Given the heightened levels of market volatility that we are experiencing at present, it is likely to be a nervous time for retirees.
But don't worry because there are ASX 200 shares out there that could be described as safer options.
Let's take a look at two that analysts rate as buys:
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APA Group (ASX: APA)
The first safe ASX 200 share to look at is APA Group. It is regarded as a lower risk option due to its defensive business. APA Group is an energy infrastructure company and owner of a $27 billion portfolio of gas, electricity, solar and wind assets.
It delivers around half of the nation's domestic gas through 15,000 kilometres of gas pipelines that it owns, operates and maintains. In addition, through its investments in electricity transmission assets, it connects Victoria with South Australia, Tasmania with Victoria, and New South Wales with Queensland. This provides vital flexibility and support for the grid.
These assets have underpinned consistent earnings and dividend growth for almost two decades.
And the good news is that Macquarie believes that this trend can continue. It is forecasting dividend increases to 57 cents per share in FY 2025 and then 58 cents per share in FY 2026. Based on the current APA share price of $7.58, this equates to dividend yields of 7.5% and 7.65%, respectively.
The broker also sees decent upside for its shares with its outperform and $8.14 price target.
Telstra Group Ltd (ASX: TLS)
Another ASX 200 share that could be described as a safe option is Telstra. It is of course Australia's leading telecommunications company with 22 million mobile subscriptions across the country.
As internet and mobile phones are must-haves for most Australians, demand for them remains consistent whatever is happening in the economy. In addition, competition in the telco industry has been rational in recent times and prices have been increasing across all major operators.
Goldman Sachs recently named Telstra as a buy, partly due to its defensive qualities. It advised that the company is its "preferred defensive name into CY25."
This is partly because it is "confident in its ability to deliver Mobile/InfraCo growth, ongoing cost efficiencies, and strong shareholder returns benefiting from portfolio mgmnt/mid-single digit DPS growth."
The broker believes that this will underpin fully franked dividends of 19 cents per share in FY 2025 and then 20 cents per share in FY 2026. Based on the current Telstra share price of $4.09, this would mean dividend yields of 4.6% and 4.9%, respectively.
Goldman has a buy rating and $4.50 price target on the ASX 200 share.
