Dividend shares is usually a nice supply of passive earnings. However when you’re over 50, that you must be selective along with your inventory picks to minimise threat.

Right here, I’m going to focus on two dividend payers I believe could possibly be nicely suited to these aged over 50. Each provide engaging yields immediately but additionally have the potential to generate respectable capital beneficial properties over the long term.

A London-based property firm

First up we’ve Workspace Group (LSE: WKP). It’s an actual property funding belief (REIT) that provides versatile workplace house options throughout London.

The dividend right here’s engaging. For the present monetary 12 months (ending 31 March), the REIT’s anticipated to pay out 29.5p in earnings. That equates to a yield of round 4.5%. On condition that UK rates of interest are falling, that could possibly be considerably increased than the charges money financial savings accounts are providing in 12 months’ time.

Wanting past the yield, there are a number of issues I like about this inventory. One is that it stands to learn from decrease rates of interest. Within the years forward, decrease charges ought to scale back the REIT’s curiosity expense (it had web debt of £828m on the finish of March) and increase profitability.

One other is that it seems nicely positioned to learn from the shift again to the workplace. Right this moment, firms throughout all industries are making strikes to get staff again into the workplace and this might improve demand for workplace house.

It’s value noting that administration sounded fairly assured in regards to the outlook in July: “Looking ahead, our scalable operating platform puts us in a strong position to continue to deliver near and long-term income and dividend growth, and we move into the second quarter of the year with positive momentum,” mentioned CEO Graham Clemett.

In fact, financial weak spot is a possible threat right here. This might briefly scale back demand for workplace house.

In the long term nevertheless, I believe this REIT ought to do nicely on the again of London’s thriving start-up scene.

The second inventory I need to spotlight is Tesco (LSE: TSCO). It’s the biggest grocery store operator within the UK with a near-30% market share.

The yield right here isn’t super-high immediately. Wanting on the dividend forecast for the monetary 12 months ending 28 February (12.9p per share), it’s about 3.5%.

However analysts anticipate a wholesome degree of dividend development within the years forward. Subsequent monetary 12 months, the payout’s anticipated to climb to 14p per share, which pushes the yield to three.8%. It’s value noting that Tesco’s dividend protection (the ratio of earnings to dividends) is excessive. So there’s loads of scope for future dividend will increase.

Now, Tesco operates in a aggressive business. Within the years forward, it’s prone to face intense competitors from rivals corresponding to M&S, Asda, and Aldi, so its market share could possibly be in danger.

One factor that might give it an edge nevertheless, is its Clubcard scheme. Right this moment, the corporate has over 20m Clubcard members. Because of this it’s in a position to accumulate a ton of knowledge from its prospects. The extra knowledge it could possibly accumulate, the higher positioned it will likely be to prosper going ahead.

General, I believe the inventory provides a pleasant mixture of development potential and defence. That’s why I see it as a superb inventory for these over 50 to contemplate.