Two honest ways to count dividend income
If you hold a fund or a whole portfolio, the natural inputs are value and yield — $25,000 at a 4% yield pays $1,000 a year, about $83 a month. If you hold a specific stock, you likely know the declared payout instead: shares × dividend per share × payments per year. Both routes land on the same number; this calculator supports either and, in per-share mode, derives the yield for you when you add the share price — useful for spotting whether a payout is generous or just a depressed price in disguise.
Why the growth rate is the interesting input
Today’s yield understates what dividend investing actually does. Established dividend growers routinely raise payouts 5–10% a year, which means the income — not the stock price — compounds: a $1,000 annual income growing 7% becomes roughly $1,970 in year 10 and $3,870 in year 20 without you adding a cent. That growing stream is measured against your original cost, which is why long-term holders talk about “yield on cost” far higher than any quoted yield. The projection table shows this trajectory conservatively: growth of the payout only, with no reinvestment and no new contributions.
What this doesn’t promise
Dividends aren’t contractual. Companies cut them in hard times — and an unusually high yield is often the market pricing in exactly that risk. Payouts are also typically taxable in the year received. Treat the output as a planning estimate for a sustainable payer, not a guarantee. To model reinvesting the dividends together with regular contributions — where compounding really accelerates — continue in the investment growth calculator, or check a position’s total return including dividends in the stock profit calculator.