Search ASX code:
Generic filters

Search ASX code:
Generic filters

Search ASX code:
Generic filters

Search ASX code:
Generic filters

How Retirees Can Beat 1% Rates With Shares

Retirees are faced with a difficult decision of what to do with their money after the Reserve Bank of Australia (RBA) decided to cut interest rates again to 1%.

The Reserve Bank of Australia is Australia’s central bank. One of its biggest roles is to decide Australia’s interest rate, taking into account economic conditions including unemployment, inflation and the housing market. The RBA interest rate has a ripple effect across the whole economy.

How Retirees Can Beat 1% Rates With Shares

Term deposits just don’t seem worth it any more, do they? Particularly when you factor in inflation. In real terms people might be losing money with the money in the bank.

And who knows how long interest rates are going to stay this low? I think the best way to combat this is with shares. But there isn’t just one option, I think there are two:

Dividend Shares

The obvious way to make up for the loss of yield is to invest in ASX dividend shares. You wouldn’t need to put all of your money into dividend shares to make up the loss, depending on the yields you choose.

There are some shares that have very high dividend yields such as WAM Research Limited (ASX: WAX) and Naos Emerging Opportunities Company Ltd (ASX: NCC). However, I believe it’s important not to significantly overpay for any shares, which is why I’m wary of the valuations of Transurban Group (ASX: TCL) and Sydney Airport Holdings Pty Ltd (ASX: SYD).

However, I’m more attracted to the idea of investing in businesses which have a high chance of maintaining and growing the payment to shareholders such as businesses like Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) and Future Generation Investment Company Ltd (ASX: FGX).

Growth Shares

The other way is to generate returns from the capital growth of businesses, rather than the income.

Some of the best growth shares on the ASX, like Xero Limited (ASX: XRO), may or may not be too expensive with the current valuations.

There are other growth shares that may be cheap for the growth they could generate. It’s impossible to know which share prices will do well in the short-to-medium-term, but Webjet Limited (ASX: WEB), MNF Group Ltd (ASX: MNF) and MFF Capital Investments Ltd (ASX: MFF) could be some of the better performers over the next two to three years.

They aren’t the only growth shares could be exciting performers. The rapidly growing businesses in the free report below could also be good ideas.

Disclosure: Jaz owns shares of Washington H. Soul Pattinson and Co., Future Generation Investment Co and MFF Capital Investments at the time of writing, but this could change at any time.

Are you stuck wondering where to invest right now? Have you got cash 'sitting on the sidelines'? Are you looking for dividend income AND growth but don't know where to start? Rask's expert ASX analyst team has just released a full report, detailing where we'd invest $10,000 right now.

Not only are we offering these 11 investment ideas completely FREE, we've also released an in-depth podcast to go with the report!

So, whether you have $2,000 or $50,000, our brand new analyst report could help transform your watchlist. Right now, you can get the full analyst report emailed to you for FREE by CLICKING HERE NOW or simply entering your email below.

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.

Are you stuck wondering where to invest right now? Have you got cash 'sitting on the sidelines'? Are you looking for dividend income AND growth but don't know where to start? Rask's expert ASX analyst team has just released a full report, detailing where we'd invest $10,000 right now.

Not only are we offering these 11 investment ideas completely FREE, we've also released an in-depth podcast to go with the report!

So, whether you have $2,000 or $50,000, our brand new analyst report could help transform your watchlist. Right now, you can get the full analyst report emailed to you for FREE by CLICKING HERE NOW.

Information warning: The information on this website is published by The Rask Group Pty Ltd (ABN: 36 622 810 995) is limited to factual information or (at most) general financial advice only. That means, the information and advice does not take into account your objectives, financial situation or needs. It is not specific to you, your needs, goals or objectives. Because of that, you should consider if the advice is appropriate to you and your needs, before acting on the information. If you don’t know what your needs are, you should consult a trusted and licensed financial adviser who can provide you with personal financial product advice. In addition, you should obtain and read the product disclosure statement (PDS) before making a decision to acquire a financial product. Please read our Terms and Conditions and Financial Services Guide before using this website. The Rask Group Pty Ltd is a Corporate Authorised Representative (#1280930) of AFSL #383169.

LIVE ASX Chat - Join in!

Play Video

Keep reading:

Rask Analyst’s $10,000 Hypothetical Portfolio 

Rask Australia’s expert analysts have just released 11 stock & ETF positions they’d buy right now as part of a $10,000 hypothetical portfolio. 

Completely free, this report comes with the exact ticker codes, how much the analysts would invest and a detailed over the company and why we like it. Plus a 60-min podcast! 

Simply enter your email address and we’ll send you the report.

Unsubscribe anytime. Read our TermsFinancial Services GuidePrivacy Policy. We’ll never sell your email address. Our company is Australian owned.