What Is a DRIP?

DRIP is an acronym for Direct Investment Plan. Hundreds of excellent companies allow individuals to set up accounts on the books and records of the company. That way they can cut out the middleman and invest directly into their own accounts.

After you setup the account, when the next birthday, graduation, or other milestone rolls around, you can contribute additional funds to it. Or, of course, you can fund the account on a regular basis.

Of course, the lucky recipient of your gift will be able to make subsequent investments—even if the amount available for investment is as little as $10 or $25.

This gift gives your loved one a head start in terms of building wealth for his or her long term needs.