Dividend reinvestment
Compare reinvesting dividends with taking them as cash over the years.
Dividend reinvestment
Reinvesting dividends buys more shares, which pay their own dividends — compounding through the payout. Compare that with pocketing the dividends as cash. Every input here is a hypothetical you choose.
$
%
%
%
Reinvested, 25 yrs
$51,963
Dividends taken as cash
$35,256
Reinvesting adds
$16,707
“Cash taken” counts the dividends you pocketed plus the shares you kept. This ignores taxes, which can differ between reinvesting and taking cash. A dividend is never promised — a company can cut it.
This is a hypothetical illustration, not advice or a prediction. The numbers are made up to show how the math works — real returns vary and can be negative. See the full disclaimer.