2 top dividend stocks with 6% yields

first_img The Motley Fool UK’s Top Income Stock… Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Dividend investing is a powerful strategy that can help my wealth accumulate over time. There are two important factors when it comes to building long-term wealth. One is the longer duration I can give to allow my investments to grow, the better. The other is topping up the pot. Dividend reinvesting is one way to top up the pot with little effort.Get started nowWhen it comes to time, the here and now matters. Getting started right away is always preferable to putting it off. It doesn’t matter if I can only afford to invest a small amount each month, what counts is that I start.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…The power of compounding means that gradual-but-steady investments build up over time. The key lies in getting started. Putting it off until later achieves nothing. It’s been proven time and again that the younger investors are when they start in the stock market, the more likely they’ll bank considerable sums in the future.The younger the betterInterest rates also matter. The higher the interest earned on an investment, or via the dividend yield, then the faster I can accumulate wealth. For instance, if I invest a lump sum of £2,000 and regularly top up £250 a month from age 19, earning interest at 5% a year, I can accumulate over £536k by the time I’m 65.If I start at age 26, then I can only expect to achieve £363k by retirement.Meanwhile, if the interest rate is 9%, then by investing from age 19 to 65 I can expect to achieve £1.8 million, and from age 26 just over £1 million.I think this captures the power of compound interest and the importance of getting started from as young an age as possible, even though I also know I might not achieve those returns.Two dividend stocksSo with all that in mind, here are two dividend stocks with yields over 6% that I’d consider buying today.FTSE 100 stock Legal & General is a major insurance and pensions provider with several revenue streams. It’s a well-established and recognised brand. As a dividend stock, I find it attractive because I think it’s not overpriced and offers a generous yield. The Legal & General price-to-earnings ratio (P/E) is 10, earnings per share (EPS) are 27p and its dividend yield is 6%. Dividend cover is only 1.5 times earnings, so that makes it more at risk if the company runs into trouble, but I’ll take my chances for now. We think that when a company’s CEO owns 12.1% of its stock, that’s usually a very good sign.But with this opportunity it could get even better.Still only 55 years old, he sees the chance for a new “Uber-style” technology.And this is not a tiny tech startup full of empty promises.This extraordinary company is already one of the largest in its industry.Last year, revenues hit a whopping £1.132 billion.The board recently announced a 10% dividend hike.And it has been a superb Motley Fool income pick for 9 years running!But even so, we believe there could still be huge upside ahead.Clearly, this company’s founder and CEO agrees. I’ve started later in life, but I think the power of compounding can still help me generate a decent nest egg. That’s why I like dividend stocks to set me up for a financially healthy future. Image source: Getty Images. I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Enter Your Email Address Our 6 ‘Best Buys Now’ Shares Learn how you can grab this ‘Top Income Stock’ Report now Top global mining company Rio Tinto has seen its share price soar in the past year. It’s prone to volatility, but its 6% dividend yield helps calm the ride. The FTSE 100 stock has a P/E of 14 and EPS are 426p. I think Rio Tinto should be monitored more closely than other dividend stocks due to the cyclical nature of mining. But for now, commodities are in rising demand and for that reason I’d buy shares in this miner for my Stocks and Shares ISA. For regular stock market investing ideas and help choosing the best shares to buy now, sign up to The Motley Fool today. Kirsteen Mackay | Thursday, 3rd June, 2021 | More on: LGEN RIO See all posts by Kirsteen Mackay Kirsteen has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. 2 top dividend stocks with 6% yields Simply click below to discover how you can take advantage of this.last_img

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