I don't plan to retire. The great thing about investing is that you can do it well into your later years. Billionaire Warren Buffett just turned 84 and his business partner Charlie Munger is now 90 and they're still at it with multi-billion dollar business acquisitions.
But you can't get around planning for retirement.
Below is a short list of stocks that have what I think is important for my retirement portfolio:
– generous yield and growing dividend payments
– durability to last as long as I do
– good earners that are financially strong and reliable
CSL Limited (ASX: CSL)
The largest ASX-listed biopharmaceutical, it develops and produces medical products for blood disorders and diseases. I imagine there will be more demand for this business in the future than even now. It had an average 24.9% annual total shareholder return over the past ten years and yields 1.8% currently. It could become a future blue-chip stock.
BHP Billiton Limited (ASX: BHP)
I may not be big on mining stocks, but this one will probably be around in 20 to 30 years' time. Actually, despite mining industry ups and downs, it has grown its dividend payments by an average 15% annually in the last ten years. It is growing its business in petroleum and potash for fertiliser, and is the most diversified miner in Australia. It has a 3.7% yield fully franked.
SEEK Limited (ASX: SEK)
The operator of seek.com.au, Australia's number one job search website, had another strong earnings increase with underlying net profit up 27% in FY 2014. Since 2009, both earnings and revenue have tripled and its stock has risen an average 23% annually for five years. It's more of a high growth stock now, but later on as it matures, I could see it also becoming a blue-chip stock paying a healthy dividend yield.
Transurban Group (ASX: TCL)
The infrastructure company owns, operates and manages a large portfolio of toll roads and tunnels in Sydney, Melbourne, Brisbane and near Washington D.C. in the US. Toll roads have strong competitive advantages and income streams that can last for decades. Car traffic never decreases, only new roads are built. Transurban can steadily add to its portfolio – and dividends – over the coming decades. It offers a hefty 4.8% yield.
If you prepare for your retirement now, then when you are a ripe old age, your biggest concern may be which tropical beach to spend your six-week winter holiday on.
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