Dividend Yield Calculator
Project your dividend income over time and see how reinvesting dividends (DRIP) compounds your returns. Enter a stock's price, yield, and expected growth to model different scenarios.
A $100 stock with a 4% dividend yield pays you $4 per share per year. If the stock price grows 5% annually, after 10 years you'd collect $50.31 in dividends as cash, for a total of $213.20. With reinvestment (DRIP), those dividends buy more shares — growing your portfolio to $241.12, an extra $28 from compounding alone.
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Understanding Dividend Investing
Key concepts for income-focused investors
What does dividend yield tell me?
Dividend yield is the annual dividend payment divided by the stock price, expressed as a percentage. A $100 stock paying $3 per year has a 3% yield. It tells you how much cash income you earn for each dollar invested, making it easy to compare income potential across different stocks.
Be cautious of unusually high yields (above 6-8%). They can signal that the market expects a dividend cut, or that the stock price has dropped sharply. The safest dividend stocks typically yield 2-4% with a long history of increasing payments year after year.
Should I reinvest my dividends or take the cash?
Reinvesting dividends (DRIP) is one of the most powerful wealth-building strategies available. Instead of pocketing the cash, you use dividends to buy more shares, which then generate their own dividends. Over decades, this compounding effect can more than double your total returns compared to taking cash.
Take the cash instead if you need the income now (such as in retirement), or if you want to rebalance your portfolio by directing dividends elsewhere. The right choice depends on your financial situation and investment timeline — reinvest if you're building wealth, take cash if you're living off your investments.
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