Question 1

What is dividend yield?

Accepted Answer

Dividend yield is the annual dividend per share divided by the stock price, expressed as a percentage. It shows how much income you earn relative to the stock price.

Question 2

What is DRIP?

Accepted Answer

DRIP stands for Dividend Reinvestment Plan. Instead of receiving cash dividends, you automatically reinvest them to buy more shares, compounding your returns over time.

Question 3

How are dividends taxed?

Accepted Answer

Qualified dividends are taxed at the capital gains rate (0-20%), while ordinary dividends are taxed as regular income. Consult a tax advisor for your specific situation.

Question 4

Is this tool free?

Accepted Answer

Yes, this calculator is 100% free and runs entirely in your browser. No data is sent to any server.