First, a bit about my current investments.
100% of my retirement savings is spread over several index funds.
~50% of my non-retirement investments are in DRIPS, the other 50% are in index funds. I only buy & hold.
I've been enrolled in DRIP plans for about 2 years, and I'm very happy with them.
On to your question!
Not all DRIPS are completely free, but many are. Let's take, for example, one of my favorite DRIP stocks right now, Union Pacific:
Initial Setup Fee $0.00
Cash Purchase Fee $0.00
Ongoing Automatic Investment Fee $0.00
Purchase Processing Fee (per share) $0.00
Dividend Reinvestment Fee Company Paid
Batch Sale Fee $15.00
Batch Sale Processing Fee (per share) $0.12
Batch Maximum Sales Fee N/A
Market Order Sale Fee $25.00
The only fees associated with this DRIP are sale fees. I'm a buy & hold investor - I'm not planning on selling for a long time. What's the trade-off for paying absolutely nothing in commission fees? You don't get to try and time the market, buying at an exact moment. But I'm not a silly person trying to time the market, so I'm happy to buy shares automatically every month.
Most of my DRIPS are free, but not all. I invest in Intel, which charges $2.50 + $0.10 per share on automatic purchases. I can live with that, because I think it's a good buy, and the price is still better than an online broker.
The majority of my DRIPS are through Computershare.com and BNY Mellon Shareowner Services. These websites handle DRIP programs for companies. A few of my DRIPS are run directly by the companies themselves, such as Duke Energy.
Hope this helps! If you have more questions about DRIPS, let me know.