If you reinvest, which is what I do, you just need to make sure you have the money to cover the taxes you’ll owe at the end of the year for those funds that were reinvested. If you take cash instead, you can remove the tax amount prior to reinvesting or spending.

With ETFs one of the benefits to reinvesting is the entire amount will be put back into the ETF. if you choose cash, more than likely, you won’t be able to reinvest the entire amount (minus tax) because it won’t add up to the full share price. An example - If you own shares of VTI at today’s price of $177.68 and your dividend is $50, you can’t reinvest in the ETF. Only full shares can be purchased. If you are set to reinvest, that $50 will be reinvested in a fractional share.