# Dividend snowball calculator

> Machine-readable mirror for AI agents. Canonical page: https://www.portfolioglance.com/calculators/dividend-snowball-calculator
> Content language: English.

> Polish version: append `?hl=pl` to this URL.

See how reinvested dividends — growing year after year — snowball into a rising stream of passive income. Set your starting yield, dividend growth and monthly investing, and watch what your portfolio could pay you each year.

> Each calculator serializes its inputs into the URL query string of its interactive page, so a filled-in scenario is a shareable link.

## How the dividend snowball works

The dividend snowball is compounding you can see. Every dividend you reinvest buys more shares, and those shares pay their own dividends the next time around. On top of that, quality companies tend to raise their payout each year, so the same shares throw off more cash over time. Put those two forces together — reinvestment and dividend growth — and your annual income doesn't just rise, it accelerates. The number that captures it is yield on cost: your current annual dividends divided by everything you ever put in. It starts near the yield you bought at and climbs from there. This calculator models both the reinvestment and the dividend growth that most yield-only tools ignore, so the projection reflects how income investing actually compounds. It is a hypothetical projection on the rates you enter — real yields, dividend growth and prices vary and are never guaranteed — and it never depends on any single stock's live data.

## Frequently asked questions

### What is a dividend snowball?

It's what happens when you reinvest dividends: each payout buys more shares, which pay their own dividends, which buy still more shares. Combined with companies raising their dividends over time, the income compounds and accelerates — like a snowball rolling downhill and picking up more snow.

### What is DRIP, and why does it matter?

DRIP (dividend reinvestment) automatically buys more shares with every dividend instead of paying it out as cash. It's the engine of the snowball: turn it off and your income grows only through dividend increases and new contributions; turn it on and every payout compounds into the next one.

### Dividend yield vs dividend growth — what's the difference?

Yield is the dividend as a percentage of today's share price. Dividend growth is how fast that payout rises each year. A modest 3% yield growing 8% a year can out-earn a static 6% yield given enough time — which is exactly why this calculator models both, unlike simple yield-only tools.

### Does the calculator account for tax?

Optionally, yes — a tax applied to each dividend. If you invest through a tax-advantaged retirement account, set the rate to 0% in advanced options. The tax reduces both the cash you reinvest and your final income, so it matters more the longer you compound.

### What is yield on cost?

Yield on cost is your annual dividend income divided by everything you've invested. It starts near the yield you bought at and climbs as dividends grow and reinvest. A rising yield on cost is the whole point of dividend-growth investing — it's how a 3% starting yield becomes an 8% or 10% income stream years later.

### Does it use real stock or ETF data?

No — it's a pure projection from the yield, growth and contributions you enter, so it works for any dividend stock or ETF (SCHD, VOO, a basket of your own). Use the yield and growth figures of the holdings you have in mind. It never fetches live prices, so it always works and can't break.

*This calculator provides simplified estimates for educational purposes only and is not financial advice. Real dividends, dividend growth and investment returns will differ. Consult a qualified financial advisor before making decisions.*