Welcome to our little cubbyhole of Fooldom, where being a Dripper is a good thing (that requires no medical attention) and thousands have learned how to build wealth slowly. If you've been looking for a way to get into the market but have only small amounts to invest, this is the place for you. And even if you have more dough than donut shop, direct investing can still play an important role in your overall financial picture.
Since new readers drop by here every week, I thought I'd take the opportunity to pull together some of the many resources out there so they're available to us in one, handy place. So whether you're new to Dripping or a seasoned veteran who needs a new page to bookmark, read on!
Your Drip headquarters
I'll admit I'm a little biased, but I think the first stop for anyone interested in learning more is right here. The Drip Port is a real-money portfolio created by our own Jeff Fischer (author of Investing Without a Silver Spoon, a 437-page guide devoted to Dripping) back in 1997.
Looking back on it all, the timing has been incredible. It reminds me of the Continental Divide, which is the imaginary line running through the highest points of land along the range of the Rocky Mountains. Rainwater falling on the west side of the divide finds its way to the Pacific Ocean; drops falling on the east side drain to the Atlantic Ocean or the Gulf of Mexico. (Here's some trivia for you: Every continent has a continental divide, except Antarctica. I must admit I don't know why it doesn't have one. That makes no sense to me, and I'm sure the Antarctica tourist bureau is quite bitter about it.)
Our own Drip Port sits neatly on Wall Street's version of the Continental Divide, which is the early part of the year 2000. That marked the end of the greatest bull market in history and the start of one of the meanest bear markets ever. The port's history falls pretty much equally on either side of that great divide.
Why is this relevant? Because it provided Jeff and everyone involved -- including all of our loyal readers -- with a valuable learning experience. We've Dripped through good times and bad; we've stuck to the same deliberate, conservative investing philosophy; and we've laid a great foundation for building wealth.
Bookmark it, Dan-O!
We're certainly not the only stop you should make on your Drip journey; there are many great websites out there. One of my favorites is the DRiP Investing Resource Center, run by George L. Smyth. George has written many articles for us, and he's a frequent contributor on our discussion boards as GLSmyth (I'll talk more about the boards later). His site is a nice collection of articles, research, spreadsheets, and other tools.
The Drip Advisor provides some educational information and features an extensive list of stocks with information on fees, the number of shares needed to qualify for Dripping, minimum investments, etc.
Drip Central is another fine site. Not only does it have a collection of articles and tutorials, but its DRIP Web Site Directory is a detailed compilation of other sources (including The Motley Fool). Here you'll also find a complete online mini-book that takes you through the complete direct investing process.
The Moneypaper has dozens of good articles on Dripping, and even has a section dedicated to kids. It also provides an extensive list of companies offering reinvestment programs, as well as a brokerage that helps individuals obtain the initial share (or shares) required for enrollment.
Those needing to buy initial shares of a company should check out First Share. It offers a neat program that refers requests of members wishing to purchase shares to members willing to sell them.
The Clearinghouse is a free service that provides the ability to request enrollment materials from companies and mutual funds that offer direct purchase. It also has a good list of Drip-worthy companies. Finally, on Netstock Direct you can research stocks, view prospectuses, and even enroll in plans online.
There are plenty of alternatives available even if you're interested in companies that don't offer direct investment programs. ShareBuilder.com allows you to invest as often as you like on a weekly or monthly basis, in as many stocks as you like, for $12 a month. If you're not likely to make more than three purchases each month, however, you'll probably want to opt for the second option -- which is $4 per transaction, period. There's no monthly minimum and no annual fee, so you don't pay if you don't play.
FOLIOfn has recently unveiled a new pricing plan that allows $4 buys and sells, also with no minimums. BuyandHold.com is another low-cost broker, but there's no way of getting around a monthly fee, even if you don't trade. For a more detailed evaluation of these companies, see my column on Reevaluating Low-Cost Brokers.
Foolish discussion boards
I've saved one of the best resources for last: our Fool Community. We have two discussion boards dedicated to Drippers, one for discussing companies and the other for the basics. The quality of posters on the boards is outstanding. There seems to be a perfect mix of veterans and novices, and the learning never stops.
There's also a great FAQ posted on the boards that covers all the basic questions, as well as valuation, tax consequences, IRAs, and selling. The boards require a modest fee, but if you're not yet a member, you can try a 30-day free trial.
Yes, I know...
I more than likely missed a few good resources. If so, please share them with the rest of our readers on our Drip Investing - The Basics board!