Dividend Reinvestment Calculator
See how reinvesting your dividends — instead of taking them as cash — compounds into a bigger portfolio over time. Models dividend growth, share price appreciation, and regular contributions, all in your browser. No sign-up.
How your balance grows
Contributions vs. growth from dividends and price appreciation, year by year. Hover the chart for exact numbers.
Reinvesting vs. taking cash
The same investment, side by side: one path reinvests every dividend, the other collects them as cash instead.
Trying to hit a specific savings target instead? The savings goal calculator works backward from a target amount to tell you the required monthly contribution.
What is dividend reinvestment (DRIP)?
A Dividend Reinvestment Plan, or DRIP, automatically uses the cash dividends a stock or fund pays out to buy more shares instead of depositing that cash into your account. Those new shares then earn their own dividends next payout, which buy still more shares — the same snowballing mechanism as compound interest, just powered by dividend income instead of interest income.
This calculator simulates that process: each payout period it takes your current dividend yield, applies it to your balance, and — if you're modeling reinvestment — adds that payment straight back into your balance so it starts compounding immediately.
Why reinvesting dividends compounds faster
Every dividend you reinvest buys more shares. Those extra shares pay their own dividends at the next payout, which buy even more shares. Over enough payout cycles, a meaningful share of your final balance comes not from your original investment or your own contributions, but from dividends that bought shares that then paid their own dividends. The "Dividends reinvested" figure above isolates exactly that effect for your numbers.
Two other inputs matter more than people expect: the dividend growth rate (many established dividend-paying companies raise their payout most years, so 3-6% annual dividend growth is a common planning assumption) and the payout frequency (more frequent payouts mean each dividend has more time left in the year to keep compounding, though the difference is smaller than it might seem — similar to how compounding frequency matters less than the rate itself).
A worked example
$10,000 invested at a 3.5% starting dividend yield, with dividends growing 5% a year and the share price appreciating 6% a year, reinvested quarterly with a $100 monthly contribution added on top: after 20 years that grows to about $203,665. Of that, $34,000 is money contributed, roughly $92,988 came from reinvested dividends compounding on themselves, and the rest — about $76,677 — is price appreciation on the whole growing balance. Had those same dividends been taken as cash instead of reinvested, the same scenario would end with about $77,415 still in shares plus roughly $49,797 collected in cash along the way, for a combined total near $127,212 — about $76,453 less than reinvesting produced, purely from letting dividends buy more shares instead of sitting in cash.
Is this calculator accurate for a specific stock?
It's a simplified model: it applies your dividend yield to your whole balance each period and grows that yield and the share price at the flat annual rates you enter. Real dividend investing involves a specific per-share price and dividend that both move unevenly, dividend cuts as well as raises, and taxes on dividend income. Use this to compare assumptions and "what if" scenarios, not as a guarantee of what any real stock or fund will do.
Should I use dividend yield or dividend growth rate as my main number?
Both matter, but they trade off differently. A higher starting yield puts more cash to work reinvesting sooner; a higher dividend growth rate compounds that yield higher every year, which matters more the longer your time horizon is. Try raising each one separately in the calculator to see which moves your result more for your own timeframe.
What's a realistic dividend yield and growth rate to assume?
There's no single right answer — it depends entirely on what you're invested in. Broad dividend-focused index funds have historically yielded roughly in the 2-4% range with mid-single-digit annual dividend growth; individual high-yield stocks can start higher but grow their payout more slowly or cut it. Use your own holdings' actual figures where you can, and treat any assumption as an estimate, not a promise.
Does this account for taxes?
No — this calculator shows pre-tax growth. Dividends are often taxable in the year you receive them even when reinvested (unless held in a tax-advantaged account), which reduces the amount that actually gets reinvested in a taxable account. Check with a tax professional about how dividend income is treated for your specific accounts.