Later today the Reserve Bank of Australia is widely expected to keep rates on hold at the record low of 1.5% for yet another month.
Whilst this means at least another month of low interest rates for savers, the likelihood is that it'll be a long time before bank accounts and term deposits offer anything comparable to the rates that were available in the years prior to the Global Financial Crisis.
So rather than leaving money in a savings account to gather dust or in a low yield term deposit, I would suggest savers consider one of the many high yield dividend shares on the Australian share market.
Here are three to consider:
Mantra Group Ltd (ASX: MTR)
Whilst it isn't the biggest yield on the market, I believe the tourism boom will allow this leading accommodation provider to grow its trailing fully franked 3.5% dividend significantly over the next few years. As demand for rooms increases I expect Mantra to enjoy higher room rates and occupancy levels, ultimately leading to strong bottom line growth.
Retail Food Group Limited (ASX: RFG)
Although this food and beverage company had a reasonably average year, I think the sell-off of its shares has been largely overdone. So with its shares changing hands at approximately 10x trailing earnings and providing a trailing fully franked 6.8% dividend, I think investors have an opportunity to snap up shares at a very attractive price.
Westpac Banking Corp (ASX: WBC)
The shares of Australia's oldest bank currently provide investors with a trailing fully franked 5.8% dividend. Not only is this one of the biggest yields on the market, but it dwarfs the interest rates on offer from the bank's savings accounts. In light of this, I would sooner own its shares than have my money in one of its accounts.
