Comments on: Zecco Dividend Reinvestment: More of a Hassle than Convenience

By: S&P 500 High Dividend Paying Stocks

S&P 500 High Dividend Paying Stocks — Wed, 14 Jan 2009 14:59:04 +0000

[...] you can either use cheap brokers such Zecco (10 zero commision trades per month) , which does offer free dividend reinvestment, or buy them through a DRIP [...]

By: Weekend Links - Martin Luther King Day Edition

Weekend Links - Martin Luther King Day Edition — Mon, 21 Jan 2008 23:48:56 +0000

[...] The Sun’s Financial Diary found that Zecco has a horrible dividend reinvestment process. [...]

By: Jo

Jo — Mon, 21 Jan 2008 22:35:15 +0000

I don’t understand why the average Joe would want dividend reinvestment in a taxable account! Each tiny purchase results in a small batch of shares with a new cost basis that has to be managed separately from the rest of your shares. When you sell stock/ETFs, you have to report to the IRS each cost basis with its associated profit or loss. What a pain!

Unless you’re a tax professional or LOVE maintaining huge volumes of detailed financial records, you should just direct the dividends to a bank account and then invest in bigger chunks when you’re ready. This is also very useful for rebalancing.

Do some research – you may soon understand and appreciate why Zecco makes dividend reinvestment hard.

By: Andrew

Andrew — Fri, 18 Jan 2008 17:50:10 +0000

I had the same issue with Zecco – I was told dividend reinvestment could be done but no one I spoke with there knew exactly how I could set it up (this was a couple months ago). Looks like I could try to set it up again, but without fractional shares you either have to have a significant number of shares or else hope they pay one heck of a dividend.