Compare ways to get enrolled in a DRIP

Direct Enrollment vs. Shareholder Enrollment

Some people believe that companies that allow direct enrollment (DE) through the transfer agent are preferable to those that require shareholder status to enroll in their DRIPs (shareholder enrollment [SE] companies).

We disagree for several reasons.

DE companies usually charge fees whereas SE companies usually do not charge fees:

The transfer agents for the DE companies often levy a transaction fee for each and every subsequent investment into your account.

However, the companies that resist the transfer agent’s fee-based plan often allow you to invest without fees.

To see the effect of fees, click here.

DIRECTinvesting Offers One-Stop Shopping:

You can order one share (or as many as 100 shares) on DIRECTinvesting.com. The DRIP-specific enrollment service will do all the work to get an account open for you in every company you order.

On the other hand, to enroll directly through the transfer agent, you’d have to deal with the agent for each company individually. That could take a lot of time and frustration. In addition, you would be required to make an investment of a dollar amount that is most likely to be more than the cost of the one share that would qualify you as a shareholder—often $250, $500, or $1,000 per company!

Compare the ongoing costs of DE companies with those of SE companies:

Shareholder Enrollment companies

Direct Enrollment companies