Where Do Dividends Go On ETrade?

Where Do Dividends Go On ETrade?

As one of the largest and most trusted brokers out there, ETrade has a surprisingly complicated user interface. A lot of times it remains unclear where your dividend earnings actually go and how they are represented in the different accounts. Here’s a simple way to check where your dividends went:

Dividends on ETrade always go to your cash account with two exceptions. Dividends do not go to your cash account if the dividend payout is in the form of a security. If you have activated a DRIP dividends will be automatically reinvested and don’t appear in your cash account.

Let’s look at where dividends go in a bit more detail as the matter is slightly more complicated than expected at first glance. ETrade will distribute your dividends to different accounts depending on your account setup and the type of dividend that is being distributed.

Where is my dividend on ETrade?

As mentioned above, dividends in the form of cash will be added to your ETrade cash account. There are a few simple ways to check whether this dividend transaction has actually occurred. I will highlight the three most common ones here:

  • Check your tax lots: Go to Accounts > Portfolios > Positions and expand all sub-menus of the fund that you want to check the dividend history for. Compare the given tax lots with your initial investment in the fund. If the tax lot has increased, the dividends have been reinvested.
  • Check your transactions: Go to Accounts > Transactions and set the transaction type to ‘Dividend’. Set the timeframe to YTD or whatever is most convenient at the time and scan the transactions. If no transactions appear try setting the transaction type to ‘Distribution’. If you are unable to find any transaction, the dividends have not been paid.
  • Check your statements: Got to Accounts > Documents > Brokerage Statement and download the statement for the given timeframe where you expect the dividend to have been paid out. The easiest way to find this is to look for the Account Transaction Summary.

Why are my Dividends not showing on ETrade?

If your dividends are not showing in your cash account and you can’t find any solution from the three steps outlined above there are only three options left. Either no dividend has been paid out at all, the dividend has been reinvested automatically, or the dividend payment is still being processed.

In some cases, dividend payments on ETrade may take a couple of days to post. This means that it may take 1-3 business days for the transaction to actually appear in your account statements. For instance, if a dividend payment was scheduled for Friday one week, it might not appear in your account until Monday or Tuesday of the following week.

If your dividends are still not showing after more than 3 business days make sure to contact ETrades customer service at 800-387-2331.

Are Dividends on ETrade automatically reinvested?

Dividend Reinvestment Plans (or DRIPs) can be a fantastic way to accumulate compound interest on your investments. However, these might be working against you if you plan to accumulate dividend payouts in a separate account.

Usually, DRIPs are not automatically activated and the dividend payment on ETrade will appear in your cash account. In some instances, however, your dividends will be automatically reinvested.

Such is the case for most mutual funds on ETrade. Here, the dividend reinvestment option is automatically activated once you invest in the fund. This means that any dividend payout the given mutual fund disbursed will NOT appear in your cash account.

I will show in the next step how to turn off this default setting and have your dividend payments appear in your cash account!

How to reinvest Dividends on ETrade

First, let’s briefly discuss how you can go about activating your DRIPs and reinvest your dividends on ETrade. This can be done by going to the ‘Dividend Reinvestment’ tab in your investment portfolio and checking the box for DRIP.

Here are some things to consider before activating your DRIP:

  • Even though dividends are directly reinvested through a DRIP they still count as earnings and are thus a taxable event.
  • You won’t receive any dividend payouts in your cash account.
  • When the dividend is not large enough to buy one whole share of the stock you will end up with fractional shares. These, in turn, can only be transferred to or redeemed by a broker that supports fractional shares.

Overall ETrade offers a rather antiquated way of dealing with and tracking your dividends. For a truly innovative and easy-to-track dividend reinvestment plan check out my favorite brokers here. I have been using them to collect my dividends for over a year now without any issues whatsoever.

Current recommendations:

Over the past years, I have discovered several tools and products that have helped me tremendously on my path to financial freedom:

P.S.: The links below are affiliate links, which means I receive a small commission at no extra cost to you when you sign up for one of the services. Thank you for your support!

1) Take a look at M1 Finance, my favorite broker. I love how easy it is to invest and maintain my portfolio with them. I can set up automatic transfers, rebalance my portfolio with one click and even borrow up to 35% of my assets at super low interest rates!

2) Fundrise is by far the best way I've found to invest in Real Estate. You can diversify your portfolio by investing in their eREITs or even allocate capital to individual properties (without the hassle of managing tenants!).

3) If you are interested in crypto, check out Gemini. I've started allocating a small amount of assets to the growing crypto space and Gemini has just been a breeze to use. Once you register, make sure to also open an Active Trader account to buy crypto at the lowest fees on the market (just 0.03%!).

To see all of my most up-to-date recommendations, check out the Recommended Tools section.

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