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Having time on your side always helps, but it’s never too late to start investing in the stock market. An investor starting at the age of 50 still has around 17 years before becoming eligible for the State Pension. And UK stocks can be a good place to look for those trying to build wealth. From the FTSE 100, there are a couple in particular that stand out to me.
Building wealth after 50
Building wealth through the stock market is about buying shares that are going to be worth more than they are today. And that means finding companies that can grow their earnings.
Ideally, this happens for a long period of time. But someone looking to retire in 17 years needs to be wary of a business that isn’t going to return cash to shareholder for another two decades.
That means investors looking to build wealth after 50 should focus on companies that can grow while returning cash to shareholders. Finding those, however, isn’t always straightforward.
Fortunately, the FTSE 100 has a couple of names that fit the bill. And 17 years is definitely enough time to generate meaningful wealth.
Games Workshop
I think Games Workshop (LSE:GAW) is an excellent example. The company’s main asset is intangible – it’s the intellectual property around the Warhammer franchise.
As a result, the firm returns most of the cash it generates to investors, rather than reinvesting it to try and boost sales. Despite this, the business has grown spectacularly over the last 10 years.
Investors need to be wary of inflation. Games Workshop’s factories are based in Nottingham, making it vulnerable to UK energy prices – already some of the highest in Europe – rising further.
Overall, though, investors wanting to try and build wealth after 50 should definitely take a closer look. The combination of growth and dividends is one that deserves serious attention.
Bunzl
Bunzl (LSE:BNZL) is another business with an outstanding growth record. But the stock went off the rails earlier this year as a shift to own-brand products resulted in the loss of a major customer.
That’s not great, but the firm is making moves to recover the situation. And if it can get things under control quickly, I think the current share price could be a huge opportunity.
Most of the FTSE 100 distributor’s growth comes from acquisitions, which can be risky. If the company pays too much in trying to expand, it could be bad for shareholder value.
Bunzl, however, has an outstanding record in this regard and that’s reflected in what has been a very consistent record of dividend growth. I think it’s well worth checking out.
Opportunities
The UK stock market isn’t necessarily the first place that comes to mind when it comes to growth. I think, though, there are some individual names that have very strong prospects.
Importantly, they also typically focus on returning this to shareholders as dividends. And this means investors wanting to build wealth over the next 15 years or so should definitely take a look.
