Yield on Cost Calculator
Your real dividend yield is based on what you paid, not today's price. See your yield on cost now and how dividend growth lifts it over the years. Instant, no sign-up, formula shown.
Your yield on cost, climbing over time
Each dividend raise lifts the return on the price you originally paid — the current buyer's yield never moves like this.
Yield on cost & income by year
The same shares, the same cost — a rising effective yield and a growing paycheck.
| Time held | Yield on cost | Annual income |
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The exact formula — with your numbers
Yield on cost is today's dividend over your original price; projected forward it grows with the dividend:
Div0 = current annual dividend per share · g = dividend growth rate · n = years held · price = your original cost per share.
How to use this yield on cost calculator
- Enter your purchase price and current dividend. Those two give your yield on cost today.
- Add the dividend growth rate. Use the company's recent annual dividend-increase history as a guide.
- Pick a horizon. See how many years of raises compound your effective yield and income.
Why yield on cost matters
New buyers see a stock's current yield — dividend divided by today's price. But if you've held for years, what matters is the dividend against your cost. A quality dividend grower bought at a modest 3–4% yield can quietly become a 10%+ yield on cost after a decade of raises, all while you did nothing. This is the engine behind long-term dividend investing: you're not chasing the highest yield today, you're buying rising income on a fixed cost basis. Pair this with our dividend calculator to model total income with reinvestment.
Frequently asked questions
Is a high yield on cost always good?
It's a sign of a durable, growing dividend — but it reflects the past. Always check that the company can keep raising its payout (reasonable payout ratio, growing earnings). A high YOC on a stock about to cut its dividend is a warning, not a win.
Does yield on cost account for reinvested dividends?
No — YOC measures the payout on your original shares only. If you reinvest dividends to buy more shares, your total income grows faster; model that with our dividend/DRIP calculator.
What dividend growth rate should I use?
Look at the stock's 5- and 10-year dividend growth history and be conservative. Past growth doesn't guarantee future raises, especially in downturns.
Method & sources
- Calculation: YOC = annual dividend ÷ original price; projected with constant annual dividend growth (shown above). Verified against an independent test suite.
- Yield on cost is a widely used dividend-investing metric; it measures return on your cost basis, not current market yield.
- Reviewed: · Assumptions reviewed quarterly.
Educational estimate, not financial advice. Dividends can be cut and are not guaranteed.