FTSE 100 Dividend shares are a brilliant way of generating both capital growth and retirement passive income.

Investors reach growth when share prices are rising and the second income at the summit from the regular dividend stream, most blue companies write investors for a prize for having their shares.

New investors often underestimate the value of shareholders. When I started, I focused only on the height. I did not notice diminutive, regular payments flowing in my actions and shares of ISA, usually paid twice, but sometimes four times a year.

FTSE 100 DEVIDEND HEROES

Fortunately, I set up my online trade account to automatically invest them back to the same supplies and slowly, I constantly noticed something. These dividends were spinning. They met and grew and added to my complete return.

Sometimes I was at the actual price of the action, but in general I found myself thanks to the reinvested dividends.

Dividends differ significantly. Quickly developing companies can offer only 1% or 2% income per year, while some income shares can bring up to 8% or 9%. Both have their place in a well -balanced portfolio.

I have several actions with ultra-wysoki yields, including the insurer Phoenix Group Holdingswhich has a long -lasting capacity of 7.8%and Taylor Wimpeywhich gives 9.3%, the largest on FTSE 100.

Halma is growing constantly

I used to raise my nose on wrestling Halma (LSE: HLMA), which has a low efficiency of only 0.72%. However, the global safety and safety specialist has great achievements in the field of growing dividends every year.

The group increased its annual dividend by at least 5% due to incredible 45 years in a row. Over the past five years, the average height has been only 7% per year.

The reason why the profitability is so low is that the price of the shares increased strongly. When the herd increases, the performance decreases, through basic mathematics.

The price of Halma shares has increased by 25% in the last 12 months, but over the past decade it has been over triple, with all dividends at the top.

Of course, there is no guarantee that it will get off again in the next decade. There is never action. Halma looks exorbitant today, with a price -to -profit price (p/e) ratio. It is much higher than P/E 15 perceived as a fair value.

As an international company, Halma risks the movements and tariffs of currency courses, but I think that it is still worth considering a long -term view.

Investing for retirement

When buying dividend shares, this is long -term. Let’s assume that the 30-year-old had 10,000 pounds in ISA and began to invest 100 pounds a month at the top. We also assume that they increased this sum by 5% per year, in order to protect against inflation, and generated an average annual return of 7% per year. At the age of 67 they would have 155 097 £.

If their portfolio had an average of 5%, it would give a passive income of 7,755 pounds a year. And this does not touch their capital. The more they invest when they are younger, the more income they will probably generate. A balanced wallet of about 15 to 20 FTSE 100 shares, offering income and growth, can transform the pension. However, this will not happen overnight.