Project dividend income over the next decade

The job

Dividend compounding has two engines: reinvested payouts buying more shares, and companies raising the dividend itself. A 3% yield growing 8% a year is a very different thing in year 10 than in year 1 — the table shows the difference.

Inputs and the table

Initial investment, monthly additions, current yield, annual dividend growth, years, and whether dividends reinvest. Each year row shows balance, that year's dividend, and effective yield on your original cost.

• Effective yield is the honest number — a stock bought at 3% yielding 6% on cost after a decade of growth.
• Growth assumptions compound aggressively; a 10%/yr dividend growth input is a promise no company keeps forever.

Honest scope

The model is annual and friction-free: no taxes, no price appreciation on the balance (just the inputs growing), no dividend cuts. It's a planning aid for understanding the mechanism — not a forecast, not advice.