I think that one of the best ways to set yourself up for an early retirement is by having a passive income stream that is reliable and has the potential to grow over time.
In my opinion dividend shares are one of the best ways to achieve this and are especially useful once you reach retirement thanks to their regular pay checks.
The good news is that the ASX offers a number of reliable dividend shares that investors could consider as part of a diversified retirement portfolio. Three that I like are listed below:
Australia and New Zealand Banking Group (ASX: ANZ)
Although the banks are out of favour with the market right now, with the end of the Royal Commission in sight and the final report due early next year, I expect investor sentiment to slowly improve over the coming months. This could make it worth considering an investment in ANZ Bank now whilst its shares are still trading on below historical average multiples. In addition to this, its shares currently offer a trailing fully franked 5.9% yield.
Dicker Data Ltd (ASX: DDR)
I think that Dicker Data could be a great option for a retirement portfolio due to its strong business model, solid growth prospects, and generous dividend. In addition to this, the founder-led computer software and hardware wholesale distributor pays its dividend in quarterly instalments. This could be ideal for those looking for a more regular pay check. Based on its last close price, Dicker Data's shares offer a generous fully franked forward yield of 6.3%.
Ruralco Holdings Ltd (ASX: RHL)
Earlier this month this agribusiness company released its FY 2018 results and revealed a 5% increase in revenue to $1,900 million and a 10% lift in underlying net profit after tax to $28.8 million. The latter was at the top end of the guidance range management provided. The company's successful year was largely down to its geographical and activity diversification easing the impact of mixed seasonal conditions and challenging trading conditions. More of the same is expected in FY 2019, putting Ruralco in a solid position to grow its dividend further. At present its shares offer a trailing fully franked 4.9% dividend.
