DRIP Calculator

See how reinvesting dividends accelerates your wealth over time.

Initial Investment

Share Price

Annual Dividend Yield

Annual Dividend Growth Rate

Expected Annual Price Appreciation

Time Period (Years)

Additional Monthly Investment

Dividend Frequency

With DRIP

Without DRIP

DRIP Advantage

Annual Dividend Income

At end of period

Starting Shares

Ending Shares (DRIP)

Total Dividends Earned

DRIP vs. No DRIP Growth

Year-by-Year Breakdown

Year	Share Price	Shares (DRIP)	Dividends	With DRIP	Without DRIP

What Is DRIP?

A Dividend Reinvestment Plan (DRIP) automatically uses your dividend payments to purchase additional shares of the same stock. Instead of receiving cash, you accumulate more shares — which in turn generate their own dividends, creating a powerful compounding snowball effect.

The magic of DRIP is most visible over long time horizons. With each dividend payment buying more shares, your share count grows exponentially. Those additional shares earn their own dividends, which buy even more shares, and so on.

Companies with a history of growing their dividends (known as "Dividend Aristocrats") amplify the DRIP effect further. When both your share count and the per-share dividend are increasing, your income stream can grow dramatically over decades.

Frequently Asked Questions

What is a DRIP?

A dividend reinvestment plan (DRIP) automatically uses the cash dividends a stock or fund pays to buy more shares, instead of paying the dividend to you as cash. Over time this steadily increases your share count, which in turn increases future dividends.

How does reinvesting dividends accelerate growth?

Reinvested dividends buy additional shares that themselves pay dividends, creating a compounding effect. Historically, reinvested dividends have accounted for a large share of the stock market's total long-term return.

Are reinvested dividends taxed?

Yes. In a taxable account, dividends are generally taxable in the year they are paid, even if you reinvest them. In tax-advantaged accounts such as IRAs, reinvested dividends grow tax-deferred, or tax-free in the case of a Roth account.

Is a DRIP always better than taking cash?

Not necessarily. Reinvesting maximizes long-term compounding, but if you need income, want to rebalance your portfolio, or believe a stock is overvalued, taking dividends as cash can be the better choice.

All tools Compound interest Retirement calculator Stock directory