The Moneypaper and the News Media

The Oregonian--December 10, 2006 Whether you want to give a gift of stock this holiday season or launch a long-term investing plan for yourself, there are several ways to accumulate shares a few at a time… GiftsofStock.com A subsidiary service of The Moneypaper newsletter based in Rye, N.Y., GiftsofStock.com allows you to buy one or more shares of stock and then enrolls you into the company's no-fee dividend reinvestment plan. "It's particularly good for young kids," says Vita Nelson, publisher of the newsletter, allowing for the gradual accumulation of shares without a lot of extra costs. Parents can customize a "stock" certificate at the Web site and download it for something to put under the tree, but the real shares will be held electronically in the company's plan. Among the 50 or so stocks Nelson includes on the suggested gift list at the moment are Hasbro Inc., Avon Products Inc., Fortune Brands (maker of Titleist golf balls and Jim Beam bourbon), 3M Co., and Bank of America Corp. The bookkeeping isn't as hard as you might think, Nelson says. You can use a "portfolio keeper" tool at another Moneypaper Web site, www.directinvesting.com, she says. Or just keep your last dividend reinvestment statement, which summarizes account activity for the full year. When you sell shares, you can refer to the statements for how much extra you invested over the years. Add that to your original investment to get your basis. – Julie Tripp (The Oregonian)

USA Today--August 11, 2006 Some companies, like General Electric (GE), Home Depot (HD) and Procter & Gamble (PG) let investors buy stock directly from them. P&G, for instance, accepts initial investments in its Shareholder Investment Program for as little as $250. Ongoing fees include a one-time $7.50 setup fee, a $1 fee each time you add money to your P&G account from your bank account and a 2-cents-per-share commission. There's also a $10 fee when you sell stock. These fees are fairly reasonable. But as good as these programs are, there are drawbacks. First, to create even a slightly diversified portfolio you'd need accounts with dozens of companies. Managing all those accounts would be problematic. Next, not all stocks you're interested in have direct-purchase programs. Last, all the programs are different, so it's difficult to remember the rules and fees of each. You can see which companies offer these programs at websites like: DirectInvesting.com. – Matt Krantz

The Early Show/CBS--June 20, 2006 Dividend reinvestment plans are a way for people to buy stock directly from the company (usually through a transfer agent) in very small to large amounts, and usually on a monthly basis if desired. These plans get their name from the fact that they also allow shareholders to reinvest the dividends they receive from their shares, using these dividends to purchase more stock. Thus the name "Dividend Reinvestment Plan," or DRIPs. DRIPs are offered by almost 1,000 companies — from AFLAC to Yahoo — and by using DRIPs, you can invest in a stock directly without a broker and often without any additional fees or commissions. And best of all, to start you only need enough money to buy one share of the stock. DRIPs are a way to begin investing with a very small amount of money and to keep investing monthly (or as frequently as you can afford) in small amounts by and reinvesting dividends and making additional contributions, while avoiding brokerage commissions. In the long term, it's a great long-term way to grow money. You have dollar-cost averaging working for you and you're investing, ideally, in great companies that you don't foresee selling for a long time. Of course, one downside of DRIPs is that you may end up investing in the stock of one company, and this can mean more risk than you are willing to take with your precious savings. So it's best to carefully choose the stock or stocks and look for stocks of mature or blue chip companies that pay above-average dividends to shareholders. – Ray Martin (CBS/The Early Show)

Bottom Line Personal--July 15, 2005 Since the first dividend reinvestment plan (DRIP) was introduced in 1969, hundreds of companies have offered investors the option of buying shares directly-and reinvesting dividends into more shares without a broker. Now there's evidence that these plans (also known as direct reinvestment plans and direct stock purchase plans) are a wise way to identify winning stocks and beat the market as well. Since its inception, the MP 63 Index of DRIP stocks, developed by my company, is up by 248%, versus 168% for the S&P 500 Index. That gap would be even wider if you factored in stock transaction fees, which can be avoided with DRIPs. Why should companies that let individuals invest directly outperform the rest of the market? Likely reason: Companies that go out of their way to make buying their shares cheap and convenient also go out of their way to deliver good returns to shareholders. Plus their shares are widely held, and investors tend to buy their products and services. – Vita Nelson, interviewed by Bottom Line Personal.

MarketWatch, PAUL B. FARRELL--April 10, 2005 Don't trust brokers? No confidence in fund managers? Cut out the middleman. Here's how: Buy stocks directly from a company. Become one of America's DRIP investors. Never heard of them? I'm not surprised. Vita Nelson, editor of the Moneypaper newsletter, calls corporate dividend reinvestment programs, or DRIPs, the "best-kept secret on Wall Street." Most people haven't heard about them for one simple reason -- companies can't advertise their DRIPs. Why? Because brokers and fund managers can't sock you with big fees and commissions if you buy stocks directly from a company. So they won't tell you the "best-kept secret" and they've made sure Congress and the SEC keep it a secret too. But I can tell you. DRIPs are a great way to get on the dividend bandwagon. DRIPs are a simple way to invest dollars and reinvest dividends. DRIPs are a great long-term saving plan that can help you build a retirement portfolio of solid blue-chips.

Los Angeles Times--November 28, 2004 "Instead of the cake, give them Sara Lee stock," said Vita Nelson, editor of an investment newsletter called the Moneypaper. "In the future, they can buy as much cake as they want." Aside from imparting knowledge, the gift is also likely to pay even more tangible returns. A $5,000 investment in a Standard & Poors 500 index fund in 1984 would be worth more than $57,000 today. More than 1,000 companies allow investors to buy stock directly from them, often with no trading costs at all, Nelson noted. When those shares pay dividends, the company will automatically reinvest them in company stock, allowing the account to compound. Among the big-name corporations that offer these so-called dividend reinvestment plans are BellSouth Corp. (cellphones), Avon Products Inc. (makeup), General Motors Corp. (autos) and Limited Brands Inc. (apparel), Nelson said. All of these companies make products that can resonate with a teen, she said. To register with many corporate dividend reinvestment plans, the investor must first own at least one share of the company's stock. The Moneypaper offers a stock-giving service that helps investors buy the first share and register with the dividend reinvestment plan. "Maybe, for a little kid, you want to buy a miniature motorcycle to go with the share of Harley-Davidson stock — or give nail polish with Avon shares — so the kids can picture it better," Nelson said. "But if you can inculcate an investing attitude at a young age, you'll find those kids will be able to take care of themselves better in the end. "Starting early is such a wonderful advantage."

The Bull & Bear Financial Report - July 2004 If you sell too soon, you may lose out on immense future gains; sell too late and you might watch your gains evaporate or your losses mount. There are no easy answers, but here are some tips to consider: When a stock moves up to the point where you can sell part of a position to get your money out and still maintain exposure to the stock, sell. Suppose you bought 300 shares of a $20 stock (investing $6,000), which moves up to $60. You might sell 100 shares to get your money back and leave your profits on the table. There are core holdings that you intend to keep forever, growing along with the company. Don't sell them. Investors who hold onto great companies are likely to beat traders over the long term....

PRWeb Newswire - February 14, 2004 The MP 63 Fund (DRIPX) Outperformed Every Fund in its Category... Read more

Nightly Business Report--August 20, 2003 "MILLER: More than a thousand companies offer dividend reinvestment plans, including all 30 Dow companies. Many firms offer the plans to raise capital and help broaden the investor base. " "VITA NELSON, EDITOR, "THE MONEYPAPER": We think that they're extraordinarily good companies, that they're shareholder oriented. And we think that the DRIP itself helps the company's stability in the marketplace because they have so many investors investing regularly. "

Fox News--September 8, 2003 "General Electric (GE) Vita Nelson, president of The Moneypaper: MAKER Well, I can't say I like it now. I've liked it for a long time. We believe in dollar-cost averaging and continually picking up more stock in the same company. We've held it for a long time. All the companies in our MP63 fund have been there since the beginning, its like an index fund." Johnson & Johnson (JNJ) Vita Nelson: MAKER We like these companies for long-term holding. They have brand names like Band-Aid. Everybody knows these companies; everybody uses their products. The most important thing about both companies is that they increase their earnings consistently and consistently increase their dividends." ...Read more

Black Enterprise-- August, 2003 "The process to open an account can take several weeks. You can also access DRIPs at DirectInvesting.com (www .directinvesting.com) by opening an account with the Temper Enrollment Service for $30.50. (Temper's fee is less if you pay a subscription fee of $50 to $199 for additional investment resources on the site.) Temper handles all the paperwork and can open your account in four to six weeks." ...Read more

CNN.com--October 24, 2001 "Answer: In response to your letter, I asked for a comment by Vita Nelson, editor of the Moneypaper newsletter, long-time advocate of dividend reinvestment plans and manager of the MP 63 Fund, which invests in 63 companies that offer such plans." "The writer of the letter is correct, of course, about management that heaps excess rewards upon itself, in effect plundering the corporate treasury, often with the assistance of the board of directors," Nelson said. She also said, "Ultimately investors must vote with their feet and abandon companies that are heading down such a destructive road. But it's also important to avoid lumping greedy management in with companies that pay small dividends, since the connection may only be coincidental." ...Read more

Fool.com--July 19, 2000 "Hearing this, I contacted Temper of the Times. What Temper can do for $20 is purchase our first five shares of Pepsi stock in certificate form (in our name) and have Pepsi's Drip enrollment form sent to us. This way, all that we need to do is sign the form and mail it to the Bank of New York. After that we'll be enrolled. So, Temper will take care of buying the Pepsi shares for us and will send us the plan form to enroll. We take it from there with one easy step -- mail in the enrollment form. And then wait." ...Read more

International Herald Tribune--January 29, 2000 Vita Nelson, an investment adviser who runs The Money Paper and advises on DRIPs, urged investors to stick to companies that require a single share to qualify for direct investing or dividend-reinvestment plans, rather than the $200 or $250 minimum required by many bank-sponsored plans. Mrs. Nelson also keeps a sharp eye on plans that charge what she terms ''excessive fees'' for cash investments, reinvestment of dividends or the sale of shares. After all, if the goal is to build up a position over time in small increments of as little as $50 a month and to reinvest dividends, large fees are counterproductive. DRIPs, she said, should be a ''way to level the playing field between small investors and big institutions."...Read more

International Herald Tribune--July 17, 1999 "Still, as a result of the new rules has been an explosion of companies offering dividend-reinvestment plans, which this week stood at 1,272, according to Vita Nelson, editor and publisher of the Money Paper, another newsletter and one associated with a company that helps investors buy shares in these companies. Investors outside the United States can participate in 986 of those plans, she said, and there are growing numbers of foreign companies whose American depositary receipts offer DRIPs." ...Read more

The Wall Street Journal "...Ms. Nelson is a strong supporter of a DRIP strategy. 'There are still hundreds of DRIPs that are low cost-- enough to build a fabulous diversified portfolio,' she says."

Forbes "Vita Nelson, editor of The Moneypaper, points out an overlooked way to sock away money tax-free for your offspring: put them to work for you."

Physicians Money Digest "The [MP 63] fund is named after Nelson's brainchild, The Moneypaper 63 index, [which] according to Nelson, has out-yielded the Dow by 163% to 149% throughout the past 5 years."

Consumers Digest "The Moneypaper has created a service that holds your hand through the whole [DRIP sign-up] process..."

Barron's "Editor and Publisher Vita Nelson in her November issue... put seven growth companies on her shopping list..."

Business 2.0 "In 1986, Vita Nelson had already been promoting direct investing for a few years, perhaps one of the first attempts at middleman slashing on the financial services space."

Barron's "[For] holiday gift giving... Editor and publisher Vita Nelson suggests a share of stock in a company that permits direct investment."

Every month, thousands of readers across the United States rely on The Moneypaper and Direct Investing for timely advice to help them plan their financial future. And every month, the media--magazines, newspapers, television, radio--request our opinion and ask us for facts to assist them in their coverage of personal financial matters.