Building and protecting your retirement nest egg should be the #1 priority of every investor. You can roughly count how many more years until you retire, but the bigger issues are:
— the amount you need to retire comfortably for your remaining years and,
— how you can earn the greatest amount of money until you stop working (note: really smart investors will also figure out how to keep earning well after they retire).
You can use a combination of superannuation, income annuities and direct share ownership to maximise your returns. However, the one that gives you the most flexibility in changing and improving your investing mix is owning high-yield stocks.
Smaller companies can offer high yields, but you want more predictable long-term returns. Here are five top blue-chip stocks that can give you that high yield and more certainty of future income and gains.
1) Westpac Banking Corp (ASX: WBC)
Of the Big Four banks, it offers the second-highest yield, 5.2% fully franked, but what I really am attracted to is Westpac's history of increasing dividends. That trend can add up greatly over many years.
2) Coca-Cola Amatil Ltd (ASX: CCL)
This is a classic value play right now. The company expects earnings to dip and the market clobbered it. The thing is, though, it is a short-term setback that management is tackling with a business restructuring. Long term, the company which bottles and distributes Coca-Cola and many other beverages in Australia can get back on track. It has a 5.5% yield partially franked that you can enjoy right now. Refreshing….
3) Woodside Petroleum Limited (ASX: WPL)
Getting energy industry exposure is good for your portfolio because it is booming as a growing Asia will need more power as it urbanises. It offers a 5.8% yield fully franked and a long-term growth picture with higher earnings could drive higher dividends as well.
4) Insurance Australia Group Limited (ASX: IAG)
Not only does the insurer with such well known brands as NRMA Insurance, CGU and SGIO have a great 5.8% yield fully franked, it has a good track record for raising dividends like Westpac. That's potentially higher dividend payments in the future if they maintain the trend.
5) Suncorp Group Ltd (ASX: SUN)
This may be another insurance and banking company for this group, but in addition to the 5.1% fully franked yield, Suncorp intends to return surplus capital to shareholders in the near future. That could mean a special dividend, which it has a nice history of paying out. Or it could be possible increases in regular dividend payments. Either way, that should mean more dividend income for shareholders.
