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Setting Up a DRIP for a Stock or ETF at BMO InvestorLine

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Today I decided to start a Dividend Reinvestment Program (DRIP) for a stock I hold in a registered investment account at BMO InvestorLine. Here’s what I had to do.

How to Set Up a Dividend Reinvestment Program (DRIP) at InvestorLine

Have your Account Number and Login Password handy.
I usually login using a Userid that groups all of my accounts at InvestorLine, so I actually had to go looking for this information!

  1. Call 1 888 776 6886.
  2. Select your preferred language from English, French or Chinese.
  3. At the prompt, enter your Account Number followed by the # symbol.
  4. At the prompt, enter your Login Password followed by the # symbol.
  5. Listen to the voice mail menu as it changes from time to time. For my call, I had to press 0 and 3.
  6. Wait on hold. I waited for 5 minutes, which they had warned me was the expected wait time.
    • I was calling mid-morning on a Thursday.
    • The hold music wasn’t as strange as ING Direct’s version of “Money for Nothing.”
    • Instead of selling products to me, the voice-overs offered tips for using InvestorLine to research stocks.
  7. Once the call was answered the assistance was super speedy. In less than one minute, the person
    • Confirmed my account number.
    • Confirmed the number of shares of the stock I hold that I want to enroll in the DRIP.
    • Warned that it usually takes 2 weeks for a DRIP to be created. Any dividends received during that two week period would be paid in cash not DRIPped.
    • Confirmed that the usual dividend payment for my holding was “Y” and that the cost per share is “Z” and therefore that I would receive several shares with each dividend payment and the balance would be paid in cash.
      If the dividend paid by a stock is less than the amount required to buy 1 share, then the entire amount will be paid as cash even if the stock is enrolled in a DRIP.
    • This was a good reminder that InvestorLine offers a synthetic DRIP. You cannot buy fractional shares. All shares must be purchased as whole shares.
  8. Gave me a Reference Number for the request.
  9. Wished me well.

Rating the DRIP Enrollment Process for a Stock Held by BMO InvestorLine

Overall, I would give this system 4.5 out of 5. The customer service was excellent. The wait time could be improved.
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Do you DRIP any stocks or ETFs using BMO InvestorLine? Are you satisfied with their service? Please share your experiences with a comment.

Book Review: I Will Teach You to be Rich by Ramit Sethi

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When I saw this book on the library rack recently, I couldn’t resist the title and checked it out. Personally, I think I’m already rich because I have a great husband, annoying challenging great kids, a home that doesn’t leak since we got the roof fixed, some money in the bank, more great family, friends and, touch wood, reasonably good health. All this and guinea pigs too! How lucky can one person be? Anyway, I thought I’d read it to see if I could be taught to be MORE rich. (Hopefully without having to have more children.)

Here’s the Instructions I Found Inside I Will Teach You To Be Rich

Pay all of your credit card debt first. Get a good card and use it to build your credit rating.

Set up a no-fee no-minimum chequing account with free overdraft protection.

Set up a savings account that offers online access and automatic transfers and payments.

Set up automatic bill payment for everything possible including the credit card. Have the credit card set up to send you an email of the bill a few days before it is automatically paid.

Setup a 401(k) (like a RRSP) at work.
If your employer will match your contributions, contribute to get the money. At a minimum contribute 5% of your pay if they will match it.

Open a Roth IRA (like a TFSA). If you are not contributing anything to your 401(k), contribute 10% of your pay here. If you are contribute (10%-401(k)) here.

Identify what YOU feel is worth spending money on (clothes/shopping; electronics; home décor; going out with friends) and what you feel you don’t need to spend the most on (clothes/shopping; electronics; home décor; going out with friends) Figure out a budget that lets you spend on what you feel is important by cutting on back on what you feel is unimportant. E.g. Spend tons going out and live in a 750-square-foot shared apartment. Spends lots travelling but not on your home or shoes.

Your budget will include four parts: fixed costs, savings, investments and spending money.

Set up and make automatic contributions to savings and investment accounts for

  • your wedding, even if you aren’t dating
  • your house down payment
  • your savings goal (vacation; TV etc.)
  • your investment goals (retirement; etc)

For retirement and long term savings invest in a “Lifecycle” fund that is diversified (US, international equities, US bonds, US cash/money market). If you can’t or won’t then research for low-fee funds to create your own equivalent “Lifecycle” fund.

Major Premises of the Book I Will Teach You To Be RichInclude

  • Too much financial information means people do nothing because they’re confused and afraid.
  • Sethi greatly dislikes the constant financial “noise” on TV and in the media.
  • People 20-30 should invest and should take high risks since they can recover.
  • “Lifecycle” funds are ideal for people who don’t want to manage their investments. They will only get 85% of the win, but that’s worth it to set and forget.
  • Index investing is the only kind that wins over the long term.
  • Invest a minimum of 10% of your pay in a 401(k) and/or Roth IRA (RRSP and TFSA).
  • People only save for a reason. Identify your reason (travel; family; clothes shopping; car; wedding; house down payment) and then work hard to reach that goal.

Tone
The book is written in a fast-paced conversational tone. It’s aimed at readers in their 20s but has advice that could help anyone. It’s written as if he’s talking to a man, which is occasionally mildly annoying if you’re not male. It’s humorous but not funny.

Practical
The book gives specific advice. It tells you what bank account to open and which company’s fund to invest in. It has scripts for negotiating lower fees and interest rates. It breaks the tasks into manageable steps.

Who the Book Won’t Help
This book won’t help someone who is deeply in debt. It only touches lightly on debt management.

Who this Book Should Help
For those with “analysis paralysis” this book should provide a good start to getting their financial life sorted out.

Will You Get Rich Following this Advice?
You will certainly be on the path to financial riches. For sure if you can decide what you want money for (as advised) you will be non-financially rich fairly quickly after implementing the plans in this book. (E.g. less worried; saving for the future; saving for what matters to you; more focused; happier)

What Did I Personally Take Away from the Book?
I’m not the target audience for the book. I did, however, find the chapter on deciding WHY you want money to be thought provoking. My husband and I talked a bit about it, and he went on talk to some work friends about it. I certainly will talk about it with my children in the future. In the book, he includes an example of someone spending $21,000/year going out with friends who has found the way to do that without penalizing their future lifestyle because that spending is planned for, not accidental. (Among other things, that person does not take vacations, has a very small rented home and does not spend much on personal possessions. Read the book for all the details.)

Conclusion
It’s worth reading.

Book Version Kindle Version