Dividend Reinvestment Calculator (DRIP)

Use our free dividend reinvestment calculator to see how reinvesting dividends can dramatically boost your long-term returns. Compare the growth of an investment with and without dividend reinvestment (DRIP).

Financial

Currency

Initial Investment

Annual Dividend Yield (%)

Annual Price Growth (%)

Time Period (years)

years

Dividend Frequency

Formula

Dividend reinvestment (DRIP) is a strategy where dividends received are used to purchase additional shares, compounding your returns over time. This calculator shows the powerful effect of DRIP compared to simply taking dividends as cash.

FV with DRIP = PV Ã— (1 + (Yield + Growth)/n)^(nÃ—t)

Percentage: The percentage value you want to apply

Number: The original number or value

Result: The calculated result

How It Works

1Enter your initial investment amount.
2Set the dividend yield and expected annual price growth.
3Choose the dividend payment frequency.
4See the dramatic difference DRIP makes over time.

Examples

$10,000 with 3% dividend yield + 7% growth for 10 years

1.Total return with DRIP = 3% + 7% = 10% compounded
2.Future value â‰ˆ $10,000 Ã— (1.025)^40 = $26,850
3.Without DRIP: $10,000 Ã— (1.07)^10 = $19,670

Result: $26,850

Frequently Asked Questions

A DRIP (Dividend Reinvestment Plan) automatically uses dividends to purchase additional shares of the stock, allowing your investment to compound over time.

DRIP can significantly boost long-term returns. Over 20-30 years, reinvesting dividends can account for 40% or more of total returns in a typical stock market investment.

In most countries, reinvested dividends are still taxable as income in the year they are received, even though you don't receive cash. Check your local tax laws.

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DRIP Investing Guide

CalculateMe Team

Last updated: 2026-07-15

Frequently Asked Questions

A DRIP (Dividend Reinvestment Plan) automatically uses dividends to purchase additional shares of the stock, allowing your investment to compound over time.

DRIP can significantly boost long-term returns. Over 20-30 years, reinvesting dividends can account for 40% or more of total returns in a typical stock market investment.

In most countries, reinvested dividends are still taxable as income in the year they are received, even though you don't receive cash. Check your local tax laws.

Dividend Reinvestment Calculator (DRIP)

Formula

How It Works

Examples

$10,000 with 3% dividend yield + 7% growth for 10 years

Frequently Asked Questions

What is a DRIP?

How much does DRIP add to returns?

Are DRIPs tax efficient?

Related Calculators

Related Articles

Dividend Reinvestment Calculator (DRIP)

Formula

How It Works

Examples

$10,000 with 3% dividend yield + 7% growth for 10 years

Frequently Asked Questions

What is a DRIP?

How much does DRIP add to returns?

Are DRIPs tax efficient?

Related Calculators

Related Articles