This time of year is a nice reminder of one of the key benefits of owning Australian shares: the income and franking credits that start to roll in. In a time of significant volatility in sharemarket values, it is nice to remember this key benefit of owning shares: potential exposure to a growing and tax advantaged income stream.
Many companies offer a "dividend reinvestment plan", where rather than take dividends as income, the investor can choose to take the dividend as more shares. This article compares the two ways of receiving income; should you take income as dividends or as extra shares?
Scott Francis has contributed an article to the latest edition Alan Kohler's Eureka Report which looks at the arguments for and against dividend reinvestment. Click on the following link to read Scott's article - The money or the stocks?