Reinvestment Rate Calculator ๐
Estimate the **future value** of an investment assuming that all generated interest, dividends, or coupon payments are **fully reinvested** at the investment's return rate.
The Power of Reinvestment
When dividends or interest payments are **reinvested**, the investment benefits from **compounding**. This calculator uses the standard Compound Interest formula to show the exponential growth achieved when earnings themselves start earning a return.
Formula Used (Compound Interest)
FV = P ร (1 + r/n)โฟแต
Where:
FV = Future Value
P = Initial Principal
r = Annual Interest Rate (as a decimal)
n = Compounding Frequency per year
t = Number of Years
The "reinvestment rate" is implicitly assumed to be equal to the **annual return rate (r)**, which is the standard assumption for conservative future value projections.