at laurens@thecapitalclub.com.au