Forget the Cash ISA! I’d buy cheap FTSE 100 income shares to retire on

first_img “This Stock Could Be Like Buying Amazon in 1997” The recent decline in the stock market may convince some investors that buying FTSE 100 income shares for a retirement portfolio is too risky.Indeed, many companies have cut or cancelled their dividends in response to the uncertain outlook facing the world economy.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…However, some FTSE 100 income shares have bucked the trend.As such, despite the global economic uncertainty, buying stocks with defensive characteristics could be a sensible strategy for investors who are seeking a passive income.Following recent stock price falls, they could also offer the potential for a high total return when held as part of a diverse portfolio of stocks.FTSE 100 income shares on offer If you’re looking to build a passive income stream to retire on, defensive income shares are certainly worth considering. Companies with defensive characteristics are less likely to be impacted by changes in the outlook for the economy.Therefore, they’re less likely to cut their dividends to investors in an uncertain economic environment. This means defensive FTSE 100 income shares tend to be much better income investments than cyclical companies. Cyclical businesses can make a lot of money in good times, but earnings usually slump in times of economic uncertainty. Margin of safety However, despite the advantages of defensive stocks, the recent stock market decline has hurt investor sentiment towards them.That means many defensive FTSE 100 income shares now offer dividend yields that are above their historical averages. This suggests that now could be a great time to buy these income stocks. A high yield compared to history can be an indicator of a margin of safety. So, it looks as if many of these companies are now on special offer. This could be a great opportunity for investors with a long-term outlook. These undervalued income stocks may also offer the potential for capital gains over the long run.As investor confidence returns, defensive FTSE 100 income shares may become more popular alongside the broader stock market. These companies could also experience an improvement in demand as the global economy recovers. Diversified income Of course, the performance of any one company is never guaranteed. Even the most defensive company can experience unforeseen challenges. That’s why it may be sensible to build a basket of FTSE 100 income shares. Purchasing a diverse range of companies in different sectors, that have exposure to varied industries and geographies will reduce risk.It should also give you a more predictable income stream over the long term. By owning a diverse range of companies, even if one or two cut their payouts to shareholders, a passive income stream should still be available. So overall, after the recent stock market crash, there is now a range of FTSE 100 income shares that appear to offer a margin of safety. Buying a diversified basket of these stocks could help long-term investors generate a passive income stream in retirement.  Rupert Hargreaves | Sunday, 17th May, 2020 | More on: ^FTSE I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. 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Image source: Getty Images center_img 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. Our 6 ‘Best Buys Now’ Shares Forget the Cash ISA! I’d buy cheap FTSE 100 income shares to retire on 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 See all posts by Rupert Hargreaveslast_img

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