- 1). Contact the investor's relations department of the company you wish to establish a DRIP IRA account with. Ask whether they allow IRAs to purchase stock under the DRIP specifications. Not every company allows this. You may be directed to the transfer agent (the company that directly handles the stock issues) to obtain more details. If neither the company nor its transfer agent allow this, contact a brokerage firm that does allow DRIP programs. Brokerage houses such as Charles Schwab or TD Waterhouse allow these programs. Your initial purchase will have a commission associated with it, the re-investment of dividends will not. When you sell the complete amount of shares, you will pay a commission on the transaction. This isn't as inexpensive as going directly to the company, but may be the only way to achieve a DRIP investment program.
- 2). Obtain paperwork that transfers an IRA to the DRIP transfer agent or new IRA custodian. Check with the new custodian about liquidating all assets into cash prior to transferring. Some custodians will require this for the transfer to occur while others have in the paperwork a section that states to "liquidate and transfer cash," eliminating one step you must take.
- 3). Fill out the paperwork and sign it. Submit it to the new IRA custodian along with a copy of your most recent IRA statement.
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