How do dividends work with T. Rowe Price funds?

Dividends from T. Rowe Price funds typically arise from the income generated by the underlying securities held within the funds. These securities may include stocks and bonds that pay dividends and interest. When these companies or entities distribute dividends, T. Rowe Price may then pass this income on to fund shareholders in the form of dividend distributions. The frequency and amount of these distributions can vary. Most T. Rowe Price mutual funds distribute dividends on a quarterly basis, while some may operate on a different schedule. Investors can usually expect these distributions to be communicated via the fund's annual and semiannual reports or through account statements. Investors have options regarding how they want to receive dividends. They can choose to have them paid out in cash, or they may opt to reinvest the dividends back into the fund. Reinvesting allows dividends to purchase more shares, which can enhance long-term growth through the power of compounding. It is also important for investors to be aware of the tax implications associated with dividend distributions. The tax treatment may vary based on individual circumstances and can include both qualified and ordinary dividends. For specific information regarding dividend policies, potential shareholders may want to visit the T. Rowe Price website for additional resources and details.