Dividend Reinvestment Calculator

What Is Dividend Reinvestment?

When a company pays a dividend, you can either take it as cash or use it to automatically buy more shares of the same stock — a Dividend Reinvestment Plan, or DRIP. Reinvesting doesn't change what the company pays you, but it changes what you do with it: instead of that money sitting idle, it immediately starts earning its own dividends and riding any price growth alongside your original shares.

Over short periods the difference is small. Over decades, it compounds into something much bigger, because every reinvested dividend buys shares that go on to pay their own dividends — which get reinvested too, and so on.

How to Use This Calculator

Enter your investment amount, the current share price, and the stock's dividend yield. The annual dividend growth and share price growth fields come pre-filled with reasonable long-run defaults, but adjust them to match the stock or fund you're modeling. Enter how many years you want to project, and the calculator shows you both scenarios side by side.

How We Calculate It

We simulate your investment year by year. Each year, we calculate the dividend paid on your current shares. In the reinvested scenario, that dividend buys more shares at that year's price, so your share count grows every year on top of the price growth. In the cash scenario, your share count never changes — the dividend is simply set aside, uninvested, and added to your final total at face value. Both scenarios use the same annual dividend growth and price growth rates, so the entire difference between the two comes purely from what you do with the dividend itself.

A Few Notes

This calculator assumes constant annual growth rates for both the dividend and the share price, which real markets never deliver smoothly — actual returns will be lumpier in both directions. It also doesn't account for taxes, which can apply to dividends whether you reinvest them or not depending on the account type, or for brokerage fees. Treat this as a way to understand the mechanics and rough scale of reinvesting, not as a precise forecast of any specific investment's future.