Dividend calculator

A dividend is cash a company pays its owners out of its profit. Enter what you own, its dividend yield and the years. See your income each year, and what you gain if every payment buys more shares. You type the yield and any growth. We never pick them for you.

For any stock or fund, at the yield you enter · Free, no sign-up · The formulas
Start with

Type the yield of what you own: its yearly dividends per share, divided by its share price. The page opens with 4%, a made-up example.

Dividends
Growth, tax and extras

Leave both at 0 to keep the dividend and the price flat. Any number you type is your own what-if.

The share of each dividend that goes to tax.

See the IRS rates

Leave it empty to skip. The result shows the money needed and the year you get there.

With dividends reinvested, year 20 would pay

$1,730

in dividends, about $144 a month.

Made-up example: $20,000 at a 4% yield, paid 4 times a year. With every dividend reinvested, year 1 pays $812, year 20 pays $1,730 and the holding is worth $44,334. Taking cash pays $800 every year and leaves $36,000 in shares and cash.

$200.00First payment
$812Year 1 income
$1,730Year 20 income
$24,334Total dividends
$44,334Value after 20 years
2.2×Share count against day one
8.65%Income on what you put in
  • Reinvesting adds $8,334 over taking cash.
  • Reinvested, your dividends add up to what you put in during year 18. Taken as cash, it takes 25 years.
Today10 years20 years
Your balanceWhat you put in

Reinvested dividends widen the gap each year: $8,334 by year 20 in this example.

Year 1Dividends each yearYear 20
ReinvestedTaken as cash

The math with your numbers

  1. A year of dividends: $20,000 × 4% = $800.00
  2. Each payment: $800.00 ÷ 4 = $200.00
  3. First reinvestment: $200.00 buys 1% more shares
  4. Next payment: $200.00 × 1.01 = $202.00
Save my plan

Hypothetical illustration based on your inputs. Not a prediction, a recommendation, or the performance of any Amaltash strategy.

How it works: each dividend is your shares times the dividend per share, split across the payments in a year. Every rate is one you typed. Tax is taken off only if you type a tax rate. Real dividends can be cut or stopped, share prices can fall, and you can lose money.

Results change each time you change an input.

Fees, taxes and costs are not included unless you enter them.

See every year
YearDividends that yearAddedValueIncome on what you put in
1$812.08$0$20,8124.06%
2$845.05$0$21,6574.23%
3$879.37$0$22,5374.40%
4$915.07$0$23,4524.58%
5$952.23$0$24,4044.76%
6$990.89$0$25,3954.95%
7$1,031.13$0$26,4265.16%
8$1,072.99$0$27,4995.36%
9$1,116.56$0$28,6155.58%
10$1,161.90$0$29,7775.81%
11$1,209.08$0$30,9866.05%
12$1,258.17$0$32,2456.29%
13$1,309.26$0$33,5546.55%
14$1,362.42$0$34,9166.81%
15$1,417.74$0$36,3347.09%
16$1,475.30$0$37,8097.38%
17$1,535.21$0$39,3447.68%
18$1,597.54$0$40,9427.99%
19$1,662.41$0$42,6048.31%
20$1,729.91$0$44,3348.65%
Total$24,334.30$0$44,334

How to calculate dividends, step by step

To calculate your dividends, multiply the shares you own by the dividend each share pays in a year. Or multiply the money you have in it by the dividend yield. Then divide by the number of payments a year to get each payment. Here, 200 shares paying $2 each pay $400 a year.

  1. Find the yearly dividend per share. The company or fund lists it on its own page.
  2. Multiply it by the shares you own. That is a year of dividends.
  3. Divide by the payments in a year. That is each payment.
I=N×DI = N \times D

In words: Multiply your shares by the dividend each share pays in a year.

II
your dividends for the year
NN
the shares you own
DD
the dividend one share pays in a year
each payment=N×Dm\text{each payment} = \dfrac{N \times D}{m}

In words: Split the year of dividends by the number of payments.

NN
the shares you own
DD
the dividend one share pays in a year
mm
the payments in a year

Made-up example. This is plain math, not a forecast. You own 200 shares at $50 each. Each share pays $2.00 a year, so the yield is 4%. That is $400 a year, or $100 each quarter. Reinvest the first $100 and it buys 2 more shares. The next payment is then $101.

The other route gives the same answer. Your shares are worth $10,000, and 4% of $10,000 is $400.

Find what each share cost you with the stock average calculator →

How to calculate dividend yield

Dividend yield is the yearly dividend per share divided by the share price. A share that costs $50 and pays $2 a year yields 4%. The yield moves when the price moves, even if the dividend stays the same. So a very high yield can mean the price has fallen.

y=Dpy = \dfrac{D}{p}

In words: Divide the yearly dividend per share by the share price.

yy
the dividend yield, as a decimal
DD
the dividend one share pays in a year
pp
the price of one share

Made-up example. This is plain math, not a forecast. Here is the same $2.00 dividend at five share prices.

Share priceDividend a yearDividend yield
$25$2.008.0%
$40$2.005.0%
$50$2.004.0%
$80$2.002.5%
$100$2.002.0%

People quote yield in two ways. One uses what was paid over the last 12 months. The other takes the latest payment times the payments in a year. The two can differ, so know which one you typed.

There is no single good yield. A yield shows what is paid now, not what will be paid later.

Tax lowers the yield you keep. A 4% yield with a 15% tax leaves 3.4%.

ynet=y (1−τ)y_{\text{net}} = y\,(1-\tau)

In words: Take the tax share off the yield.

ynety_{\text{net}}
the yield you keep
yy
the dividend yield, as a decimal
τ\tau
the share of each dividend that goes to tax

Dividend reinvestment calculator: what does DRIP add to your shares?

DRIP stands for dividend reinvestment plan. Each dividend buys more shares, and those shares pay dividends too. In a made-up example, $10,000 at a 4% yield, paid each quarter for 30 years, pays $12,000 in cash. Reinvested, the same payments grow the holding to $33,004, with no change in price.

Nj=Nj−1+(1−τ) Nj−1 djpjN_j = N_{j-1} + \dfrac{(1-\tau)\,N_{j-1}\,d_j}{p_j}

In words: Each payment, after tax, buys more shares at that day’s price.

NjN_j
your shares after payment number j
djd_j
the dividend per share at payment j
pjp_j
the share price at payment j
τ\tau
the share of each dividend that goes to tax

When the price and the dividend never change, all those steps shrink to one line.

V=P(1+ym)mTV = P\left(1 + \dfrac{y}{m}\right)^{mT}

In words: With no growth, each payment grows your money by the yield split across the payments. Do that for every payment.

VV
the value at the end
PP
the money you start with
yy
the dividend yield, as a decimal
mm
the payments in a year
TT
the number of years

Made-up example. This is plain math, not a forecast. You start with $10,000. It is paid each quarter, and the price and the dividend never change.

Yield and yearsCash path (shares plus cash)ReinvestedReinvesting addsIncome in the last year, reinvestedIncome in the last year, cash
3% for 20 years$16,000$18,180$2,180$535$300
4% for 10 years$14,000$14,889$889$581$400
4% for 20 years$18,000$22,167$4,167$865$400
4% for 30 years$22,000$33,004$11,004$1,288$400
5% for 20 years$20,000$27,015$7,015$1,310$500
6% for 20 years$22,000$32,907$10,907$1,903$600

How long until reinvested dividends double your share count? This table uses quarterly payments and a flat price.

Dividend yieldYears to double your shares
1%69.4
2%34.7
3%23.2
4%17.4
5%13.9
6%11.6
8%8.8
10%7.0
T2=ln⁡2m ln⁡(1+y/m)T_2 = \dfrac{\ln 2}{m\,\ln\left(1 + y/m\right)}

In words: This gives the years for reinvested dividends to double your share count when the price does not move.

T2T_2
the years to double
yy
the dividend yield, as a decimal
mm
the payments in a year

Check a doubling time with the rule of 72 calculator →

Reinvested dividends grow the way compound interest does. Each payment goes on to earn its own payments.

See how each dollar you earn can earn more with the compound interest calculator →

A flat dividend taken as cash adds up the way simple interest does.

See what you earn when interest is not added back with the simple interest calculator →

See past S&P 500 returns with dividends reinvested in the S&P 500 calculator →

A company can run its own plan, and so can a broker. The SEC says to check if you will be charged for the service. Some company plans for buying stock direct ask that you already own shares.

Reinvesting has limits too:

  • More of your money ends up in one holding.
  • Tax is still due on each dividend in a taxable account.
  • The dividend can be cut, and the price can fall.

How much do I need to invest to make $1,000 a month in dividends?

Multiply the monthly income you want by 12, then divide by the dividend yield. For $1,000 a month at a 4% yield, that is $12,000 divided by 0.04, or $300,000. At 3% it is $400,000. At 5% it is $240,000. A yield is not a promise, and dividends can be cut.

P=12 My (1−τ)P = \dfrac{12\,M}{y\,(1-\tau)}

In words: Multiply the monthly income you want by 12. Divide by the yield you keep after tax.

PP
the money needed today
MM
the monthly income you want
yy
the dividend yield, as a decimal
τ\tau
the share of each dividend that goes to tax

Made-up example. This is plain math, not a forecast. This is the money needed today for each monthly income, before tax.

Monthly income2% yield3% yield4% yield5% yield6% yield8% yield
$100$60,000$40,000$30,000$24,000$20,000$15,000
$500$300,000$200,000$150,000$120,000$100,000$75,000
$1,000$600,000$400,000$300,000$240,000$200,000$150,000
$2,000$1,200,000$800,000$600,000$480,000$400,000$300,000
$3,000$1,800,000$1,200,000$900,000$720,000$600,000$450,000
$5,000$3,000,000$2,000,000$1,500,000$1,200,000$1,000,000$750,000

Tax raises the amount. At a 4% yield and a 15% tax, $1,000 a month takes $352,941.

Made-up example. This is plain math, not a forecast. You can also build up to it. This table shows the years until dividends reach $1,000 a month. It uses a 4% yield, paid each quarter and reinvested, with no growth and no tax.

Start withAdd $250 a monthAdd $500 a monthAdd $1,000 a monthAdd $2,000 a month
$041281811
$10,00038271711
$50,0002921149
$100,0002016117

To test your own goal, open Growth, tax and extras in the calculator. Type a monthly income goal. The result shows the money needed today and the year your plan gets there.

Test how long your savings could last with the retirement calculator →

Work out a number to live on with the FIRE calculator →

Prices rise over time, so $1,000 buys less later. To see a future amount in today’s dollars, take inflation out.

Vtoday=V(1+i)TV_{\text{today}} = \dfrac{V}{(1+i)^{T}}

In words: Divide by one plus inflation, once for each year.

VtodayV_{\text{today}}
the value in today’s dollars
VV
the value at the end
ii
how fast prices rise each year, as a decimal
TT
the number of years

See what your money is worth in today’s dollars with the investment calculator →

How much does $10,000, $100,000 or $1 million pay in dividends?

It depends on the yield. Multiply the amount by the yield to get a year of dividends. At a 3% yield, $10,000 pays $300 a year, $100,000 pays $3,000 and $1 million pays $30,000. At 5%, the same amounts pay $500, $5,000 and $50,000. Tax comes out of that.

Made-up example. This is plain math, not a forecast. This is a year of dividends, before tax.

Amount1% yield2% yield3% yield4% yield5% yield6% yield8% yield
$1,000$10$20$30$40$50$60$80
$10,000$100$200$300$400$500$600$800
$50,000$500$1,000$1,500$2,000$2,500$3,000$4,000
$100,000$1,000$2,000$3,000$4,000$5,000$6,000$8,000
$250,000$2,500$5,000$7,500$10,000$12,500$15,000$20,000
$500,000$5,000$10,000$15,000$20,000$25,000$30,000$40,000
$1,000,000$10,000$20,000$30,000$40,000$50,000$60,000$80,000

Here are the same dividends as a monthly average.

Amount1% yield2% yield3% yield4% yield5% yield6% yield8% yield
$10,000$8$17$25$33$42$50$67
$50,000$42$83$125$167$208$250$333
$100,000$83$167$250$333$417$500$667
$250,000$208$417$625$833$1,042$1,250$1,667
$500,000$417$833$1,250$1,667$2,083$2,500$3,333
$1,000,000$833$1,667$2,500$3,333$4,167$5,000$6,667

Both tables are the amount times the yield. They do not say what any share will pay.

Grow a fixed monthly sum at one rate with the future value calculator →

Dividend growth and yield on cost

Yield on cost is this year’s dividend per share divided by the price you paid, not today’s price. If you paid $40 a share and it now pays $3.20 a year, your yield on cost is 8%. It rises only when the dividend is raised. A cut makes it fall.

YOCt=Dtp0=y (1+g)t−1\text{YOC}_t = \dfrac{D_t}{p_0} = y\,(1+g)^{t-1}

In words: Divide this year’s dividend per share by the price you paid.

YOCt\text{YOC}_t
your yield on cost in year t
DtD_t
the yearly dividend per share in year t
p0p_0
the price you paid
yy
the yield on the day you bought, as a decimal
gg
how fast the dividend grows each year, as a decimal

Made-up example. This is plain math, not a forecast. These are the years for yield on cost to double when the dividend rises by the same share each year.

Dividend growth a yearYears to double
2%35.0
3%23.4
5%14.2
7%10.2
10%7.3

How fast a dividend grew between two years is a CAGR. A dividend that goes from $1.00 to $1.50 over 6 years grew 6.99% a year.

Turn two dividend amounts into one yearly rate with the CAGR calculator →

Growth numbers must fit each other. Say the dividend grows faster than the price for years. Then the yield a new buyer gets keeps climbing.

yt=y(1+g1+a)ty_t = y\left(\dfrac{1+g}{1+a}\right)^{t}

In words: If the dividend grows faster than the price, a new buyer’s yield climbs each year.

yty_t
the yield a new buyer gets after t years
yy
the yield today, as a decimal
gg
how fast the dividend grows each year, as a decimal
aa
how fast the share price grows each year, as a decimal

Made-up example. This is plain math, not a forecast. A 3% yield after years of typed growth. The first number is dividend growth and the second is price growth.

Dividend growth and price growthAfter 10 yearsAfter 20 yearsAfter 30 yearsAfter 40 years
5% and 5%3.0%3.0%3.0%3.0%
5% and 3%3.6%4.4%5.3%6.5%
7% and 3%4.4%6.4%9.4%13.8%
10% and 5%4.8%7.6%12.1%19.3%
10% and 3%5.8%11.2%21.6%41.6%
3% and 7%2.0%1.4%1.0%0.7%

Two growth numbers that are far apart push the yield to a level that makes little sense. The calculator warns you when that happens.

Made-up example. This is plain math, not a forecast. How many years of cash dividends add up to what you paid? These are years, before tax.

YieldNo growth3% growth5% growth7% growth10% growth
2%50.031.025.722.218.8
3%33.323.420.117.815.4
4%25.018.916.615.013.1
5%20.015.914.212.911.5
6%16.713.712.411.410.3
8%12.510.810.09.38.5
T=ln⁡(1+g/y)ln⁡(1+g)T = \dfrac{\ln\left(1 + g/y\right)}{\ln(1+g)}

In words: This gives the years of cash dividends that add up to what you paid. With no growth, it is 1 divided by the yield.

TT
the years to get your money back
gg
how fast the dividend grows each year, as a decimal
yy
the dividend yield, as a decimal

High yield or fast growth: when does the smaller dividend catch up?

A lower yield that grows faster can pass a higher yield, but it takes years. In a made-up case, 3% growing 6% a year passes 5% growing 2% in year 15. Its total income catches up in year 24. No one knows how fast a dividend will grow.

t∗=ln⁡(yA/yB)ln⁡(1+gB1+gA)t^{*} = \dfrac{\ln\left(y_A / y_B\right)}{\ln\left(\dfrac{1+g_B}{1+g_A}\right)}

In words: Count the yearly raises B needs to pass A. Round down and add 2 to get the year B first pays more.

t∗t^{*}
the number of yearly raises
yAy_A
the yield A starts with
yBy_B
the yield B starts with
gAg_A
how fast A’s dividend grows each year
gBg_B
how fast B’s dividend grows each year

Made-up example. This is plain math, not a forecast. The same money goes into A and into B, and every dividend is taken as cash.

A against B (yield, then yearly growth)Year B’s yearly income passes AYear B’s total income passes A
5% growing 2% against 3% growing 6%1524
5% growing 2% against 3% growing 8%1017
5% growing 2% against 2% growing 8%1828
6% growing 0% against 3% growing 5%1627
6% growing 0% against 2% growing 10%1321
8% growing 0% against 2% growing 10%1626
4% growing 3% against 2% growing 7%2031
4% growing 3% against 2% growing 10%1219

To run your own test, turn on Compare with a second set in the calculator. Then type the yield and the growth for B.

A growth rate is a guess, and one cut resets the count. Neither set is the better one.

Monthly or quarterly dividends: does it matter when you get paid?

Only a little. At the same yield, monthly payments get reinvested sooner than quarterly ones. In a made-up example, $10,000 at 4% for 30 years reaches $33,135 paid monthly and $33,004 paid quarterly. That is a gap of 0.4%. The yield and the years matter far more.

Made-up example. This is plain math, not a forecast. You start with $10,000 and reinvest each payment, with no growth. The last two columns show how far monthly ends ahead.

Yield and yearsYearlyTwice a yearQuarterlyMonthlyMonthly over yearlyMonthly over quarterly
4% for 10 years$14,802$14,859$14,889$14,9080.72%0.13%
4% for 20 years$21,911$22,080$22,167$22,2261.44%0.26%
4% for 30 years$32,434$32,810$33,004$33,1352.16%0.40%
4% for 40 years$48,010$48,754$49,138$49,3992.89%0.53%
8% for 10 years$21,589$21,911$22,080$22,1962.81%0.53%
8% for 20 years$46,610$48,010$48,754$49,2685.70%1.05%
8% for 30 years$100,627$105,196$107,652$109,3578.68%1.58%
8% for 40 years$217,245$230,498$237,699$242,73411.73%2.12%

If you take the cash, the yearly total is the same on any schedule. Only the dates change.

The SEC notes that companies that pay dividends usually keep a fixed schedule. They can also pay one at any time.

See if it helps to be paid more often with the compound interest calculator →

A credit union calls the money it pays on savings a dividend. The IRS treats it as interest.

See what a bank or credit union pays you with the high-yield savings calculator →

Work out interest on a fixed term with the CD calculator →

How are dividends taxed?

In a taxable account, dividends are taxed in the year they are paid, even if you reinvest them. The IRS treats them as ordinary dividends. Some are qualified: they meet IRS rules, such as a holding rule, and get a lower rate of 0%, 15% or 20%. The rest are taxed at your regular rate.

Qualified dividends are taxed at the capital gain rates. For tax year 2025, the IRS lists these. Each cell is the top taxable income for that rate.

Tax rate on qualified dividendsSingleMarried filing jointlyHead of household
0%Up to $48,350Up to $96,700Up to $64,750
15%Up to $533,400Up to $600,050Up to $566,700
20%Above thatAbove thatAbove that
  • Some people pay 3.8% more. This is the net investment income tax. For single filers and heads of household, the line is $200,000 of modified adjusted gross income. For married couples filing jointly, it is $250,000.
  • The holding rule: you must hold the stock for more than 60 days. Those days must fall in the 121 days that begin 60 days before the ex-dividend date.
  • Each payer sends you Form 1099-DIV when it pays you at least $10 in a year.

Made-up example. This is plain math, not a forecast. You start with $50,000 at a 4% yield, paid each quarter and reinvested, with no growth. The gap is how far each row ends behind the 0% row. The last row adds the 3.8% tax to the 20% rate.

Tax on dividendsYield after taxValue in 10 yearsGap in 10 yearsValue in 20 yearsGap in 20 yearsValue in 30 yearsGap in 30 years
0%4.00%$74,443$0$110,836$0$165,019$0
15%3.40%$70,147$4,296$98,411$12,425$138,063$26,956
20%3.20%$68,769$5,674$94,583$16,253$130,087$34,932
23.8%3.05%$67,739$6,704$91,772$19,064$124,332$40,687

Inside a traditional IRA, earnings are not taxed until you take money out, the IRS says.

Plan what you save and spend with the retirement calculator →

This page gives general facts, not tax advice.

Ex-dividend date, record date and payment date

To get a dividend, you must buy the stock before its ex-dividend date. Buy on that date or later, and the seller gets the payment. The SEC says the ex-dividend date is usually the record date. If the record date is not a business day, it is one business day earlier.

DateWhat happens
Declaration dateThe company says it will pay a dividend
Ex-dividend dateThe first day a new buyer does not get it
Record dateYou must be on the company’s books by this day
Payment dateThe cash arrives

Why do the two dates now match? Since May 28, 2024, most stock trades settle in one business day.

With a significant dividend, the SEC notes, the price of a stock may fall by that amount. That happens on the ex-dividend date.

This tool does not look at dates. It assumes you hold the shares all year.

Can I use this as an ETF or fund dividend calculator?

Yes, it works for any fund. A fund passes the dividends from the stocks it holds on to you. Look up three numbers on the fund’s own page. They are its share price, what it paid per share over the last 12 months, and how many times a year it pays. Type them in.

  1. Switch Start with to Shares.
  2. Type your shares and the share price.
  3. Pick Dollars per share and type what the fund paid.
  4. Pick how often it pays. The calculator shows the yield as price math.

A fund’s payout can hold more than dividends. It may hold capital gain distributions too. It may also hold a return of capital. The IRS says a return of capital is not a dividend. Type only the dividend part.

A fund takes its fees out before it pays you.

See how fees cut into growth with the investment calculator →

This calculator holds no prices or payouts for any fund, and it names none.

See what the index did in the past with the S&P 500 calculator →

What this dividend calculator leaves out

This is math on the numbers you type, not a forecast. FINRA, which sets rules for brokers, says a company can cut a dividend or end it. Share prices can fall too. The calculator leaves out fees and trading costs. It assumes every dividend is paid on time and reinvested at that day’s price.

  • Growth is smooth, the same each year.
  • The dividend steps up once a year.
  • Shares can be bought in fractions.
  • Tax is one flat rate.
  • Cash dividends earn nothing.
  • Money is added on the first of each month.
dj=D0m (1+g)⌊(j−1)/m⌋pj=p0 (1+a)j/md_j = \dfrac{D_0}{m}\,(1+g)^{\lfloor (j-1)/m \rfloor} \qquad p_j = p_0\,(1+a)^{j/m}

In words: The dividend steps up once a year. The price grows a little each period.

djd_j
the dividend per share at payment j
pjp_j
the share price at payment j
D0D_0
the yearly dividend per share at the start
p0p_0
the share price at the start
gg
how fast the dividend grows each year, as a decimal
aa
how fast the share price grows each year, as a decimal
mm
the payments in a year

Real years are not smooth. The bad-year test cuts the dividend, drops the price, or both, in a year you pick.

Dt=D0 (1+g)t−1 (1−κ)[t≥c]D_t = D_0\,(1+g)^{t-1}\,(1-\kappa)^{[t \ge c]}

In words: A cut lowers the dividend in its year and every year after.

DtD_t
the yearly dividend per share in year t
D0D_0
the yearly dividend per share at the start
gg
how fast the dividend grows each year, as a decimal
κ\kappa
the size of the cut, as a decimal
cc
the year of the cut

Made-up example. This is plain math, not a forecast. One bad year with no growth typed. You start with $20,000 at a 4% yield, paid each quarter and reinvested for 20 years.

CaseYear 6 incomeYear 20 incomeTotal dividendsEnd value
No bad year$991$1,730$24,334$44,334
Dividend cut 50% in year 6$492$650$12,917$32,917
Price falls 30% in year 6$997$2,207$27,332$40,011
Both in year 6$493$735$13,504$26,183

A cut halves the income for good. A price fall lowers the value. But each reinvested dividend then buys more shares, as long as the dividend is still paid.

You can lose money.

Questions people ask

What is a dividend?

A dividend is a part of a company’s profit paid to the people who own its shares. Most are paid in cash on a set schedule. A company does not have to pay one, and it can cut it or stop it.

How often are dividends paid?

It depends on the company or fund. Common schedules are every three months, every month, twice a year and once a year. The SEC notes that companies usually keep a fixed schedule but can pay at any time.

Is a higher dividend yield better?

Not always. Yield is the dividend divided by the price, so it rises when the price falls, even though you are paid the same. It shows what is paid now. It does not show whether the payment will last.

Are reinvested dividends taxed?

Yes, in a taxable account. The IRS says that if you use dividends to buy more stock, you must still report them as income. The amount you reinvest becomes the cost of the new shares, which matters when you sell. Inside a traditional IRA, earnings are not taxed until you take money out.

Is reinvesting dividends (DRIP) worth it?

It depends on whether you need the cash. Reinvesting buys more shares, so later payments are larger if the dividend holds. Taking cash gives you money to spend now. Reinvesting also puts more of your money into one holding, and the tax is due either way.

Does the share price drop when a dividend is paid?

It can. With a significant dividend, the SEC notes, the price may fall by that amount. This happens on the ex-dividend date, when a new buyer no longer gets that payment. This calculator does not model that drop.

Are credit union dividends the same as stock dividends?

No. Credit unions call the money they pay on savings a dividend, but the IRS treats it as interest. For that kind of account, use our savings or CD calculator. This page is for dividends paid on shares of a company or fund.

How long until dividends pay back what I paid?

Divide 1 by the yield. At a 4% yield with no growth, cash dividends add up to what you paid after 25 years, before tax. At 5% it takes 20 years. A growing dividend shortens the wait, and a cut makes it longer.

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Reviewed by Tavish Sharma, CFA · Last reviewed

Published by Amaltash Advisors LLC, an SEC-registered investment adviser

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