How to use this calculator
The page has two parts. The quick calculator at the top answers one question at a time:
- Income from an amount: enter what you have invested and your portfolio’s yield to see the monthly income.
- Amount for an income: enter the monthly income you want and the yield you expect to see how much you need invested.
The payout planner lists your holdings one by one:
- Name: any label you like. It only appears in your results.
- Shares: how many shares you own. Fractions are fine.
- Dividend per share, each payment: the amount of a single payment, not the yearly total.
- Frequency and first payment month: together these place each payment on the calendar.
The formula
Monthly income = Amount invested × Yield ÷ 12
Amount needed = Monthly income × 12 ÷ Yield
Each payment = Shares × Dividend per share, each payment
Month total = Sum of every payment that lands in that month
The yield is written as a decimal in the math: 4% is 0.04. In the planner, a quarterly holding pays every third month starting from its first payment month, a semi-annual one every sixth month, and an annual one once.
Worked example
Quick part, using the starting numbers: $100,000 at a 4% yield gives $100,000 × 0.04 ÷ 12 = $333.33 a month. Going the other way, $1,000 a month at 4% needs $1,000 × 12 ÷ 0.04 = $300,000.
The planner starts with three holdings:
- Stock A: 100 shares × $0.60 = $60.00, paid in January, April, July and October.
- Stock B: 150 shares × $0.45 = $67.50, paid in February, May, August and November.
- Fund C: 200 shares × $0.10 = $20.00, paid every month.
January gets $60.00 + $20.00 = $80.00. February gets $67.50 + $20.00 = $87.50. March only gets the monthly fund: $20.00. The pattern repeats every quarter, for a yearly total of $750.00, or $62.50 a month on average.
The gap in March, June, September and December is the useful part. A stock on the March cycle would fill those months and even out the income.
Building a monthly income calendar
Almost every quarterly payer in the US follows one of three cycles: January–April–July–October, February–May–August–November, or March–June–September–December. If all your holdings sit on one cycle, you get four big months and eight empty ones. Spread them across all three and something arrives every month.
The month a dividend is paid can differ from the month it’s announced or the month of the ex-dividend date. For budgeting, use the pay date. A company’s dividend history on its investor relations page usually lists past pay dates, and they tend to repeat year to year.
Monthly payers vs quarterly payers
Monthly payers make the calendar easy, but don’t pick a holding for its schedule alone. Many monthly payers are funds or REITs with higher yields and slower dividend growth. A quarterly payer that raises its dividend every year can end up paying you more within a decade. The Dividend Growth Calculator shows how fast a growing dividend catches up.
Tip: if you live on the income, keep one month of spending as cash. Payments shift by a few days from year to year, and a pay date that slips from the 30th to the 2nd moves money into the next month.
What this calculator leaves out
All amounts are before tax. In a taxable account, dividends count as income in the year you receive them; the Dividend Tax Calculator estimates how much you keep. The planner also assumes each dividend stays the same all year. Companies can raise, cut or skip a payment, so check recent announcements for the holdings you depend on most.