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Dividend Income Calculator

Calculate passive income from dividend stocks

Understanding Dividend Investing

Dividend investing focuses on stocks that pay regular cash distributions to shareholders. Many investors use dividends to generate passive income.

Example: $100,000 invested at 4% dividend yield

Annual dividend income: $100,000 × 4% = $4,000
Monthly income: $4,000 ÷ 12 = $333

Dividend yields vary by company and sector. Utilities and REITs typically offer higher yields (4-6%), while growth stocks offer lower yields (0-2%).

Reinvesting vs Taking Cash

Scenario: $100,000 invested at 4% yield with 5% annual dividend growth for 20 years.

Take Cash Income

Portfolio stays at $100,000
Year 1 income: $4,000
Year 20 income: $10,628
Total income: $145,000

Reinvest Dividends

Portfolio grows to $265,330
Year 1 income: $4,000
Year 20 income: $28,200
Total value: $265,330

Reinvesting dividends can significantly accelerate wealth building, especially over long periods. Many investors reinvest during accumulation phase, then take cash in retirement.

Popular Dividend Yields by Sector

REITs (Real Estate): 4-7%
Utilities: 3-5%
Consumer Staples: 2-4%
Financials: 2-4%
Technology: 0-2%

These are typical ranges. Individual stocks vary. Higher yields may indicate higher risk. For educational purposes only.

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