2 FTSE 100 growth dividend stocks that could turbocharge your retirement fund

Royston Wild looks at a pair of FTSE 100 (INDEXFTSE: UKX) stocks that could make you a fortune by retirement.

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If you’re worried that you might not be saving enough for retirement, you may or may not be surprised to hear that you are not alone.

Fret not, though. It’s never too late to start saving for when you hang up your work boots, even if you’re banging on the door of your planned retirement date. There are plenty of top stocks in the FTSE 100 alone that could help you generate a tidy income stream during your autumn years. The shares I detail below are just a couple of them.

A great place

St James’s Place (LSE: STJ) is expected to endure a little more earnings turbulence in 2018, a 6% decline currently predicted by City analysts.

But as I noted last time around in April, the rate at which net inflows are growing — up by almost a third during January-March, according to the most recent financials — encourages me that the outlook is strong for the medium term.

The number crunchers concur that the medium-term outlook for St James’s Place is robust and they are consequently expecting a bounce back into earnings expansion in 2019, an 18% year-on-year improvement currently anticipated.

This great profits outlook and strong record of cash generation (operating cash soared 39% in 2017 to £315.2m, for example) has enabled the financial giant to keep lifting dividends at a formidable rate. These have jumped 169% over the past five years alone, culminating in last year’s 42.86p per share reward, and additional progress, to 49.1p and 56.9p, is forecast by the Square Mile for 2018 and 2019 respectively.

Yields stand at a mighty 4.1% for 2018 and 4.7% for 2019 as a result. These monster readings, and the likelihood that yields should continue demolishing those of the broader market for years to come, more than takes the sting out of St James’s Place’s high paper valuation, a forward P/E ratio of 24.2 times.

Shining in developing markets

Conditions might be tough for Reckitt Benckiser’s (LSE: RB) Western divisions right now but I remain convinced that, thanks to the strength of its broad stable of household products and the unrivalled customer loyalty that they command, the stock also remains an attractive long-term investment destination.

As I noted in April, I remain particularly impressed by the progress it continues to make in emerging nations, and particularly in fast-growing Asian markets like China and India, plus Latin American powerhouse Brazil. And the Footsie firm can only expect revenues from such regions to continue surging as population levels and personal disposable incomes both storm higher.

Against this backcloth, earnings growth of 3% and 8% are projected for 2018 and 2019 respectively, and which support predictions of further dividend growth — last year’s payout of 164.3p per share is expected to grow to 168.1p next year and to 180.4p the year after.

These figures yield a very handy 2.6% and 2.8%. What’s more, Reckitt Benckiser carries an undemanding forward P/E ratio of 19.4 times. I reckon the company, like St James’s Place, is a great share to buy today and to hold for the years to come.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Royston Wild 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.

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