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Dividend Calculator
Project your dividend income with growth modelling and reinvestment comparison.
DRIP Modelling
Compare reinvested vs cash dividends
Dividend Growth
Model increasing dividends over time
Yield on Cost
See your effective yield vs original investment
Calculate Dividend Income
Project your dividend income with growth and optional reinvestment.
How Dividend Income Is Calculated
Dividend Yield and Income
Annual Income = Portfolio x Yield
Yield on Cost = Current Dividend / Original Investment
Dividend yield is the annual dividend per share divided by the share price. As dividends grow, your yield on cost — the dividend relative to your original purchase price — can become much higher than the current market yield.
Ex-Dividend Dates
Companies announce dividends with ex-dividend and payment dates. You must hold shares before the ex-dividend date to receive the payment. UK companies typically pay dividends twice a year (interim and final), while US companies often pay quarterly.
The Power of Dividend Reinvestment
Taking Dividends as Cash
You receive regular income but your share count stays constant. Income grows only if the company increases its dividend. Good for retirees or those needing income now. Total return relies primarily on share price appreciation.
Reinvesting Dividends (DRIP)
Dividends buy more shares, which generate more dividends next period — a compounding snowball. Over 20 years, reinvested dividends can double the total return vs taking cash. The effect accelerates over time as your share count grows exponentially.
How to Use This Dividend Calculator
Enter Investment & Yield
Starting amount and current dividend yield.
Set Growth Rates
Dividend growth and share price growth assumptions.
Compare DRIP vs Cash
Toggle reinvestment to see the compounding difference.
Building a Dividend Income Portfolio
- Yield vs growth. High-yield stocks pay more now but may grow slower. Growth stocks reinvest earnings and may increase dividends faster. A mix of both balances current income with future growth.
- Diversify across sectors. Don't concentrate in high-yield sectors like utilities and banks. Spread across industries so a sector downturn doesn't slash your income.
- Look for dividend aristocrats. Companies with 10-25+ years of consecutive dividend increases are more likely to maintain and grow their payouts through economic cycles.
- Use tax-efficient wrappers. In the UK, dividends within an ISA or SIPP are completely tax-free. The £20,000 ISA allowance can shelter a significant dividend income portfolio from tax.
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