Ask Doug

Can I Purchase DRIPs through an IRA Account?

Q. How do I invest in DRIP stocks within a IRA? I currently have a IRA with Schwab, but I am sure they will not help me with DRIPs -- after all, they're in the business of making money though the sale and purchase of stocks. Please help!

A. While Charles Schwab and other brokers often offer "free dividend reinvestment," these "synthetic DRIPs" are missing one important feature that real DRIPs have: the ability to make additional purchases through the plan with little or no commission or fees.

A handful of DRIPs allow you to invest in their stock in IRA accounts. Here's a short list:

  • Allstate Corp.
  • American Electric Power
  • Atmos Energy Corp.
  • Blue Chip Value Fund, Inc.
  • Campbell Soup Co.
  • Connecticut Water Serv.
  • Exxon Mobil Corp.
  • Fannie Mae
  • Ford Motor Co.
  • Hershey Foods
  • Interchange Fi. Services
  • Intimate Brands, Inc.
  • Lucent Technologies Inc.
  • McDonald's Corp.
  • MidSouth Bancorp, Inc.
  • OGE Energy Corp.
  • ONEOK Inc.
  • Philadelphia Suburban Corp.
  • ProLogis Trust
  • Reliant Energy
  • SBC Communications
  • Sears, Roebuck and Co.
  • South Finl. Group, Inc. (The)
  • Thornburg Mortage Asset
  • UtiliCorp United
  • Verizon Communications, Inc.
  • Wal-Mart Stores
  • Washington REIT
  • Wesbank Corp