Ep 19 - Can you benefit from a DRIP Stock Plan
In this episode I talk about Dividend Reinvestment Plans or DRIP plans and how they can benefit you. We walk through two examples of how you can grow your investment by reinvesting the dividends you get from your stock holdings back into the stock. For illustration purposes we assumed the stock price and the dividend amount stays the same so that we can easily show how the dividend grows your number of shares and in turn more dividend dollars coming your way. We used Verizon and Apple as two stocks that have a different result when it comes to using the DRIP strategy, with Verizon producing a more significant impact that Apple would for this strategy. That doesn't mean that one or the other stock is better or worse, just different depending on whether you want to implement a DRIP strategy.
Here are the numbers:
| Verizon | ||||||
| Price | Shares | Value | Div/Share | Total Div | Additional Shares | |
| $ 38.58 | 100 | $ 3,858 | 0.65 | 65 | 1.68 | 2-Feb |
| $ 38.58 | 101.68 | $ 3,923 | 0.65 | 66.09513 | 1.71 | 2-May |
| $ 38.58 | 103.40 | $ 3,989 | 0.65 | 67.2087 | 1.74 | 2-Aug |
| $ 38.58 | 105.14 | $ 4,056 | 0.65 | 68.34104 | 1.77 | 2-Nov |
| $ 38.58 | 106.91 | $ 4,125 | 0.65 | 69.49246 | 1.80 | 2-Feb |
| $ 38.58 | 108.71 | $ 4,194 | 0.65 | 70.66328 | 1.83 | 2-May |
| $ 38.58 | 110.54 | $ 4,265 | 0.65 | 71.85382 | 1.86 | 2-Aug |
| $ 38.58 | 112.41 | $ 4,337 | 0.65 | 73.06442 | 1.89 | 2-Nov |
| $ 38.58 | 114.30 | $ 4,410 | 0.65 | 74.29542 | 1.93 | 2-Feb |
| $ 38.58 | 116.23 | $ 4,484 | 0.65 | 75.54716 | 1.96 | 2-May |
| $ 38.58 | 118.18 | $ 4,560 | 0.65 | 76.81998 | 1.99 | 2-Aug |
| $ 38.58 | 120.18 | $ 4,636 | 0.65 | 78.11425 | 2.02 | 2-Nov |
| $ 38.58 | 122.20 | $ 4,714 | 0.65 | 79.43033 | 2.06 | 2-Feb |
| $ 38.58 | 124.26 | $ 4,794 | 0.65 | 80.76858 | 2.09 | 2-May |
| $ 38.58 | 126.35 | $ 4,875 | 0.65 | 82.12938 | 2.13 | 2-Aug |
| $ 38.58 | 128.48 | $ 4,957 | 0.65 | 83.5131 | 2.16 | 2-Nov |
| $ 38.58 | 130.65 | $ 5,040 | 0.65 | 84.92014 | 2.20 | 2-Feb |
| $ 38.58 | 132.85 | $ 5,125 | 0.65 | 86.35089 | 2.24 | 2-May |
| $ 38.58 | 135.09 | $ 5,212 | 0.65 | 87.80574 | 2.28 | 2-Aug |
| $ 38.58 | 137.36 | $ 5,299 | 0.65 | 89.2851 | 2.31 | 2-Nov |
Here is the Apple Numbers:
| Apple | ||||||
| Price | Shares | Value | Div/Share | Total Div | Additional Shares | |
| $ 148.03 | 100 | $ 14,803 | 0.23 | 23 | 0.16 | 2-Feb |
| $ 148.03 | 100.16 | $ 14,826 | 0.23 | 23.03574 | 0.16 | 2-May |
| $ 148.03 | 100.31 | $ 14,849 | 0.23 | 23.07153 | 0.16 | 2-Aug |
| $ 148.03 | 100.47 | $ 14,872 | 0.23 | 23.10737 | 0.16 | 2-Nov |
| $ 148.03 | 100.62 | $ 14,895 | 0.23 | 23.14328 | 0.16 | 2-Feb |
| $ 148.03 | 100.78 | $ 14,918 | 0.23 | 23.17924 | 0.16 | 2-May |
| $ 148.03 | 100.94 | $ 14,942 | 0.23 | 23.21525 | 0.16 | 2-Aug |
| $ 148.03 | 101.09 | $ 14,965 | 0.23 | 23.25132 | 0.16 | 2-Nov |
| $ 148.03 | 101.25 | $ 14,988 | 0.23 | 23.28745 | 0.16 | 2-Feb |
| $ 148.03 | 101.41 | $ 15,011 | 0.23 | 23.32363 | 0.16 | 2-May |
| $ 148.03 | 101.56 | $ 15,035 | 0.23 | 23.35987 | 0.16 | 2-Aug |
| $ 148.03 | 101.72 | $ 15,058 | 0.23 | 23.39616 | 0.16 | 2-Nov |
| $ 148.03 | 101.88 | $ 15,081 | 0.23 | 23.43252 | 0.16 | 2-Feb |
| $ 148.03 | 102.04 | $ 15,105 | 0.23 | 23.46892 | 0.16 | 2-May |
| $ 148.03 | 102.20 | $ 15,128 | 0.23 | 23.50539 | 0.16 | 2-Aug |
| $ 148.03 | 102.36 | $ 15,152 | 0.23 | 23.54191 | 0.16 | 2-Nov |
| $ 148.03 | 102.52 | $ 15,175 | 0.23 | 23.57849 | 0.16 | 2-Feb |
| $ 148.03 | 102.67 | $ 15,199 | 0.23 | 23.61512 | 0.16 | 2-May |
| $ 148.03 | 102.83 | $ 15,223 | 0.23 | 23.65181 | 0.16 | 2-Aug |
| $ 148.03 | 102.99 | $ 15,246 | 0.23 | 23.68856 | 0.16 | 2-Nov |
Disclaimer - These companies are used for example purposes only. Results may vary depending on stock price, dividend changes and market conditions. The Red Barn Financial Podcast is for informational purposes only and should not be considered legal, tax or financial advice.