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Strategies & Market Trends : Value Investing
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To: Paul Senior who wrote (24448)7/27/2006 12:28:34 AM
From: B.K.Myers  Read Replies (1) of 78802
 
Paul,

I started my serious long term investing by utilizing DRIPs (Dividend Re-Investment Programs). The first DRIP that I invested in was my electric company, Dominion Resources. I started by sending them $50 / month for one full year, which they kept in a money market/savings account. After one year that money was used to fund the original investment in their Dividend Re-Investment Program. Over the course of the next few years I would send them additional money whenever I had the funds and the stock was temporarily beaten down.

I have since then started two other DRIPS, in Johnson Controls (JCI) and PepsiCo (PEP). Whenever one of them is beaten down I invest additional funds. (NOTE to self - looks like a good time to send JCI a few more dollars).

Usually the companies that have Dividend Re-Investment Programs are secure well-established companies with a long history solid performance. Look at a 10-year charter of JCI to see how an established company can grow over the years.

I'm not sure what to tell her to do with her company IRA, but I agree that keeping those funds in a savings account is not a good option. Most companies that offer IRAs usually have a financial advisor to help their employees choose what investment options to select. She should talk with her company's financial advisor. If her company doesn’t have someone she can talk, most banks have qualified financial advisors.

Whatever she does, she should speak with someone who can take the time to understand her current situation and tolerance for risk and help setup a plan for her financial future. The longer she puts off establishing a plan for her retirement, the fewer options she will have.

Hope that this has been helpful.

B.K.
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