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Have £5k to spend in an ISA? 2 FTSE 100 dividend stocks I’d buy to get rich and retire early

Market volatility continues to reign, but I believe buying FTSE 100 stocks is a good plan following some recent price falls.

I reckon buying into gold-exposed stocks is a particularly great idea too. Sure, buying into mining companies instead of the metal itself, or a financial instrument backed by gold, incurs extra risk. Pulling natural resources out of the ground is fraught with problems. But on the flip side, investors can enjoy the bonus of dividend payments.

And boy, Polymetal International (LSE: POLY) offers big rewards in this area. Its dividend yields sit north of 5% for both 2020 and 2021. In fact, the gold digger offers brilliant value all round, the Footsie firm sporting a forward P/E multiple of just 11 times too.

Why do I think Polymetal could make you rich? Well, the coronavirus outbreak adds to the severe macroeconomic and geopolitical turbulence that was already shaking investor confidence. You can expect flight-to-safety buying of precious metals to remain quite robust.

Gold medal

Investment demand for gold should also remain strong thanks to its role as a traditional currency. There are no signs that central banks will be turning off their money printers any time soon. Investors will keep switching into the hard currency as the value of paper currencies comes under increased scrutiny.

No wonder many market experts are expecting bullion prices to surge to fresh record highs before too long. Some are even expecting the price to barge through the $3,000 per ounce marker before long. This is why City analysts expect Polymetal’s earnings to rise 41% this year and 6% in 2021.

Another FTSE 100 hero

I’d also happily spend money on BAE Systems (LSE: BA) with a view to making big returns. Global defence spending has spiked in recent times as that geopolitical stress I mention above has intensified. And this growth trend is one that isn’t tipped to end just yet.

Research just released by ResearchAndMarkets.com illustrates my point. This suggests that a predicted global defence budget of $1.8trn in 2020 will expand at a compound annual growth rate of 2.7% for most of the decade. Thus total expenditure worldwide is tipped at $2.3trn for 2028.

Unsurprisingly North America is expected to maintain the world’s largest arms budget by the end of the period. And this bodes well for mega defence supplier BAE Systems, a major supplier of hardware and software to the US Department of Defence and one with a strong presence on the continent.

City brokers thus don’t anticipate the Footsie-quoted company will endure any long-term trading troubles following the coronavirus outbreak. They expect BAE Systems to bounce from an anticipated 3% drop in annual profits in 2020 with a 13% rise next year. Happily for value hunters these are projections that result in another rock-bottom forward P/E ratio of 11 times too.

This robust earnings outlook leads the number crunchers to tip more rises in the yearly dividend as well. And this means that the FTSE 100 firm boasts chubby yields of 4.6% for this year and 5% for 2021. Like Polymetal, I’d buy this share and hold it for the rest of the decade.

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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.