Dividend Calculator with DRIP
See what your holding pays today, then project how reinvesting every payout and a growing dividend snowball over the years.
| Per month now | — |
| Yearly dividends in year — | — |
| Per month then | — |
| Portfolio value then | — |
| Yield on what you put in | — |
| Total dividends collected | — |
Year by year
| Year | Put in | Dividends that year | Per month | Value |
|---|
How the projection works
Each month the share price grows by the monthly equivalent of the price growth rate, your monthly amount buys more, and one twelfth of the yearly dividend is paid. With DRIP on, that dividend (after tax) buys more shares the same month. With DRIP off it is paid out and counted in the total collected.
The dividend per share grows once a year by the dividend growth rate. That is why yield on what you put in keeps rising even though the fund's own yield stays about the same.
Picking realistic numbers
- High yield usually means slower dividend and price growth. A 9% yield with 0% growth and a 3% yield with 10% growth can end up in very different places.
- Dividends get cut. Past growth is not a promise.
- Price growth plus yield is the total return. Keeping that sum near 8% to 10% a year keeps the projection honest.
A worked example
With the defaults, $25,000 at a 3.6% yield pays about $900 a year today, or $75 a month. Adding $300 a month, reinvesting everything, with the dividend growing 6% a year and the price 4% a year, after 15 years the yearly dividends reach roughly $8,200, about $680 a month. You will have put in $79,000, so the income alone is over 10% of what you invested. Turn off DRIP and the income in year 15 drops noticeably, because the dividends are no longer buying more shares.
Common questions
What is the difference between yield and yield on cost?
Yield is this year's dividend divided by today's price, and it is what a new buyer gets. Yield on cost is this year's dividend divided by what you actually paid. When a company keeps raising its dividend, your yield on cost climbs year after year even if the quoted yield stays the same.
How are dividends taxed?
Qualified dividends from most U.S. stocks held long enough are taxed at 0%, 15% or 20%, the same rates as long-term capital gains. REIT dividends and most income from option-income funds such as JEPI are taxed as ordinary income. In an IRA or 401(k) there is no tax until you withdraw, or none at all in a Roth.
Is DRIP always better?
For building wealth, reinvesting usually wins because each payout buys shares that pay their own dividends. If you are living on the income, you will want the cash instead. In a taxable account, reinvested dividends are still taxed in the year they are paid.
Where do I find a fund's dividend growth?
Every ETF and stock page on this site lists the yearly dividend for the last ten years and the five-year growth rate, worked out from actual payments.