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No. of Recommendations: 17
First of all -- I am not laughing. It is very important that you maximize your limited resources. I am bearing that fact in mind because I have been where you are, and while it isn't the worst place to be, there are better places you can go from there.

The simple answer to your question is... it depends.

However, more accurately, you need enough money to acquire that initial share that will qualify you for that company's DRiP plus the fees associated with acquiring that first share. If you are interested in starting a DSP, then at the least you will need $50 minimum, for a couple of plans that have that low $ minimum to over $1,000 plus for other DSPs.

Not all companies sponsor DRiPs, but you can figure out the ones that do as you amble through the site.

To open a DRiP, depending on the company you choose, the price can be anywhere from a few dollars to over $100 in some cases. It depends on the current share price. Bear in mind that if a share price is cheap, there is usually good reason for a cheap share price. Not always, but usually. I wouldn't focus as much on the price per share. You want to own a company that is worth owning. For example, Moneypaper will get you the share for the price of the share plus a 10% cushion plus $30 and set up the DRiP for you in most cases. There are other options that are less expensive, but there is more action required by you to get the plan started and rolling.

While it is important to acquire the initial share, because without it, you cannot participate in the DRiP, tied for importance is having (on a regular basis) enough money to continue investing through the DRiP. I say this because while the effects of compound interest through the dividends paid over time is a powerful tool, it is a much more effective tool when you build your stock ownership through Optional Cash Payments (OCPs) investments. If you start a plan that has monthly investment minimums of $500 per investment, and you can't afford it. It is nearly the same as not investing at all.

I know this is true, I have seen it happen.

Do NOT buy a share and let it sit! That is as useless as buying seeds to plant in your garden and throwing the seed packet in a desk drawer. It is as useless as pumping gas on the ground instead of in your tank. It is as useless as trying to milk a bull! It is just NORTH OF LUDICROUS!!!!!!!!!!! (insert a screaming Sam Kinison here.)

Now, having said that, investigate the plan parameters for features such as low $ minimums per investment, ACH (Automated Clearing House, a system that uses electronic debit to fund your investment), and allows at least monthly or more frequent investment. If it is quarterly or less, you just have to plan more as you have fewer opportunities to add to your ownership.

This portion of send regular investments is, after obtaining the initial share, the most important component in your ongoing wealth building process. You must believe in your companies to invest when the share price is low, and continue even when the cost is high. You will be buying more shares at lows and fewer shares at highs if you send the same $ amount each time. This is called dollar cost averaging, and if you don't know what that is, in theory it mitigates the risk of investing at the absolute worse time at the all time high. If you need the full definition do a search on this site at the top of the page or go here...

Or here for all results...

With the last heave of the hammer, I put it to you that ongoing OCPs are the lifeblood of your future fortune.

Of course, that is my opinion.

Some of your results will depend on choosing the proper investment that suits your goal that you can live with and sleep at night knowing you own it.

If you haven't read the DRiP archives here and the writings of the moneypaper staff, you could do yourself a favor and do that right away.

I will be away from the PC tomorrow doing the Father's Day events at my folk's place. If you need further assistance, I will be online sometime after tomorrow, but there are several regulars here that can fill in on any other queries you may have. Go ahead and ask. They seem to enjoy clarifying these kinds of things and they are pretty good at it.

Lastly, I have answered a similar inquiry at this link...

...this may provide additional information or answers.


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