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Retirement savings: I’d buy these 2 bargain FTSE 100 shares to become an ISA millionaire

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The FTSE 100 has gained 10% in the last month, but continues to offer a number of stocks that appear to trade at attractive prices. As such, now could be a buying opportunity for long-term investors who are looking to build a retirement nest egg.

With the index having a strong track record of generating annual total returns of around 8%, it could even offer the potential to generate a seven-figure ISA over the coming years.

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Here are two FTSE 100 shares that could help you to obtain a £1m+ ISA due to their growth potential and appealing valuations.

Rightmove

FTSE 100 online property platform Rightmove (LSE: RMV) has experienced a significant amount of disruption in 2020. The property market essentially shut down for a number of weeks. During this time, the company sought to help its members through offering measures such as discounted rates. It also decided to suspend its financial guidance for the current year and cancel its dividend.

These measures may have caused the company’s shares to decline heavily in the first few months of 2020. But they have since delivered a strong recovery so that Rightmove now trades just 6% down year-to-date.

Looking ahead, the FTSE 100 company’s dominant position in the online property marketplace could allow it to deliver relatively high returns. It is forecast to post a 45% rise in net profit next year, which suggests it is set to bounce back from what is likely to be a disappointing 2020 financial year.

Since the stock currently trades on a price-to-earnings growth (PEG) ratio of just 0.7, it appears to offer a wide margin of safety. As such, now could be the right time to buy a slice of it as it delivers a likely financial recovery.

FTSE 100 telecoms company Vodafone

Another FTSE 100 share that has made strong gains over recent weeks is Vodafone (LSE: VOD). Its share price is also down just 6% since the start of the year as investors have become increasingly optimistic about the company’s long-term prospects.

Vodafone’s recent annual results showed progress is being made in aspects of its business such as efficiency gains, infrastructure investment and in becoming increasingly digital. These changes could lead to improving profitability over the long run that allows the stock to command a higher valuation.

The company also appears to offer a relatively resilient business model compared to its index peers. For example, it has maintained its dividend policy despite an uncertain macroeconomic outlook, while its financial outlook continues to be positive.

Therefore, with investor sentiment having the potential to weaken over the coming months should there be further economic uncertainty, Vodafone could prove to be a popular FTSE 100 share among risk-averse investors. As such, now could be the right time to buy it for the long run to improve your retirement prospects.

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Peter Stephens owns shares of Vodafone. The Motley Fool UK has recommended Rightmove. 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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