DRIP Future Value Calculator

Project the future value of a share holding when dividends are reinvested, from your initial shares, price, yield, and growth.

Inputs

Number of shares you start with.

Current price per share.

Annual dividend as a percent of price.

Expected annual share-price appreciation.

Holding period.

Result

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How to use this calculator

  • Enter your initial number of shares and the share price.
  • Enter the dividend yield and expected annual price growth.
  • Enter the holding period in years.
  • Compare the future value with DRIP against taking dividends as cash.

About this calculator

This calculator projects what a stock or fund holding grows to when you automatically reinvest its dividends (a DRIP). You start with a number of shares at a given price; each year the position appreciates at the price-growth rate and pays a dividend equal to the yield, which buys more shares. Because those new shares then earn their own growth and dividends, the value compounds at roughly the sum of the price-growth and dividend-yield rates — the engine behind long-run equity returns. The tool contrasts that with taking dividends as cash, where only the share price compounds and the dividends accumulate un-grown. Over decades the difference can be large. The model assumes constant rates for clarity and shows results pre-tax; in a taxable account, reinvested dividends are still taxed in the year they are paid.

How it works — the formula

Initial = Shares × Price With DRIP = Initial × (1 + growth + yield)^years Without = Initial × (1 + growth)^years + Σ yield·Initial·(1+growth)^i

Reinvestment compounds growth and yield together; taking cash compounds only price and leaves dividends un-grown.

Source: SEC Investor.gov — DRIP

Worked examples

Example 1
100 sh × $100, 3% yield, 6% growth, 20 yr
Inputs:
shares=100, price=100, yield=3, growth=6, years=20
Output:
with DRIP ≈ $56,044
Example 2
50 sh × $200, 4% yield, 5% growth, 25 yr
Inputs:
shares=50, price=200, yield=4, growth=5, years=25
Output:
with DRIP ≈ $66,000+
Example 3
100 sh × $50, 0% yield, 7% growth, 30 yr
Inputs:
shares=100, price=50, yield=0, growth=7, years=30
Output:
DRIP = price-only ≈ $38,061

Limitations

  • Constant yield and growth assumed; reality varies.
  • Pre-tax; taxable accounts owe tax on reinvested dividends.
  • Annual-compounding approximation.

Illustrative projection, not investment advice.

Frequently asked

How does reinvesting dividends grow my money faster?+
Each reinvested dividend buys more shares, which then earn their own dividends and price gains. This compounding means the value grows at about the price-growth rate plus the dividend yield, rather than price growth alone.
What is the difference from taking dividends as cash?+
If you take dividends as cash, only your share price compounds and the dividends sit idle (un-grown). Reinvesting puts every dividend back to work immediately, which over long periods produces a meaningfully larger ending balance.
Is the total return just growth plus yield?+
Approximately, when dividends are reinvested. The position compounds at roughly (1 + price growth + yield) per year. The exact figure depends on dividend timing and the price at each reinvestment, which this model simplifies to annual compounding.
Are reinvested dividends taxed?+
In a taxable account, yes — they are taxable income in the year paid, even though you receive no cash. In tax-advantaged accounts (IRA, 401(k)) reinvestment grows tax-deferred or tax-free.
How is this different from the other DRIP calculator?+
This one starts from a share count and price (handy if you think in shares), while the other starts from a dollar amount. Both use the same total-return compounding model and produce equivalent results for the same initial value.
Does it assume constant returns?+
Yes, for clarity it uses fixed price-growth and yield each year. Real returns vary, dividends can be cut or raised, and yields fluctuate with price, so treat the projection as illustrative rather than a forecast.

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