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3 high yield ASX dividend shares that smash low interest rates

James Mickleboro
stack of coins spelling yield

As I mentioned here at the weekend, the latest Westpac Banking Corp (ASX: WBC) Weekly report reveals that its economics team continue to forecast two rate cuts by the Reserve Bank in 2020.

The banking giant has pencilled in a cut to 0.5% in April and then a further cut to 0.25% in August.

Whilst this will be great news for borrowers, it will be the complete opposite for savers and income investors.

But don’t worry if you’re in the latter group, because these top dividend shares can help you smash low interest rates:

Aventus Group  (ASX: AVN)

One dividend share that I think is worth considering right now is Aventus. It is the largest fully integrated owner, manager and developer of large format retail parks in Australia. It currently owns 20 centres which are home to some of the biggest and most popular retailers in the country such as Bunnings, The Good Guys, Officeworks, and Domayne. The popularity of its centres with consumers has led to strong demand for tenancies and has supported a very high occupancy rate. I believe this positions it well for growth over the coming years. In the meantime, I estimate that its shares offer a forward 5.9% distribution yield.

BHP Group Ltd  (ASX: BHP)

Another good option for income investors could be BHP. As long as the coronavirus outbreak doesn’t stifle global economic growth, I expect demand for many of the commodities it produces to remain robust over the coming years and support favourable prices. Combined with the low costs of its world class operations, this bodes well for its free cash flow generation. I expect this to support generous dividends and share buy backs. Based on this, I estimate that BHP’s shares provide a fully franked forward 5.5% dividend yield.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

If you would like to invest in a large number of income shares but lack the funds to do it, then you could achieve this through a single investment in the Vanguard Australian Shares High Yield ETF. This popular ETF gives investors the opportunity to invest in 60 of the highest paying dividend shares on the Australian share market. Amongst its diverse holdings you’ll find the likes of BHP, Telstra Corporation Ltd (ASX: TLS), and the big four banks. This ETF currently offers income investors a forecast forward 5.3% dividend yield.

The post 3 high yield ASX dividend shares that smash low interest rates appeared first on Motley Fool Australia.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia has recommended AVENTUS RE UNIT. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2020