Free Dividend Reinvestment (DRIP) Calculator
Calculate how reinvesting dividends accelerates wealth building through compound growth over time.
USD
%
%
years
With DRIP (Reinvested)
$46,610
Without DRIP (Price Only)$26,533
DRIP Advantage$20,077
Cumulative Dividends Earned$20,077
With DRIP (Reinvested) vs Investment Period
Dividend Reinvestment Plans (DRIP)
A DRIP automatically uses dividend payments to purchase additional shares, creating a compounding effect.
How Compounding Amplifies Returns
Formula
With DRIP = Investment x (1 + Yield + Growth)^Years
Without DRIP = Investment x (1 + Growth)^Years
The difference widens dramatically over longer time periods.
Example Calculation
$10,000 invested in a stock with 3% dividend yield and 5% price growth for 20 years.
- 01Total return with DRIP = 3% + 5% = 8%
- 02With DRIP: $10,000 x (1.08)^20 = $46,610
- 03Without DRIP: $10,000 x (1.05)^20 = $26,533
- 04DRIP advantage = $46,610 - $26,533 = $20,077
- 05Reinvesting dividends nearly doubled the investment outcome
Frequently Asked Questions
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