Dividend reinvestment plans at the best online brokerage companies: Fidelity, TD Ameritrade, Ally Invest, Merrill Edge, Etrade, Charles Schwab, Firstrade, Vanguard and others.

Firstrade - Best Broker For DRIPs

Firstrade rating

Investors at Firstrade have access to a free Dividend Reinvestment Plan (DRIP) that will convert cash distributions into additional shares of the securities that pay them. One stock or ETF can be enrolled, or an entire account. There is no charge to sign up, and even better, the broker-dealer does not charge any commissions when additional shares are purchased with dividends.

A stock or ETF must have a market price of $4.00 or higher to be eligible for Firstrade’s DRIP. The security must also be marginable. This means it must be eligible to be borrowed. Not all securities are marginable. For example, recent IPO’s and Bulletin Board stocks aren’t marginable under U.S. securities regulations.

Some foreign stocks are eligible for Firstrade’s DRIP. In order to receive shares of the security instead of cash, the equity must be purchased and the trade settled by the record date of the dividend.

Because of good DRIP policy and $0-commissions on almost all investment products, Firstrade is rated the Best Broker For Dividend Reinvestment Plan in 2022.

Fractional shares: Yes.

Review: Firstrade Review

Promotion: 2 free stocks & $0 fees on all mutual fund, stock, ETF, & option trades.

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M1 Finance - Best Broker For DRIPs

4.5-star brokerage firm rating

Instead of a Dividend Reinvestment Plan, M1 Finance offers something called auto-invest. With this system, once an account’s cash balance reaches $10, the free cash balance is automatically invested in Pies.

M1 Finance DRIP

A Pie is a basket of investments, either stocks or ETF’s or a combination. M1 creates its own Pies, and customers of the broker can create their own. When cash is invested in a Pie, either from a dividend or a deposit, the funds are allocated to target percentages.

For example, say a Pie had 20% invested in ExxonMobil, 50% in an S&P 500 ETF, and the last 30% invested in Facebook. A $100 cash deposit would be invested at those ratios—$20 in XOM, $50 in SPY, and $30 in FB.

Because M1’s Pies invest in fractional shares of securities, it’s possible to invest whole-dollar amounts in stocks and funds.

Because of good DRIP policy and $0-commissions on almost all investment products, M1 Finance is rated the Best Broker For Dividend Reinvestment Plan in 2022.

Fractional shares: Yes.

Review: M1 Finance Review

Promotion: Get up to $250 for making a deposit or up to $2,500 when you transfer an account with $10K+.

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TD Ameritrade Dividend Reinvestment Program

4.5-star brokerage firm rating

Investors at TD Ameritrade can sign up for the broker’s Dividend Reinvestment Plan, also known as DRIP. There is no charge for this service, and it can be used for stocks, exchange-traded funds, and many American Depository Receipts (ADR’s).

To sign up for the broker’s DRIP service, click on ‘My Account’ at the top of the TD Ameritrade website. In the drop-down menu that appears, select ‘Dividend Reinvestment.’ Here, you will find helpful information on reinvesting cash dividends.

Fractional shares: Yes.

Review: TD Ameritrade Review

Promotion: $0 stock/ETF trades and a transfer fee refund.

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Charles Schwab Dividend Reinvestment Plan

Charles Schwab rating

Charles Schwab traders can have stock and mutual fund dividends reinvested into the securities themselves, instead of receiving cash payments. A helpful page on the broker’s DRIP service is available on the website. It can be located by typing in “dividend reinvestment” in the search field that appears in the upper-right of the site. The page can also be found by selecting “Products” in the top menu, and then choosing “Stocks”. A page entitled “Dividend Reinvestment” will then appear in the left-hand column.

This area describes the broker’s dividend reinvestment plan, or DRIP. The broker does offer the service for ETF’s too. And of course, distributions from mutual funds can be rolled back into the fund as shares, instead of deposited into the account’s core position as cash.

Fractional shares: Yes.

Review: Charles Schwab Review

E*Trade Dividend Reinvestment Plan

Etrade brokerage firm rating

E*Trade’s DRIP service has a few policies. First, a security must have a market price of $5 or higher to be enrolled. Of course, the stock or ETF must be in an E*Trade brokerage account, and it must also be currently paying a dividend.

To enroll an equity in the broker’s DRIP service, you must submit a form. This can be downloaded as a pdf document; alternatively, E*Trade offers it as an on-line form. To locate it, you can go to us.etrade.com/forms-applications without logging in. If you’re logged in, just point your browser to ‘Account’ and then select ‘Documents.’ Next, scroll down to ‘Deposits and Withdrawals’ and choose ‘More.’ Finally, there will be a DRIP enrollment form, which will also allow you to unenroll if you wish. The form is available in both hard-copy and electronic forms. It takes the broker up to five business days to complete an enrollment.

Fractional shares: Yes.

Review: E*Trade Review

Fidelity Investing DRIP

Fidelity Investments rating

Fidelity offers dividend reinvestment plans for both securities (stocks and ETFs) and mutual funds. At the broker approximately 6,000 securities are eligible for DRIPs.

Mutual fund dividends default setting is to reinvest unless a customer changes it. Stock dividends are set by default to pay into customer cash.

Fractional shares: Yes.

Review: Fidelity Review

Merrill Edge/Lynch DRIP

3.5-star brokerage firm rating

For stocks and ETFs, investors can reinvest dividends and capital gains or receive cash. For mutual funds, investors can reinvest dividends and capital gains or reinvest capital gains only. Or, investors can elect to receive cash payments.

To enroll, contact a Merrill Edge Investment Center representative.

Fractional shares: Yes.

Review: Merrill Edge Review

Ally Invest Dividend Reinvestment Plan

Ally Invest rating

All marginable U.S. equities and selected American Depository Receipts (ADR's) priced at $4 or more that trade either on an exchange or quotes on NASDAQ are eligible for DRIP. Dividends are reinvested on your behalf on the dividend payable date by our clearing firm. The reinvested position will reflect in whole and fractional shares.

Customers can enroll in Ally Invest dividend reinvestment plan via email or by phone.

Fractional shares: Yes.

Review: Ally Invest Review

Promotion: Up to $3,000 cash bonus + $0 trades + transfer fee rebate.

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T. Rowe Price Dividend Reinvestment Plan

3-star brokerage firm rating

Most securities listed on the New York Stock Exchange or the American Stock Exchange or traded on the National Association of Securities Dealers Automated Quotation (NASDAQ) system are eligible for the Dividend Reinvestment Service. Non-listed foreign securities, nonpublicly traded limited partnerships, preferred issues, and short positions are not eligible.

Enrollment in Dividend Reinvestment Service becomes effective on the first business day after an investor elects to enroll and the broker receives account application.

Fractional shares: Yes.

Reviews: T.Rowe Price Review

Vanguard Dividend Reinvestment Program

Vanguard brokerage company rating

All eligible stocks, closed-end mutual funds, exchange-traded funds (ETFs), FundAccess® funds, or Vanguard mutual funds are eligible for Vanguard Dividend Reinvestment Program.

Enrollment in the Dividend Reinvestment Program can be done by phone or by accessing an account on vanguard.com.

Fractional shares: Yes.

Review: Vanguard Review