Dividend reinvestment plans should be avoided because of their relatively high cost.

Question

Quizplus · Accepted Answer

Dividend reinvestment plans (DRIPs) typically have low or no fees, making them a cost-effective way for investors to automatically reinvest their dividends and compound their portfolio returns over time. While there may be some administrative fees or commission charges associated with certain DRIPs, these costs are generally small and do not outweigh the long-term benefits of reinvesting dividends. Therefore, DRIPs are a good option for investors who want to build wealth over time without incurring unnecessary expenses.

Dividend Reinvestment Plans Should Be Avoided Because of Their Relatively