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Forget the Cash ISA! I’m backing the Standard Life Aberdeen share price for its 8% yield

The Standard Life Aberdeen share price is recovering strongly from the stock market crash. Better still, the FTSE 100-listed asset manager now offers one of the most generous yields on the entire UK stock market.

Today, Standard Life Aberdeen (LSE: SLA) gives you dividend income of 8.22% a year. That is incredible, especially when you consider the alternatives. Such as leaving your money to die a slow death inside a Cash ISA.

Generating growth and income from FTSE 100 dividend stocks like this one is a great way to build your long-term wealth. You can reinvest the dividends while you are still working, and draw them as income in retirement.

The Standard Life Aberdeen share price recovers

I would much rather invest in Standard Life Aberdeen than leave my long-term wealth inside a Cash ISA. At the start of the year, the average easy-access Cash ISA paid a derisory 0.85%, according to Moneyfacts. Today, savers get just 0.45%. That is beyond derisory.

The Bank of England is likely to keep interest rates near zero for years. This means there is no respite in sight for savers. You can try shopping around for a best-buy Cash ISA, but banks and building societies now pull their top deals quickly, after being swamped with demand. High street banks aren’t even competing for your savings.

Investing in FTSE 100 shares is riskier than leaving money in cash. At least in the short term. Dividends are not guaranteed either. Almost half of all FTSE 100 companies have cut or suspend their shareholder payouts, during the pandemic.

By contrast, Standard Life Aberdeen has stood by its payout, which has helped to support its share price.

This FTSE 100 income stock aims to please

In April, chairman Sir Douglas Flint made a clear statement of responsibility to shareholders, saying: “Many of our small shareholders rely on a dividend cheque. I think if companies can maintain their dividend in times like these, then it helps enormously.”

That is why I find Standard Life Aberdeen so irresistible today. It offers one of the highest yields in the UK, and feels a duty to pay it when possible. Better still, Flint said the group can afford it.

No wonder the Standard Life Aberdeen share price is up 20% in the last month. With dividend income in short supply, the attraction is clear. Its performance is particularly impressive given that asset managers typically struggle in a downturn. The reason is obvious. Funds perform poorly, and custom outflows rise.

This also makes them a good way to play the recovery. The Standard Life Aberdeen share price is on the up. While markets are likely to be volatile, as the global economy eases out of the lockdown, the long-term outlook should be brighter.

For the Cash ISA by contrast, the future looks grim.

A top income share that boasts a reliably defensive business model… plus a current forecast dividend yield of 4.2% to boot!

With global markets in turmoil as the coronavirus pandemic tightens its grip, turning to shares to generate income isn’t as simple as it used to be…

As the realities of ‘life under lockdown’ begin to bite, many of the stock market’s ‘go-to’ high-yielding companies have either taken an axe to their dividend pay-outs… or worse, opted to suspended them altogether – for the near-term at least.

With so many blue-chip and mid-cap companies scrambling to hoard cash right now, where are we income investors to turn for decent yields?

Fortunately, The Motley Fool is here to help…

Our analyst has unearthed what he believes could be a very attractive option for income- seeking investors – a company that, in his view, boasts a ‘reliably defensive’ business model, combined with a current forecast dividend yield of 4.2% to boot!*

But here’s the really exciting part…

This business even has form in riding out this kind of situation, too… having previously increased sales and profits back in 2008 and 2009 when the world was gripped in the deepest economic crisis since the Great Depression.

*Please be aware that dividends are variable and not guaranteed.

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Harvey Jones 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.