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Be sure to check out the hobbyist sections of our site. We're in the process of rolling out sections on photography and everyday gadgets. We don't focus on the cutting edge, new technologies -- we're focusing on how to use new technologies in everyday life.
Gadgets
every day uses for new and old technologies.
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Investment Strategies - Dividend Reinvestment
Dividends are basically returns from an investment. Investors must choose to either consume (spend) the dividend payment or to invest it in the same investment or some other investment. The term dividend reinvestment generally refers to dividends being invested back into the investment from which they were earned.
The benefits derived from this strategy can be quite impressive. If an investor chooses to consume dividends, the principle will have grown only from appreciation. For example, assume a stock selling for $30 pays a dividend of $2.00 at the end of each year and will appreciate over time at a compound rate of 10%. The following table illustrates the results of consuming or reinvesting the dividends after 10 years.
| Consuming Dividends | Reinvesting Dividends | |
| PV = | $30.00 | PV = | $30.00 |
| n = | 10 years | n = | 10 years |
| i = | 10% | i = | 10% |
| PMT = | $0.00 | PMT = | $2.00 |
| FV = | $77.81 | FV = | $109.69 |
As you can see, reinvesting the dividends will resulted in a 41% larger asset at the end of a 10 year period (given the assumptions above).
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If you're looking for information on the the FinPlan Divorce Planner (from the other FinPlan company), please continue on to http://www.divorceplanner.com.
Note - FinPlan.com does not offer any information regarding this program nor does it have any relationship with the company offering the software. This link is provided as a service only.
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FinPlan.com offers several online tools and calculators as well as some software programs from FinPlan, Inc. FinPlan started developing software in the 1980s developing 10 programs covering several personal finance topics.
Family Retirement Planner
The FinPlan Family Retirement Planner provides an excellent high-level retirement planning model to help you determine your retirement planning needs which will allow you to develop a strategy to get there.
Financial Toolkit
The FinPlan Financial Toolkit provides a variety of financial tools designed to help you answer many questions on personal finance.
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