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Non-Tech : DRIPs -- Dividend reinvestment plans
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To: Duane Sieren who wrote (80)1/13/1997 12:53:00 AM
From: Rick Kunz   of 263
 
MCD has fees that I think are onerous for our small holding -- under
100 shares -- it's my wife's call on that stock, and they now charge
$3/yr maintenance for the account and a small amount for brokerage.
If it were up to me I think I'd have MCD forward the div checks and
only buy thru them when we (she) wants to invest more than a minimum
amount -- that's if I even chose to keep MCD in today's environment.
Intel and Motorola charge us a few cents for purchase, as do some of
the others we have. My whole strategy in getting involved with DRIPs
in the first place was to avoid brokerage charges. If they charge
$5 per purchase, then in 5 or 6 months you're paying them more than
you'd pay a deep discount broker for the same number of shares, so
it doesn't make sense from my small-potatoes ability to invest.

We have one that used to offer a 5% discount on cash purchases as
well as reinvested dividends -- American Water Works -- but they cut
out the discount last spring for several reasons. I think they still
pay all brokerage for purchases. None of our other utility companies
charge brokerage or maintenance on the buy side. I've never sold
shares thru any DRIP, only had 'em send certificates a couple of times,
but I think most, if not all, charge a little more for sales. We are
trying to keep a long-term perspective and not try to trade in these
accounts. Takes a master's in accounting to track 'em as it is!

Rick
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