Where to look for income now

Although there is much talk of rising interest rates in the coming years, investors seeking an income shouldn’t get too excited. The yield on ten-year gilts is still a measly 0.8% and very few mainstream savings accounts offer interest rates much above 1%. Corporate bond yields have started rising but the yield on the iShares UK corporate bond UCITS exchange-traded fund with maturities up to five years is still below 2%.

Central bankers, especially in the trend-setting US, seem keen to keep yields as close to zero as possible to reflate economies. In these circumstances income-hungry investors are