DRIP Calculator

Project share count and portfolio value with dividends reinvested versus taken as cash.

Reinvesting dividends over 10 years grows your position to $13,975.11, a 179.5% total return.

Total Value

$13,975.11

Final Shares

142.08

Total Dividends Received

$3,060.18

Total Return

179.5%

DRIP Advantage

$1,623.78

Dividends ReinvestedDividends Taken as Cash (+ balance)

Estimates only, not financial, tax, or legal advice. See our Terms and Privacy Policy.

A dividend reinvestment plan (DRIP) automatically uses each dividend payment to buy more shares instead of paying it out as cash. Over long periods, those extra shares compound: each new share earns its own dividends, which buy still more shares, on top of whatever price appreciation the stock itself delivers.

This calculator projects both paths (reinvesting versus taking dividends as cash) side by side, so you can see exactly how much of a long-term difference reinvestment makes.

How does this calculator work?

Enter your starting share count and price, the stock's current annual dividend per share, and your assumptions for how fast that dividend and the share price will grow each year.

Choose whether to reinvest dividends or take them as cash, and set the number of years to project.

The calculator simulates dividend payments quarterly (the typical payment schedule), growing the dividend year over year and either buying additional shares with it or setting it aside as cash, then compares the two paths.

Reinvesting turns a stock's dividend yield into a compounding machine: each payment buys shares that pay their own dividends, the same compound growth that drives long-run investing. Over a full holding period the reinvested path is best judged by its total return and annualized growth, and the pattern of steady reinvested contributions mirrors the math of a regular savings stream.

Worked example

100 shares at $50, a current $2.00 annual dividend per share, growing 5% a year, with 7% annual price appreciation, over 10 years.

Final shares (reinvested): 142.08
Final portfolio value (reinvested): $13,975
Total dividends received: $3,060
Total return (reinvested): 179.5%

How the numbers work

Reinvesting grows the share count from 100 to about 142 over 10 years, entirely from dividends buying additional shares each quarter, on top of the stock's own price growth.

Compare that to taking the same dividends as cash: the share count stays at 100, the stock still appreciates to the same price, but the accumulated cash sits separately rather than compounding into more shares, typically leaving a lower combined total than the reinvested path over long horizons.

Reinvestment doesn't change what a company pays out. It changes what you do with it, and letting dividends buy more shares (which then earn their own dividends) is what creates the extra compounding, particularly powerful over long holding periods when share counts have decades to grow.

DRIP Calculator glossary

DRIP (Dividend Reinvestment Plan): A program, offered by many brokers and companies directly, that automatically uses dividend payments to purchase additional shares rather than distributing cash.
Dividend Growth Rate: The annual rate at which a company's dividend per share is assumed to increase, distinct from the stock's price growth rate.
Compounding Shares: The effect where reinvested dividends buy additional shares that then generate their own dividends in future periods, compounding the share count over time.

DRIP Calculator FAQs

Does reinvesting dividends avoid taxes?+

No, in a standard taxable brokerage account, dividends are generally taxable in the year received whether or not you reinvest them. DRIPs held in tax-advantaged accounts like IRAs can defer or avoid that tax, depending on the account type.

Why simulate quarterly rather than annually?+

Most U.S. stocks pay dividends quarterly, so simulating at that cadence more accurately captures how often new shares are purchased and start compounding, compared to a simpler once-a-year approximation.

What if the stock cuts its dividend?+

This calculator assumes steady dividend growth at the rate you enter. Real dividends can be cut, frozen, or grown faster than projected, so treat the dividend growth assumption as a scenario, not a guarantee, and consider testing a more conservative growth rate.

Is reinvesting always better than taking cash?+

For long-term, buy-and-hold investors who don't need the income, reinvestment typically produces a higher total value over time due to compounding. But taking dividends as cash may better suit investors who rely on that income for living expenses or want to redeploy it elsewhere.