Many of these tips will no doubt apply to Computershare US and Australia, etc., too. I’ve been thinking about Computershare again lately as I try to get two more DRIPs up and running (if you don’t know about DRIPs, read about why I think you should be in them or how they’re perfect no matter what your age or investing experience is). One in particular has been going through strange administrative difficulties, mostly due to luck and timing, I think. In none of these cases do I blame Computershare for anything. They’ve almost always been very personable and pleasant enough to deal with if you’re organized and know what you’re talking about. I’ve dealt with Computershare for nine years now and I think I’ve only had one frustrating customer service conversation. Others’ experiences differ, of course, and everyone has their own level of tolerance for different things.

So this is what I’ve learned from the last few bumps in the road:

(1) Always keep a record of your certificate number and the date the certificate was issued (which is not always quite the date you paid for it or ordered it; you’ll have to check your brokerage records and/or the certificate itself). You’ll need these especially as security verifications of your account for those times when you need to get in touch with Computershare about something but your account hasn’t been set up yet because it’s too new and you do not yet have a holder account number. So write these important numbers down AS SOON AS you receive your certificate.

(2) Make sure that you always register each certificate and/or each new account in the exact same name and address, so that you can access them altogether under one online account. If your name is John B. Herrington, make sure you always register new certificates and accounts using that middle initial, otherwise you’ll end up with one online account showing all the shares you registered under “John Herrington,” and another online account for everything you registered under “John B. Herrington.” This may not sound like a big deal, but it is after the fact if you later decide you want to put everything under the same name. You’ll end up having to re-register shares by transferring them to yourself in a process that could take weeks. As an example, I’ve recently been through this process myself, and I am still trying to get a DRIP running for a share that I bought back in April 2008. These comments apply to your address too. If you live on Bonds Street, make sure that you always register things using the same consistent spelling. You might not think it would matter and that everyone would know that “St.” means the same thing as “Street,” but I’ve had accounts go unregistered and share transfers not take place on time because my address “did not match” for this very reason!

(3) If for some reason you need to place a stop payment on a cheque that you had sent in for an optional cash payment, make sure that you also call in and tell Computershare about it before they cash it. This point might apply to using stop payments with all kinds of companies, but this was the first time I’d needed to use a stop payment and was surprised to be charged an extra $25.00 by Computershare because they didn’t know a stop order had been placed and they went ahead and tried to cash the OCP cheque. And I’d already paid $12.50 at my bank in order to place the stop payment in the first place! So this point brings up another one:

(4) Just an extremely simple good budgeting and records tip, here (students pay extra attention!): keep very close track of what cheques you have coming out of your account as well as all other debits that might be coming out. I tend to run my chequing account down to the wire, that is, I don’t leave any cash in there “floating.” All cash goes immediately to bills, expenditures or investments. But this runs me into danger when sometimes I have too many cheques at crosshairs and end up with not enough money in there to cover something. Don’t forget about end-of-month bank fees that might not be withdrawn until 11:59pm or even early morning the next month. For all of these reasons, it might be a better idea to just leave a float of $100 or whatever size cushion in your account just in case. Some people will use overdraft for this purpose, but overdraft often costs you money as well.

(5) If you think you might want overdraft protection on your account, get it while it’s offered (or available) to you. My bank has offered it to me on the phone several times before (you know, at the end of the call when you’re really put off by extra sales gimmicks) but I always turned it down. Then when I really needed it and applied for it, the bank refused me. Needless to say I was overdrawn and had to pay hefty fees around $40.00.

(6) Finally, if you call into Computershare and talk with someone and you receive confusing or less than satisfactory service for whatever subjective reason, (a) don’t take it out on the representative; this will cause angst and that representative might just keep passing that angst on throughout the rest of the day and to other callers (people just like you); b) just call back and you’ll probably get a different agent on the line. This agent might know more or have more experience than the other one and will have a different answer to your question. While this is a simple tip, it helps to keep it in mind. Remember, these are your investments you’re dealing with. You want to treat the people that help you with them with royal gloves (in all reasonableness, of course. If an agent is truly abusive or brunt, it might help to tell someone else about it, but do so in a diplomatic, non-hostile manner). Let’s remember that Computershare provides an excellent service and ultimately I think you want to be thankful about that. At least in Canada, anyways, there are less options for DRIPs than there are in the States, and we don’t want to take it for granted. This is the way I feel about it, anyway.

What about you? Do you have other tips for dealing with Computershare that I’ve left out here? Anything else to tell new “DRIPPERs” about? Leave a comment (or questions!) below or send me an email. Also, don’t forget to subscribe to the free feed to receive future posts.

It’s too bad, because eNorthern had really cheap prices on share certificates, which is one of the reasons I was interested in them in the first place.  Only $20.00.  I’m not sure why, but now eNorthern is closing its “doors” to new business.  Here’s what they posted on their site, if you click on “Open A New Account” (why they don’t just put it on the homepage, I’m not sure).

Notice from eNorthern:

“On or about August 1, 2008, eNorthern will wind up its online discount brokerage business.  To maintain uninterrupted access to your trading account, Questrade, Inc., a Toronto-based securities firm, will assume the role of your online broker on or about August 1, 2008.  Questrade is a member of IIROC (Investment Industry Regulatory Organization of Canada), CIPF (Canadian Investor Protection Fund), and a participating organization of the Toronto Stock Exchange, TSX Venture Exchange and the Montreal Exchange. Questrade also offers unique services such as the $4.95 stock trade and USD in RSP. For more information on Questrade, please visit www.questrade.com.

Your account will be automatically transferred to Questrade on or about August 1, 2008. In order to trade in your new Questrade account, you will need to complete and sign Questrade’s account opening documentation. Questrade will provide you with further details on this transfer after July 15, 2008.  If you do not want to transfer your account to Questrade you must inform eNorthern in writing by July 30, 2008 or inform Questrade in writing thereafter by August 31, 2008 and your account will be transferred to another brokerage without charge.  Questrade wants your transition to be as seamless as possible. Questrade has set up a special customer service team for eNorthern clients to answer any questions that you may have regarding the transition. To speak to a dedicated Questrade representative, please call 1.888.QUEST.66 (1.888.783.7866) or go to Questrade’s website to email or start a chat. To speak to an eNorthern representative please call 1-888-829-7929.  Questrade looks forward to serving all your trading needs.”

Questrade Certificate Prices Outrageously High

I keep going on about these certificate prices because they’re one of the ways you can enrol yourself in a DRIP.  Buy a share, then have it certificated.  But the certificate prices at Questrade are something like $300.  It’s like they’re really trying to discourage it for some reason - saving paper?  I doubt it.

I have my own reasons for not following the switch over to Questrade, however.  I’ve read a lot of negative word-of-mouth about their brokerage service.  Enough that I don’t want to try it.  You can always try to convince me otherwise, though.  Right now it looks like I just wouldn’t need them.  I’d go with TradeFreedom before Questrade.  What about you?  Are you really disappointed with this move by eNorthern?  I didn’t have a big account there, anyway, so it’s not going to be a real problem for me to move it out.

One less discount broker in Canada… making some of the others look even more attractive.

I’ve followed Ellen Roseman’s personal finance columns in the Sunday Toronto Star for more than a few years now, off and on, always looking forward to the possibility that I might find a new little financial gem of advice in there. Sometimes, I have. Most of the time I’m reminded and reinspired about what I do already know from reading I’ve already done. But

it’s rare to get the feeling “Hey, I’ve Already Written About That Myself!”:)

This Sunday’s column was all about DRIPPING! That’s right, it’s what I’ve been telling friends about for a while now and I’ve written about it already on this site in several places (and I’ve been doing it myself for almost a decade) — see some of the related posts below this one. Turns out that Roseman’s provided yet another public face in confirmation of these financial gems of solutions to your investing daydreams. Want to be invested, not sure how? Think it’s too expensive? Think you need to know alot of technical information before you can do it effectively?

Start simple with DRIPs.
Over time you can bring your effective cost to zero using DRIPs.
DRIPs are so easy to understand that kids can build their wealth with them, too.

The only worry I have with DRIPs going mainstream is that they become easier fodder for the brokers and regulators and provide new ways to take advantage of the small investor. I’m not sure exactly how this would happen but it’s always there in the background. Call me paranoid. The general idea has always been that DRIPs weren’t advertised and many people didn’t know about them, because if they did, brokers wouldn’t like the fact that they’d lose all their commissions to these fee-free plans. I have to wonder how many brokers actually use DRIPs themselves for their own finances. On the other hand,

a greater public eye towards DRIPs might be a good thing if enough DIY investors move away from the brokers so that they can save money - alot of money - through DRIPs.

And remember, I’m not talking about simply reinvesting your dividends on stocks you already hold at BMO Investorline or TD Waterhouse. Those aren’t really DRIPs. DRIPs are what you use when you invest directly with the company itself (going through their transfer agent, of course). But people have used this argument with Mutual Funds in the face of low-cost ETFs. The reasoning is that with the new low costs of ETFs, and their rising popularity, mutual fund costs should go down if less people put their money in them. We’ve already seen some of that in Canada - apparently we’ve all been sitting on, hoarding our cash this year rather than plopping it into the usual funds. But I can tell you that none of my mutual fund fees have dropped, and it doesn’t look like there have been any major trends that way across the board.

It took quite a bit of industry advertising to create the ETF boom we see today - they’ve really taken off since about 2003 or so in the mainstream, but even more more recently than that. For some reason, I don’t think DRIPs will ever become that popular. First, they require more work and individual attention and analysis (not alot by any means, but way more than you need to do with a broker, who does all of that for you). Second, they’re — shh! — *boring*. Yeah, that common criticism does ring a bell. They just do their work quietly behind the scenes. They’re long-term investments and if you can automate them, they’ll become duller than dry paint. But they work! Why introduce complications when you don’t need to.

Roseman will be doing a follow-up column next week. While it’s great to see, you can’t fit much into those three little print columns. Hopefully you will come back here too for more information on these plans. Send me your questions and comments. I can plan future posts around your specific inquiries (I already have). Tell me about your latest DRIP!

I should offer another plug for Roseman, too. You can read through all of her previous articles in a great archive on the Star’s site here. It’s wonderful if you’ve missed a week or just don’t subscribe to the Star. I know I skip through most of the front section and head right away to those back two pages in “Business” each Sunday. But if you’d like even more reading, Roseman has her own blog, too, which I highly recommend.