Business & Investment

Buy these two FTSE 100 dividend shares to retire with passive income

When I retire, I plan to use my portfolio of dividend stocks to earn passive income.I’ll look at two today FTSE 100 I think the dividend stock has the long-term quality I need to raise money after retirement.

Global growth trends

Most developed countries around the world report an aging population. While fertility rates are declining, more people are living longer. At the same time, the economic development of emerging markets is driving demand for improved healthcare and consumer goods.

These trends suggest to me that the demand for modern health care may increase for the foreseeable future.This is one of the reasons I chose the FTSE 100 Pharmaceutical Group GlaxoSmithKline (LSE: GSK) For my first pick.

GSK missed a rally that many pharmaceutical companies enjoyed last year. This was partly because people were moving away from doctors’ surgery and sales of the regular vaccine business suffered during the blockade.

However, the group is improving. New drug sales increased 12% to £ 2.5 billion in the third quarter, accounting for 30% of total sales. Glaxo also remained very profitable with an operating margin of 22%.

I think this progress will continue. We are also positive about the outlook for the consumer healthcare business, which owns the following brands: Sensodyne And Nicorette. Boss Emma Walmsley plans to spin this division into a new company next year or so.I have this Release value for shareholders..

Glaxo’s unloved status means that this FTSE 100 dividend stock is currently trading at just 12 times its projected earnings. Equity dividends have not been reduced for 15 years and currently offer a yield of 5.7%. I think GSK stocks look too cheap. If the company’s 2020 performance shows continuous progress, I would like to raise its share price.

I already own a chunk of GSK stock, but I’m thinking of buying more.

Still growing after 185 years

Companies with a long history are not Guaranteed To survive. However, I think the long and successful history is a good clue that the business will continue to evolve and grow. One of the longevity companies I value very much is the pension and insurance companies. Legal & General Group (LSE: LGEN)..

Legal & General First life insurance policy In 2019, the company reported £ 1.196 trillion in assets under management and generated £ 2.1 billion in pre-tax profit. Shareholders received a dividend of £ 1.1 billion, all of which was covered by surplus cash.

In recent years, the company’s strategy of acquiring corporate pension plans has supported continued growth. In 2019, sales of so-called pension risk transfers totaled £ 11.4 billion. This allowed Regal & General to increase dividends on a regular basis while maintaining a good level of revenue coverage.

Looking to the future, CEO Nigel Wilson said dividend payments are expected to total £ 5.6bn to £ 5.9bn between 2020 and 2024. That’s about 36% of the current stock price.

Investors are worried about low interest rates and the outlook for the global economy, and legal and general stock prices were fixed last year. This will bring the stock price to just nine times the expected return and a dividend yield of 6.6%. I would like to purchase this FTSE 100 dividend stock for my portfolio.

Five stocks to try to build wealth in 50 years

Markets around the world are upset by the coronavirus pandemic …

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Roland head I own a stake in GlaxoSmithKline. Motley Fool UK recommends GlaxoSmithKline. The views expressed about the companies mentioned in this article are those of the author and may differ from the official recommendations made by subscription services such as Share Advisor, Hidden Winners, and Pro. Here at The Motley Fool, by considering different insights, Better investors than us.



Buy these two FTSE 100 dividend shares to retire with passive income

https://www.fool.co.uk/investing/2021/01/24/id-buy-these-2-ftse-100-dividend-stocks-to-retire-on-a-passive-income/ Buy these two FTSE 100 dividend shares to retire with passive income

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