Enter your investment parameters below to see the potential growth with and without dividend reinvestment.
Your investment with DRIP will be:
0
Your investment without DRIP would be:
DRIP provides an advantage of:
Total dividends reinvested:
Total shares owned with DRIP:
The DRIP calculation estimates how reinvesting dividends to buy additional shares increases your compounded returns over time by combining dividend yield with share price growth.
Key formula: combined_growth = (1 + annual_share_price_growth_decimal) * (1 + annual_dividend_yield_decimal) - 1 FV_drip = initial_investment * (1 + combined_growth)^years + additional_annual_investment * ((1 + combined_growth)^years - 1) / combined_growth
combined_growth = (1 + annual_share_price_growth_decimal) * (1 + annual_dividend_yield_decimal) - 1 FV_drip = initial_investment * (1 + combined_growth)^years + additional_annual_investment * ((1 + combined_growth)^years - 1) / combined_growth
Example values: initial $10,000; dividend yield 3%; annual price growth 7%; 10 years; $1,000 added per year.
No. The calculator assumes gross reinvestment and does not factor in taxes, withholding, or brokerage fees; adjust results externally for net returns.
The tool uses an annual dividend yield. It assumes dividends are reinvested when paid and compounds effectively on an annual basis; for intra-year granularity use a more detailed model.
Regular additional investments increase the capital that benefits from combined growth and reinvested dividends, substantially boosting long-term compound returns.
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