If you own shares, I’ll bet you enjoy
receiving regular dividends – I know I
But if you don’t rely on those dividends
for money to live on, one way to get
more value from dividends is with a
dividend reinvestment plan.
Now what’s all this about?
Well, these allow shareholders to reinvest dividends by taking the
payment as additional shares in the company rather than getting
cash in hand.
Dozens of listed companies offer dividend reinvestment plans and
it can mean saving on the brokerage you’d pay if you purchased
the shares on the market. The shares are often offered at a
discount, providing further value.
Some companies, like Woolworths*, do put a limit on the number
of shares you can hold through a dividend reinvestment plan – but
if you’re interested, check out the investor section of the company
website that you hold shares in.
*Woolworths Ltd imposes a maximum investment of 20,000 shares.