Dividend Calculator

Quick start

1. Enter your number of shares and share price
2. Choose distribution frequency (how often dividends are paid)
3. Select DRIP Yes/No (whether to reinvest dividends)
4. Enter dividend yield and expected growth rates
5. Set tax rate and investment time horizon
6. See your ending balance, dividend income, and returns instantly

Your results — what they mean

• Ending Balance: Total portfolio value at the end
• Total Return: Overall percentage gain/loss
• Average Annual Return: Compound annual growth rate (CAGR)
• Annual Dividend Income: Final year dividend payments (after tax)
• Total Dividend Payments: Cumulative dividends over entire period
• Yield on Cost: Current dividend yield based on original cost

How this calculator works (plain English)

• Calculates year-by-year dividend payments based on your yield and share count
• Applies dividend growth rate annually
• Reinvests dividends to purchase more shares if DRIP enabled
• Accounts for taxes on dividend income
• Projects share price appreciation
• Adds annual contributions at year-end

Tips to maximize dividend income

• Choose quality dividend growers: Companies with history of increasing dividends
• Enable DRIP for compounding: Reinvest dividends to accumulate more shares
• Consider tax-advantaged accounts: Use IRA/401k for tax-free dividend growth
• Diversify across sectors: Don't concentrate in one industry
• Focus on sustainable yields: Very high yields (>8%) may indicate risk
• Monitor dividend payout ratios: Ensure dividends are sustainable
• Be patient: Dividend growth compounds best over long time horizons

FAQs

Assumptions

• Dividend yield and growth rates remain constant
• Share price appreciation rate remains constant
• Tax rate doesn't change over time
• Annual contributions happen at year-end
• No transaction fees or brokerage costs
• No early withdrawals or sales
• Results rounded to 2 decimal places for display

Glossary (all terms used)

Dividend:

Cash payment from company to shareholders

Dividend Yield:

Annual dividend as percentage of share price

DRIP:

Dividend Reinvestment Plan - automatic dividend reinvestment

Yield on Cost:

Current annual dividend yield based on original purchase price

Distribution Frequency:

How often dividends are paid (monthly, quarterly, etc.)

Dividend Growth Rate:

Annual percentage increase in dividend payments

Price Appreciation:

Increase in stock share price over time

Total Return:

Overall percentage gain including dividends and price appreciation

CAGR:

Compound Annual Growth Rate - average yearly return

Fractional Shares:

Owning less than one full share