Dividends are one of the best things about owning shares. You get to receive cash for no effort, just watch the income roll in.
Income is a good sign that the business is profitable, that management want to reward shareholders and that they won't waste capital trying to buy whatever they can at any cost to fund more growth.
Here are three shares I'd like to add to my income portfolio:
Arena REIT No 1 (ASX: ARF)
Arena is one of the biggest REITs that focuses on leasing out childcare properties.
The number of babies being born in Australia continues to boom and this should lead to an increase in attendance at childcare centres. This, combined with Australia's property boom, should see Arena continue to be a strong income choice.
Arena currently has a distribution yield of 5.48%.
Clime Capital Limited (ASX: CAM)
Clime is one of the smaller listed investment companies (LIC) on the ASX, but it has a big dividend yield.
This LIC looks at all areas of the ASX for investment ideas and also invests a small part of the portfolio overseas. Some of its largest positions include Ramsay Health Care Limited (ASX: RHC), Collins Foods Ltd (ASX: CKF) and Alphabet Inc.
Clime currently has a grossed-up dividend yield of 8.14%.
Australian Foundation Investment Co. Ltd (ASX: AFI) (AFIC)
This LIC is at the other end of the scale, it's the largest one on the ASX.
I often say that most Australian investors have too much exposure to the large end of the Australian market but I may actually have too little.
Instead of trying to pick my favourite bank I think the best route would be to buy a low-cost LIC that does that investing for me, such as AFIC.
It currently has a grossed-up dividend yield of 5.77%.
Foolish takeaway
None of these shares are likely to be clear market-beaters but I would like all of them to be a small part of my portfolio in time.
