How the dividend calculator works
Dividends in a year = value of your shares × dividend yield
Each year the dividend per share grows by the dividend growth rate, and the share price by the price growth rate. If you reinvest, that year’s dividends buy more shares at the year’s price, so next year you’re paid on more shares.
Example
10,000 at a 4% yield pays 400 in the first year. With 5% dividend growth and 3% price growth, reinvested for 10 years, the dividends grow to about 900 a year.
Yield on cost
The calculator also shows your yield on cost: the last year’s dividends as a share of all the money you put in. It shows how much a growing dividend can pay on your original investment.
Frequently asked questions
What is dividend yield?
The yearly dividends as a share of the share price. A share that costs 50 and pays 2 a year in dividends yields 4%. You'll find it on any stock or fund page.
What does reinvesting dividends do?
Each dividend buys more shares, and those shares pay dividends too, so your income grows faster over time. Many brokers offer this automatically (a DRIP, or dividend reinvestment plan).
Are taxes included?
No. Dividends are often taxed, and some countries take a withholding tax on foreign dividends. Lower the yield to roughly what you keep after tax for a closer estimate.
Are these results guaranteed?
No. Companies can cut dividends and share prices go down as well as up. The calculator shows what happens if the yield and growth you enter hold steady.
