Dividend Reinvestment Calculator: Compound Your Wealth
Our DRIP Calculator shows how reinvesting dividends buys more shares, compounding growth exponentially.
What is Dividend Reinvestment (DRIP)?
Automatically using dividends to purchase additional shares, harnessing compounding.
Key Benefits
- Compounds returns
- No brokerage fees in many plans
- Dollar-cost averaging
- Long-term wealth building
DRIP vs Cash Dividends
| Strategy | Growth | Income |
|---|---|---|
| DRIP | Higher total value | Deferred |
| Cash | Lower growth | Immediate |
Example: 100 Shares @ $50, $2 Dividend (5% growth), 7% Price Growth, Quarterly, 20 Years
- DRIP Value: $28,945
- Shares: 295
- Without DRIP: $19,218
- Advantage: $9,727
How It's Calculated
Each period: Dividend = shares × div_per_share; New shares = dividend / price; Update shares, price, div.
Why Use DRIP?
- Historical outperformance
- Tax-deferred in accounts
- Link to Compound Interest
Pro Tips
- Choose dividend growers
- Enroll in company DRIP
- Reinvest consistently
- Monitor yield on cost
Limitations
- Assumes constant growth
- No taxes/fees
- Fractional shares
- Market volatility
Conclusion
Supercharge investments with our Dividend Reinvestment Calculator. Explore Finance tools.