With interest rates at ultra low levels and unlikely to improve any time soon, it is becoming nearly impossible for investors to generate a sufficient income from term deposits and savings accounts.
But never fear! The Australian share market is home to a large number of quality dividend shares that offer vastly superior yields.
Three such ASX dividend shares are listed below. Here's why I think they are great options for income investors:
BWP Trust (ASX: BWP)
The first ASX dividend share to consider is BWP. I believe the real estate investment trust is well-positioned to deliver consistent income and distribution growth over the next decade. This is thanks to its high quality commercial assets which are predominantly leased to home improvement giant, Bunnings Warehouse. I believe Bunnings is one of the best retailers in the country and the risk of store closures and rental defaults is very low. At present I estimate that its units offer a forward 4.8% yield.
Commonwealth Bank of Australia (ASX: CBA)
If you don't already have exposure to the banking sector, then I think Commonwealth Bank would be a good dividend share to buy. I believe it is the best option in the sector due to the quality of its business, brand, and balance sheet. And while trading conditions are tough now, I expect these headwinds to ease in the coming months. So, with its shares still down materially from their high, now could be an opportune time to make a long term investment. I estimate that its shares offer a fully franked 5.8% FY 2021 dividend yield.
Dicker Data Ltd (ASX: DDR)
A final ASX dividend share to consider buying is Dicker Data. It is a distributor of computer hardware and software products across Australia. The company has been growing its earnings and dividend at a consistently solid rate for many years. The good news is that this positive trend looks set to continue thanks to new vendor agreements and strong demand. This year the Dicker Data board intends to lift its dividend by 31% to 35.5 cents per share. This represents a 4.5% fully franked dividend yield.
