Basic Settings
Returns & Dividends
Automatically reinvest dividends after tax
Tax & Adjustments
Investment Goal
$0.00
Total Invested: $0.00
$0.00
Return Rate: +0.0%
$0.00
Total Dividends: $0.00
Year-by-Year Breakdown
| Year | Starting Balance | Contributions | Capital Gains | Dividends | Ending Balance |
|---|---|---|---|---|---|
| 1 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 2 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 3 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 4 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 5 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 6 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 7 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 8 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 9 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 10 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 11 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 12 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 13 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 14 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 15 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 16 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 17 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 18 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 19 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
| 20 | $0.00 | $0.00 | $0.00 | $0.00 | $0.00 |
The Power of Compound Interest & Dividend Reinvestment
What Is Compound Interest?
Compound interest is the process of earning interest not only on your original principal but also on the accumulated interest from previous periods. Often attributed to Einstein as the "eighth wonder of the world," compound interest is the key driver of long-term wealth building. The longer your investment horizon, the more dramatic the compounding effect becomes.
The Power of DRIP (Dividend Reinvestment Plan)
A Dividend Reinvestment Plan (DRIP) automatically reinvests your cash dividends back into additional shares of the underlying stock or fund. Instead of spending your dividends, reinvesting them increases your share count over time, which in turn generates even more dividends. This "compounding of dividends" can significantly accelerate your portfolio growth over the long term.
ETF Preset Explained
- SCHD (Schwab US Dividend Equity ETF): Invests in high-quality U.S. dividend-paying stocks. It offers a balance of stable dividend income and moderate capital appreciation. Average annual dividend yield ~3.5%, capital growth ~7%.
- QQQ (Invesco QQQ Trust): Tracks the Nasdaq-100 Index, heavily weighted toward technology stocks. Known for high growth potential. Average annual capital growth ~12%, dividend yield ~0.6%.
- S&P 500: A diversified index fund tracking 500 of the largest U.S. companies. The benchmark for broad market performance. Average annual capital growth ~9%, dividend yield ~1.5%.
Dividend Tax Considerations
Dividend income is typically subject to withholding tax. The rate varies by country — for example, 15% in the U.S. for qualified dividends, or 15.4% for Korean tax residents on foreign dividends. This calculator lets you set a custom dividend tax rate to match your specific tax situation. All dividend reinvestment calculations use the after-tax dividend amount.
Tips for Using This Simulator
The longer the investment period, the more powerful the compounding effect. Consistent monthly contributions are key — even small amounts add up significantly over decades. Enabling DRIP (Dividend Reinvestment) will noticeably accelerate your portfolio growth. Compare different ETF presets to find an investment strategy that matches your risk tolerance and goals.