While it is nice that there is
free dividend reinvestment with Vanguard, it is still somewhat distressing to pay all the other fees, especially for beginners.
Not exact matches
I have thought about getting an account at Zecco when first learned they offer
free dividend reinvestment, but decided later to wait a while to see things work out
with them.
Think of it like this: If you have $ 30,000 in a tax -
free account
with dividends reinvested, you can put yourself in the position to have 8.5 % annual growth plus 1.5 % returns coming from
dividend reinvestment, so you could realistically compound your money at 10 % annually over that time frame, due to the nature of high - quality cash generating businesses mixed
with long periods of time and tax - favored holding structures.
Now lets see what our various portfolio metrics look like comparing the «
free shares» and «purchased shares»
dividend reinvestment accounting methods over a 20 year time period, starting
with the metrics that differ dramatically.