Firstrade - Best Broker For DRIPs
Firstrade provides investors with an easy-to-use Dividend Reinvestment Plan (DRIP). This plan lets investors automatically use cash dividends to buy extra shares of the stocks or ETFs that pay them. Investors can enroll individual stocks or their whole account without paying any enrollment fees. Additionally, Firstrade does not charge commissions when buying extra shares through dividends.
To qualify for Firstrade’s DRIP, a stock or ETF must have a price of at least $4.00 and be eligible for margin trading (meaning it can be used as collateral for loans). Not all securities meet these conditions. For example, new IPOs and Bulletin Board stocks aren't considered marginable under U.S. regulations.
Some international stocks are eligible for Firstrade’s DRIP. To receive shares instead of cash dividends from foreign stocks, investors must buy and settle the trade by the dividend record date.
Due to its excellent DRIP options and commission-free investing on most products, Firstrade has been named the
Best Broker for Dividend Investing in 2025.
Fractional shares: Yes.
Review: Firstrade Review
Promotion: 3% match on contributions and 2% on transfers with a No-Fee IRA.
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M1 Finance - Best Broker For DRIPs
M1 Finance has a special version of dividend reinvestment called auto-invest. When the available cash in an account hits $10, M1 Finance automatically invests the money into Pies.
A Pie is simply a group of investments that may include stocks, ETFs, or both. M1 Finance offers preset Pies, or investors can make their own. Cash invested into a Pie, either from dividends or deposits, is divided according to specified percentages.
For example, suppose a Pie has 20% ExxonMobil, 50% in an S&P 500 ETF, and 30% in Facebook. When $100 is invested, it splits like this: $20 in ExxonMobil, $50 in the S&P 500 ETF, and $30 in Facebook.
A key benefit of M1 Finance is that their Pies allow fractional shares, meaning investors can invest precise dollar amounts in stocks or ETFs.
Because of its auto-invest tool and commission-free investments, M1 Finance is named the Top Broker for Dividend Reinvestment Plans in 2025.
Fractional shares: Yes.
Review: M1 Finance Review
Charles Schwab Dividend Reinvestment Plan
Charles Schwab offers its investors a Dividend Reinvestment Plan (DRIP). This allows dividends from stocks or mutual funds to be automatically reinvested into those same investments instead of being paid as cash. Schwab’s website includes a dedicated page for DRIP information. Just enter "dividend reinvestment" into the search box at the top right, or go to the "Products" menu, click on "Stocks," and find the "Dividend Reinvestment" page on the left side.
Schwab’s DRIP includes ETFs as well. It also lets mutual fund dividends and distributions be reinvested back into the mutual fund, rather than deposited as cash.
Fractional shares: Yes.
Review: Charles Schwab Review
Promotion: Satisfaction guarantee and $0-fee trades at Charles Schwab.
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E*Trade Dividend Reinvestment Plan
E*Trade provides investors a Dividend Reinvestment Plan (DRIP) with some limitations. For a stock to qualify, it must trade at or above $5, be held in an E*Trade account, and pay dividends.
To enroll in E*Trade’s DRIP, investors must submit a form. This form can be downloaded as a PDF or filled out online. You can find the form at us.etrade.com/forms-applications without logging in, or by logging into your account, clicking 'Account,' then 'Documents,' then 'Deposits and Withdrawals,' and finally selecting 'More.' The same form lets you both enroll and unenroll. It’s available online and in print. E*Trade typically processes the request within five business days.
Fractional shares: Yes.
Review: E*Trade Review
Merrill Edge/Lynch DRIP
Merrill Edge allows investors to decide whether to reinvest dividends and capital gains, or receive cash instead, for stocks and ETFs. For mutual funds, investors can choose to reinvest both dividends and capital gains, capital gains only, or receive everything in cash.
To enroll, investors should contact a Merrill Edge Investment Center representative.
Fractional shares: Yes.
Review: Merrill Edge Review
Updated on 4/10/2025.