On Tuesday the Reserve Bank of Australia decided against taking the cash rate to zero and kept it on hold at 0.25%.
While this was a small win for savers and income investors, it doesn't change the fact that the interest rates on offer with savings accounts and term deposits are at ultra-low levels.
The good news is that you can beat these low rates by investing in ASX dividend shares. But which ones? Here are two top ASX dividend shares I would buy:
National Australia Bank Ltd (ASX: NAB)
If you have space in your portfolio for a bank share, then I think NAB could be worth considering. While it has certainly been a tough year for the banking giant, I believe the selling of its shares has been overdone and left them trading at an attractive level.
This is certainly the case for income investors, given the generous yield on offer with its shares. Based on the latest NAB share price, I estimate that it provides investors with a fully franked 5.2% FY 2021 dividend yield.
Telstra Corporation Ltd (ASX: TLS)
A final dividend share for income investors to consider buying is Telstra. I've been impressed with the progress of its T22 strategy and believe it will make Telstra a much stronger company in the future. In addition to this, it is worth noting that the NBN rollout is nearing completion. This means it may not be too long before this earnings headwinds eases and the company returns to growth again.
As a result, I think now would be a good time to consider a patient investment in its shares. Based on the current Telstra share price and my belief that its 16 cents per share dividend is sustainable for the foreseeable future, the telco giant currently offers a 4.7% fully franked dividend yield.
