Dividend Reinvestment Calculator: DRIP vs Cash

Track every dividend, contribution, purchase fee, withheld amount and residual cash in two comparable scenarios.

Your inputs

Use consistent units and periods. Defaults are examples.

Starting sharesStarting price per shareStarting annual dividend per shareAnnual total per share, even if payments are quarterly or monthly.Dividend and purchase events per yearWhole years to modelMonthly contribution budgetGrouped into the dividend event, then invested after that dividend is calculated.Annual growth of dividend per share (%)Independent of price growth. These are scenario assumptions, not expected market returns.Annual share-price growth (%)Withholding deducted from each dividend (%)Share of net dividends available to reinvest (%)Purchase precisionFee per executed combined purchaseOne fee for the combined contribution/reinvestment purchase at an event. No fee if no purchase executes.

Your result

Check the assumptions below before relying on a result.

Formula and method

At event k of f events/year, gross dividend = opening shares × initial annual dividend × (1 + dividend growth)^((k−1)/f) ÷ f. Deduct entered withholding. Pool the chosen reinvestment share, contribution budget × 12/f and previous purchase residual. Buy at initial price × (1 + price growth)^(k/f), after one fee if a purchase executes. Ending wealth = shares × price + all cash. Compare the same model with reinvestment set to zero.

Worked example

With 100 shares at 100, an annual dividend of 4, one annual event, no contributions, fees, tax or growth, DRIP buys four shares. Ending wealth is 10,400. After two annual events, shares are 108.16 and wealth 10,816. Holding dividends as cash instead leaves 100 shares plus 800 cash, or 10,800.

What this model leaves out

This is an event-based scenario, not an issuer-specific ex-dividend calendar. Shares bought after an event receive dividends only in later events. Monthly contributions are grouped into each payment event; quarterly means three monthly budgets contributed at quarter end. Dividends per share follow the period-opening time while purchase prices follow the event-ending time. Non-reinvested cash earns no interest and is retained; it is not withdrawn. Purchase residuals carry forward, separately from cash income. A fee is charged only if at least one permitted share amount can be purchased. The model excludes sales, capital-gains tax, splits, special distributions and changes in payment dates.

Reference and further reading

Investor.gov: direct investing and dividend reinvestment

Reference checked 2026-10-16. AllMarkets implements its own calculation; the linked publisher does not endorse this tool.

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How to use this result

Start with annual dividend per share, initial shares and price.
Set the event frequency to match the simplified timing you want to model.
Change dividend growth and price growth separately; test a downside scenario too.
Compare ending wealth, not just share count, against the cash-dividend scenario.
Download the CSV to audit every payment and purchase event, including residual cash.

Questions about this calculation

Why does the cash scenario still buy shares?

Both scenarios invest the same external contributions. Only the treatment of dividend cash differs.

Are reinvested dividends counted as new contributions?

No. External contributions are the money added from outside; reinvested dividends are internally generated cash.

Can fees make reinvestment worse?

Yes. A purchase fee can outweigh a small distribution. The comparison reports the result rather than assuming DRIP always wins.

What happens when a whole share cannot be bought?

The purchase pool is retained as residual cash and joins the next event. Cash deliberately excluded from reinvestment stays outside that pool.

Continue your calculation

Compare, save and share a scenario

Use two independent sets of inputs and inspect what changes the result. Saving is optional and stays in this browser. Scenario links include your numeric inputs and valid extra-payment schedules; use illustrative data when sharing.