Forget term deposits! I'd buy these ASX dividend shares instead

Detailed summary

ASX dividend shares offer multiple benefits compared to banking products. The post Forget term deposits! I'd buy these ASX dividend shares instead appeared first on The Motley…

Savings products from banks look much more appealing these days after five rate rises from the Reserve Bank of Australia (RBA), taking the cash rate to 4.85%. While term deposit rates are higher npw, I think ASX dividend shares are still the winner for passive income.

When I look at offerings from banks like Commonwealth Bank of Australia (ASX: CBA) and Judo Capital Holdings Ltd (ASX: JDO), they have 12-month term deposit rates in the mid-5% range.

To compete with that sort of interest rate, I think investors should look at ASX dividend shares that provide a good yield and are delivering payout growth. It's the organic income growth that makes me prefer ASX dividend shares over term deposits.

If I spend all of my interest income in a year, I'm left with the original capital amount.

If I spend all of my dividends, I could still see a dividend increase in the following year.

With that in mind, I like the following businesses for the investment exposure and the payout growth they're delivering.

Industrial property seems like one of the best places to invest in the real estate world considering a number of tailwinds are boosting the rental potential.

Demand drivers like e-commerce adoption, refrigerated warehouses (for food and medicine), growing city populations and the onshoring of supply chains are all helping drive the rental income.

In the FY26 result, which was reported in August, the business reported that it achieved 5.2% like-for-like net operating income (NOI) growth.

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