The Dividend Investing Resource Center

Letting Dividends Do Their Work

Frequently Asked Questions

1. What is a DRIP/SPP?

It's a Dividend ReInvestment Plan with a Share Purchase Plan.

2. How is a DRIP/SPP better than a broker's DRIP?

A broker's DRIP allows you to reinvest dividends in additional shares but does not permit fractional shares. They will also charge you a fee each time you wish to buy more shares.

3. Do I have to send a payment each month to my DRIP?

No, payments are optional. You choose when to make a payment.

4. How do I start a DRIP?

You need to be the registered owner of at least one share first. To get shares, you can buy them through a broker and then get them to transfer them into your name. OR can buy a single share from someone who owns some. OR can join a Group buy.

5. What is the best way to get a share?

The cheapest way (but perhaps slower) is to buy a single from someone. Buying from a broker could be quicker but you have to pay the buy fee plus a transfer fee.

6. How do I know if a company I'm interested in has a DRP and SPP?

There are hundreds of US DRIPs but not so many in Canada.

Most Canadian companies that have DRPs and SPPs are listed here:

A good source of info for Canadians is: http://

7. What is a Group buy?

One person with a broker account buys shares for the group and each person in the group pays his/her share of the costs.

8. What do I do after I get a share in my name?

You need to send in a form to the company's Transfer Agent to request a DRIP account.

9. I posted a request for a share on the share exchange board, but no one has replied. How come it's so hard to find someone to sell a share to me?

Most people who have shares prefer to trade them. Once they have enough DRIPs, they may sell their single share. They could also sell shares from within their DRIP/SPP account.

However, there are more buyers than sellers. You can increase your chances of getting a first share by filing out your profile, and including an email address with your request. Check the share board frequently, as you will have only a very short time to reply to announcements of single shares and group purchases. A guaranteed way to get a first share while keeping costs down is to run your own group purchase.

10. How can I sell my DRIP shares?

Some companies allow the TA to sell them for you but the most common way is to request the shares be sent to you and you then deposit them into your broker account so you can sell them whenever you want.

11. Do I need to keep the single share once my DRIP/SPP is set up?

No, you can use it to trade for a share in another company or you can offer it for sale.

12. How do I transfer a share to someone else?

You need to go to a bank, sign it there, and get the bank to guarantee your signature. Then you mail it to the TA with instructions.

13. What do all those acronyms mean?

DRP = Dividend Reinvestment Plan
SPP = Share Purchase Plan
OCP = Optional Cash Purchase
TA = Transfer Agent
RRSP = Registered Retirement Savings Plan
IRA = Individual Retirement Account
TFSA = Tax Free Savings Account
CS = Computershare, and
CST = Canadian Stock Transfer

14. Where can I find more information about investing and investing terminology?

A good place to start is There are also a number of good books and articles.

15. How do I make option cash payments?

You can download forms from the internet but the TA will mail you regular updated account information. They will also include the form needed for your next payment.

16. Why should I fill out my profile, and how can I do it?

Filling out your profile helps us know who you are. By looking at your profile, a reader can better understand your opinion. It's like introducing yourself to people you meet for the first time at a party - you want them to know who you are.

To fill out your profile, just go to the main Boards page and click on the Profile link. After logging in you can enter information that lets everyone know about yourself. Of course, it is your decision to remain relatively anonymous, or let the world know who you are. The email address you enter in your profile will never be given out and is used if I need to communicate with you.

This website is maintained by George L Smyth