8%+ yields! Here are 2 of the best FTSE 100 dividend shares to consider buying

This Fool’s been searching the UK stock market to find the best dividend shares. Here are two he thinks investors should consider buying.

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In recent years, I’ve made a conscious effort to bolster my second income. That’s why I’ve been buying dividend shares.

In my opinion, it’s the easiest way to start generating streams of passive income. By buying high-quality businesses with handsome yields and reinvesting what I earn, I’m hoping to set myself up for a more comfortable retirement.

The average FTSE 100 yield is 3.9%. I’ve found two stocks that offer payouts of over 8% and, I think, they’re top-quality businesses. I reckon investors should consider buying them today.

My first pick is Legal & General (LSE: LGEN). The insurance and asset management stalwart yields 8.2%. That’s the fifth highest on the Footsie.

While that’s impressive, what I’m more drawn to is the actions the firm’s taken around maximising shareholder returns lately.

I always look for companies that have been increasing their payout. In the last decade, Legal & General’s dividend’s increased by over 80%, so it ticks that box.

Furthermore, the firm is on track with its five-year cumulative dividend plan, set to finish this year. That will have seen it return up to £5.9bn to shareholders.

I’d never buy a company for its dividend alone. But aside from its meaty yield, there are other reasons I like the stock. Legal & General is a market leader in an industry that’s set to see demand steadily rise.

With an ageing population, the need for its products should continue to creep up in the years and decades to come.

That’s not to say there won’t be blips along the way. We’re seeing that right now as ongoing economic uncertainty’s led to some customers pulling out of funds. That means its assets under management have wobbled recently.

But in the long run, I think Legal & General can prosper. Coupled with its bulky yield, it also looks cheap, trading on just 9.8 times forward earnings.

M&G

Sticking with the financial theme, next up is M&G (LSE: MNG). The stock yields a mighty 9.6%, one higher than its counterpart and the fourth highest on the Footsie.

I think the business is in a good position to keep increasing its payout. It has a strong balance sheet with a Solvency II ratio of 203%. That means it can continue to reward shareholders while simultaneously investing to keep growing.

With that, analysts predict that M&G’s earnings will grow at 19% a year on average to the end of 2026.

M&G has a lot of similarities to Legal & General. It has strong brand recognition, a large customer base and operates in a sector that’s set to see demand for its products increase in the years to come.

It means the like Legal & General, M&G has suffered recently due to the economic environment. Choppy conditions could cause clients to pull their money. Any delay to interest rate cuts could also see the M&G suffer.

But even so, the stock looks cheap, trading on 8.8 times forward earnings. And with rate cuts expected this year, M&G and Legal & General should be provided with a boost. I think both could be smart buys today.

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.

Charlie Keough has positions in Legal & General Group Plc. The Motley Fool UK has recommended M&g Plc. 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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