Procter & Gamble DRIP Program Updates

Last December I bought some P&G shares through their direct stock purchase program as part of my income-generating portfolio. After comparing what the company charges for direct investment against commissions at ShareBuilder, I decided to go with the company instead of using ShareBuilder. Though the cost of each trade is quite low when buying a small amount, there are still some fees that I consider excessive. For example, there’s a $1 per share charge for additional investments on top of the $0.02 per share commission. This essentially prevents investors from making large investments as the fee could be tremendous.

Last Friday, I received an email from P&G about changes in their Shareholder Investment Program (SIP), which include:

• Enrollment Fee - None (used to be $7.50);
• Dividend Reinvestment Fee - None;
• Optional Cash Investment Fee (via Direct Debit) - None (used to be $1 per share plus $0.02 per share commission);
• Maximum Optional Cash Investment - $6,000,000 (one time and annual);
• Minimum Initial Investment - $250;
• Minimum Optional Cash Investment - $50;
• Sales Fee - $15.00 ($7.50 if requested online), plus $0.12 per share (used to be $10 stock sales fee plus $0.02 per share commission).

For DRIP investors, the removal of enrollment fee and investment fee is definitely a good news.

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