Dividend Calculator
See the income a dividend yield produces — annual, quarterly, and monthly — and project what reinvesting it (DRIP) grows into. The model tracks actual shares: quarterly payouts buy more shares, the dividend per share grows each year, the price appreciates, and optional annual contributions add fuel. You get the future value, future income, total dividends, your yield on cost, and the exact dollar gap between reinvesting and taking the cash. All in your browser.
Year-by-year breakdown
| Year | Shares | Dividends | Value | Yield on cost |
|---|
The model tracks shares: each quarter the price appreciates, every share pays a quarter of the annual dividend, and with DRIP on the payment immediately buys more shares — so next quarter's dividend is bigger. The dividend per share grows once a year. Yields drift in real life and dividends can be cut; payouts are usually taxable even when reinvested. For context, the S&P 500 yields about 1.3% and large dividend growers have historically raised payouts around 5–6% a year.
Income now vs growth later
Dividends offer two things at once: cash in hand today, and — if you reinvest — a compounding snowball for tomorrow. Taking the cash gives you income to spend; reinvesting via a DRIP buys more shares that themselves pay dividends, which buy more shares. The calculator runs both paths through the same simulation and reports the difference as a single dollar figure, so you can see exactly what reinvesting is worth over your horizon. Sensible inputs help: the S&P 500 currently yields around 1.3%, classic dividend payers sit around 2–4%, and long-running dividend growers have historically raised payouts about 5–6% per year.
Yield on cost: the payoff for patience
The quoted yield is frozen at the moment you buy; what changes is the dividend itself. A company raising its payout 5% a year roughly doubles it in 14 years — so a position bought at a 3% yield ends up paying 6%+ on your original cost, regardless of where the price went. That figure is yield on cost, and the year-by-year table shows it climbing as the payout compounds. It's the quiet argument for buying dividend growth early and leaving it alone.
Mind the yield trap
A double-digit yield looks like free money and often isn't. Because yield is the dividend divided by price, it balloons when a stock falls — frequently right before the company cuts the payout it can no longer afford. Durable dividend income comes from healthy businesses with sustainable payout ratios and a history of raising the dividend, not from chasing the highest number on the screen.
Related
- Personal finance hub — all our money calculators and guides
- Compound interest calculator — reinvestment math
- ROI calculator — total return on an investment
- FIRE calculator — when income covers your expenses
FAQ
Is anything I enter sent to a server?
No. The calculator runs entirely in your browser — open DevTools → Network and confirm. Nothing you type is uploaded.
How is dividend income calculated?
Today's income is simply your investment times the dividend yield: income = amount × yield. A $10,000 position at a 3% yield pays $300 a year — $75 a quarter or $25 a month. The projection goes further: it tracks shares, paying a quarter of the annual dividend per share every three months while the share price appreciates and the payout itself grows each year.
What is DRIP and how does the projection work?
DRIP is a Dividend Reinvestment Plan — instead of taking dividends as cash, each payment automatically buys more shares (including fractions). Those new shares pay their own dividends next quarter, so the share count snowballs. The calculator simulates this quarter by quarter: price up, dividend paid, dividend reinvested at the new price, payout raised once a year. Flip the toggle to "Take as cash" and it shows the same position with dividends piling up uninvested — the gap between the two is what reinvesting earns you.
What is yield on cost?
Yield on cost (YOC) is the current annual dividend measured against what you originally paid, not today's price. Buy at a 3% yield and let the company raise its dividend 5% a year, and after a decade your shares pay about 4.7% on your original dollars — even if the quoted yield for new buyers hasn't moved. It's the number that shows why dividend-growth investors care more about the growth rate than the starting yield.
Is a high yield always better?
No — a very high yield is often a warning, not a gift. Yield is dividend ÷ price, so it spikes when a stock's price has crashed (a "yield trap"), and an unsustainable payout frequently gets cut. A moderate, growing dividend from a healthy company usually beats a sky-high yield that's about to be slashed. Look at the payout ratio and dividend history, not just the headline yield.
How are dividends taxed?
It depends on your country and account. In the US, "qualified" dividends are taxed at lower long-term capital-gains rates, while ordinary dividends are taxed as income — and dividends in a tax-advantaged account (IRA/401k) grow tax-deferred or tax-free. This calculator shows pre-tax figures.