It is actually for my nephew he is 5 yrs old. Also what is the best way to purchase one share and then have that share enrolled in the drip plan? Thanks much,Nick
Nick,I buy my first shares from www.directinvesting.com. If you click on "Drip Enrollment" on the side bar on the left and then click "About Temper" at the top of the page there is a link called "Kids." There are suggestions there. They take care of the enrollment stuff for you, so I definitely like that. It's one less thing to worry about. I'm considering possibly JNJ or HAS for my kids for Christmas. JNJ is the better company. HAS sells toys. Both are fee free. It's going to come down to whether I can afford a share of JNJ for each of them. Another I'm considering is WWY. They're a bit more expensive than JNJ, though. I plan on buying all 3 for myself this year. The first DRiP I bought was SHW. Since you're looking for a boy, that might be good. I am very pleased with the company. When I did my initial research they really stood out as a good company. I only planned to buy a couple. That was in March. I just bought my 6th company last week. There are at least 5 or 6 more I will definitely pick up this year. It's addicting. Rebeccasuper-newbie to DRiPing, so remember what you paid for my 2 cents.
Nick,As Rebecca said, Temper is a good service, which indeed is the best way to buy a single share. However, many stocks allow you to "buy-in" for a certain amount - usually around $250. These can be found at www.equiserve.com or other transfer agents. Also, many companies will allow you to invest directly from them (Duke, Procter & Gamble).My first DRIP was Duke Energy. I still have around 121 shares with them. They are a great company with a decent div'd. From my limited experience -- energy (power & oil/gas), financials, REITs tend to pay the best dividends. Again, that is from my limited experience.The site that Rebecca pointed to www.directinvesting.com is probably the best listing of all stocks that do DRIP plans. The site will tell you what fees are associated with the plan. Who the transfer agent is. And what the criteria for participation is.Good luck to you and your nephew- Major
Rebecca: I enjoy your posts/enthusiasm!Question! "I just bought my 6th company last week. There are at least 5 or 6 more I will definitely pick up this year." OK, OK, now the question. Rebecca when do you stop buying your "first shares" and start accumilating shares of companies already owned?Many things cause difference of investing styles,ie age,income etc. but at some point you have to start building a position in your DRIP's. Just curious as to your plan. (:>) My idea was to build a large position in 5 companies(happen to be EMR,GPC,JNJ,WRE,WMT)use these Quartly dividends as trip money etc.after retirement. As life changes so does our retirement plans/goals. I will not have the large positions I planned as I decided that I will be able to live on my retirement, so I would stop working two jobs! Well there goes my investment money. Oh well! I want to do more living now vs when I retire.I also plan on rolling over WMT to probably a utility, but that will happen this fall, I would like to see WMT move up a little more. .02cents WaivedLa vita 'e bellaGramps
Gramps,I just turned 30 and my husband is 31. We have time. My plan is to spend a year buying first shares. I subscribed to Moneypaper for the reduced fees and the $10 specials. For that reason, it's most cost effective to accumulate for a year.I will not be able to contribute the minimums to all of my DRiPs every month, at least not for the first few years. I will just have to send the money I do have to the companies that make the most sense each month. I'll send more to the most attractively priced and nothing to those that are not as well discounted. Eventually we'll be able to contribute more each month, of course. I will certainly be diversified! :) Mostly, though, I'm enjoying the process of choosing which DRiPs to invest in. Maybe I'm just easily amused. But at least my 'hobby' is going to make me richer, not poorer. Ultimately, I'd like Jeff to be able to take early retirement if it is offered at any point in his late 50's early 60's. He has a federal job. He may have to pick up something part time, but if he can retire early with benefits and work part time for a few years that will be pretty cool. I don't have a job, but I imagine I will at some point. Hopefully we'll mostly use my money to increase our savings. (I admit there are some things I'd buy if we had a second income, too.) I have no idea at this point how I will allocate various forms of retirement income, but I'm sure the quarterly dividends will be a nice chunk of change by that point. Maybe then I'll even sell a few holdings and invest in the others so that there's less paperwork to deal with. Who knows?Rebecca
Rebecca,When I did my initial research they really stood out as a good company. I only planned to buy a couple. That was in March. I just bought my 6th company last week. There are at least 5 or 6 more I will definitely pick up this year. It's addicting.Remember, I warned you. (vbg)Ginny
It is addicting.I started in college with just 3 - Duke, Mobil, and PG. Took a few years off, sold some when money was tight. Now I think I am heading into the land of 9 DRIPS, plus 2 auto-invest mutual funds. The spouse calls it a mental illness.- Major
I want to thank all of you for responding. Thanks for the much valued information. I will do my due diligence....Thanks all Nick
It is addicting.Sure is but its a lot better than being addicted to drugs, alcohol, cigarettes, ect. At least this way you will end up with more money for later.I'd call it a healthy addiction unless you are borrowing from your credit cards or something like that to buy.Ginny
I started with three in college (Pfizer, Coca-Cola and, yes, Enron) and after stopping one (guess which!) I started Intel and Johnson & Johnson. So I'm up to four, with no plans of adding more anytime soon, not only because of cash flow (money? What's that?!?) but also because I'm very comfortable with these four and see no need to add any more in the immediate future, if ever. I don't want to create my own mutual fund, spreading out too far and reducing risk at the price of reducing returns. I may change an investment or two in the future, but I don't see myself having anywhere near ten DRiPs at any time, that just seems like too many to me.Mike
but I don't see myself having anywhere near ten DRiPs at any time, that just seems like too many to me.------------Mike,You make some good points. I'm a master at indecision, though. (Even going so far as to declare indecision my major!) I'm sure that's part of why I'm going to end up with 10 to 15 when I'm done buying my first shares this year. There are so many really good companies. One of my strategies with my DRiPs is to look at companies that I am familiar with or whose products I am familiar with. I don't use just 4 different products, so it's hard to pick just 4 different companies. From there I narrow things down. I don't want to pay fees, so those companies get crossed off the list. I don't use the products from all of the companies on my list of stocks to DRiP, though. SHW was my first DRiP, even though I swear by Walmart paint. I don't use as much AVP as I used to, but my mom is an Avon junkie. AFL is a stock that came across my radar at some point and when it was the $10 special at the beginning of this month I picked up a share. CL wasn't on my original list because I was trying to narrow down my choices, but I also picked that up for a $10 special. Conversely, I use PG products but won't buy the stock because of fees. Having bought CL, my buying habits may change slightly as well. I bought LTD because I like their clothes and I thought owning the stock would add extra motivation to lose weight so I can shop there. (I also spend some money at their other stores.) I want WWY because I chew gum. A lot. Is there even any gum that is made by anyone else? None that I've chewed! To further diversify, I also have a ROTH IRA. (Actually 2... one is mine and one is my husband's, but I make the decisions with the money.) The companies I buy with the ROTH money tend to be smaller companies (with a few exceptions) than the ones I buy with my DRiP money. A quick glance at my ROTH would reveal that I am not terribly diversified... But when you look at both ROTH's and the DRiPs together then the picture is much more balanced.Rebecca
It's just a personal preference. Four just seems to be my magic number. Any more and I feel a bit too spread out, a bit too overdiversified at this point. If I suddenly came into a huge inheritance I would probably add one or two more, but not any more. I like to follow my companies closely, so adding more starts to become a burden. That, and diversifying for diversity's sake doesn't seem to be worth it, I'd just end up diluting my returns instead of protecting against loss. But that's just my style. Everyone has to come up with what is comforatable to them. Some people have to have lots of options, others want to keep it simple. I'm a keep it simple kind of guy. Four DRiPs and a retirement account (403(b), only one fund) does it for me. I'm sure that would drive some people crazy, too much risk! To each their own.Mike
Conversely, I use PG products but won't buy the stock because of fees. Rebecca,One way to get around the fees are to purchase the stock through Sharebuilder. Their basic plan purchases stock every Tuesday for $4/trade. Dividends are reinvested for free. That is how I handle certain companies, like F or MRK, with higher fees.Minxie
I should point out that I save up a bit before I buy each lot. I try to buy at least $200 worth at a time (expenses and all below 2%, you know). If you intend to purchase six different stocks each month, it would probably be worthwhile to sign up for their standard plan. It costs $12/mth, but you get six commission-free trades so each trade really only costs you $2. Again, dividends are reinvested for free.Minxie
Their basic plan purchases stock every Tuesday for $4/trade.But PG charges a fee of $2.50 (plus 3cents/sh), which is lower.
But PG charges a fee of $2.50 (plus 3cents/sh), which is lower.It doesn't work for everything, that's for sure. It has several advantages and if you see my post above, you'll see that you can use the standard plan at Sharebuilder to reduce costs. I only suggest this method for stocks with higher fees. For stocks with lower or no fees, I would suggest using the company's own plan. Some companies also have a minimum that you must buy with them to enroll in the plan or you have to purchase one share elsewhere which has its own fees, in addition to the plan fees. Take Ford (F) as an example. You either must invest $1000 directly or have at least one share of F already to enroll in the plan. In order to buy one share of F through moneypaper, there is a $50 fee plus a $0.50 commission. Add to this an investment fee of $1 for automatic investments or $5 for OCP, according to computershare, and a dividend reinvestment fee of "5% of amount reinvested, not to exceed $5.00 plus applicable brokerage commissions".For someone who is not investing a lot of money into F, it is better IMHO to use Sharebuilder. They reinvest the dividends for free, there is not set-up fee (because it is not in the company DRIP) and if using the standard plan, commissions are held to $2 per investment, whether automatic or OCP. It would take quite a long while for the company DRIP to outpace SB on this once you calculate in the $50 1st share fee, the $1 or $5 investment fee, and the dividend reinvestment fee.OTOH, I invest directly into KO even though I had to buy the first share because the only fee they have is the automatic investment fee of $1, according to computershare.Minxie
You are buying a stock for a 5 year old. Disney would be my choice, with Disney being my second choice etc.The child will be interested and you can explain for years the various companies and not bore the child, ABC, Radio Disney, The resorts, movie studio, Plus it's not a bad long term play. INterest the child in investing it will be a gift as or more valuable than the stock.
The only problem with Disney is that its DRIP charges $5 on OCPs, which is a bit much unless you are investing hundreds of dollars at a time. If a person were investing $50, that would be a 10% fee...:(
I currently am in 2 drips, KO and a Canadian REIT called RioCan (ticker is REI-UN.TO on Yahoo!). The yield on RioCan is around 7%, and recently I went looking for a higher yield dividend. I stumbled upon two American REITs that seem too pay very high dividends. Only the one offers a DRIP. The ticker is RWT, seems to me to be a good company, and it will probably be my newest DRIP soon :)
Nick,It is actually for my nephew he is 5 yrs oldAt that age you want to keep him interested I would buy him one share of WWY. I would probably use the www.giftsofstock.com from moneypaper which will get him enrolled. Its probably not the cheapest but its the easiest. Every year at Christmas time WWY (Wrigleys) will send him a box of gum. with 20 packs in it. Last year it was Juicy Fruit.Just one thought.Ginny
Ginny, Thanks for the insight on Wrigleys sending gum at Christmastime. I was just looking this weekend at buying stocks for my friends 2 young kids(6&8) for Christmas. The two I had narrowed it down to was Hasbro Inc (HAS) for one and Wrigleys for the other. This solidifies that choice. I was going to give some wrigley gum along with the Wrigley stock notice and a Hasbro toy with the Hasbro notice.
I have enjoyed this thread and felt it time to invest my 2 cents. Though I am new to investing, I love to do reserch. I have been "DRIPping" in UFCS for a few months of late. I have a 401k plan from when I was in law enforcement, a ROTH which I max out each year and now I, don't tell the better half this, contribute almost $500 a month into UFCS. Looking at it's history and the direction it's going, besides being reccomended by one of the newsletters here, (I'm not sure I can say which one) it has paid a constand dividend and continued to grow. Again, don't tell the wife, our plan was to pay the house off early, but I think by putting the "Extra" money here, and a few other DRIP's I will starting in the next few months will be more than rewarding. I can't see paying down a house with a fixed 30 year loan at 5% when I can almost get that return from dividends, plus capital growth. The plan is to pay off the house in 10 years and have money left over. Again, please don't tell the boss lady. LOLTim
Again, don't tell the wife, our plan was to pay the house off early, but I think by putting the "Extra" money here, and a few other DRIP's I will starting in the next few months will be more than rewarding. I can't see paying down a house with a fixed 30 year loan at 5% when I can almost get that return from dividends, plus capital growth. The plan is to pay off the house in 10 years and have money left over. Again, please don't tell the boss lady. LOLTim,Almost only counts in horseshoes and hand grenades (also nukes). Don't disrespect a sure thing. Paying off the house early is a sure thing. Here's another sure thing:Your stocks are not going to do what you expect them to do. You HAVE paid off ALL your credit card debt haven't you? If not that should be priority number ONE! Then pay off the house. Then pay your money and take your chances with the stock market.PSIf you and your wife have an agreement you should stick to it.
...don't tell the better half this......Again, don't tell the wife......Again, please don't tell the boss lady...notwithstanding which would be the better investment (house or DRIP) i, for one can't support your (or anyone else) not sharing financial and invesment decisions with your spouse. even if only one of u does the investment due diligence, both should remain aware of where the money is going - and concur generally in such decisions.
both should remain aware of where the money is going - and concur generally in such decisions. ___________ Couldn't agree more that both need to know. Perhaps agreement can not be reached, but spiritting away a part of the money without the other half's knowledge might not lead to a happy ending - neither I nor my decidedly better half would be all that pleased to find this was happening - no matter what the cause. There'd be some real 'splaning to do, no matter how good the cause unless the money was from the 'private' flex money we each allow ourselves from the communal pot - and that usually ain't more than an 'additional' contribution to a drip or 2 per month(if I scrimp).
MY MISTAKE. I meant the post to be more funny than factual. I tried to play my "Better Half" as a monster who also doesn't know what I'm doing. She does TRUST me with finances as I love to research and read and to be honest, have helped make quite a nest egg for the two of US when we retire. Being a teacher and she a counselor, we have good pensions and also try to save almost 20% of gross income for retirement, this is just one avenue we (I) have ventured into. In rereading my post, I see where I misled you and I apoligize as I value your opinions, and your ideas.Tim
MY MISTAKE. I meant the post to be more funny than factual. In that case sorry to be so dour! It sounded like scary territory and your intentions seemed pure so... Anyway good luck
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