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Is there a calculator on Pearler to help me to predict the amount of dividends I could receive?
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Is there a way (or a calculator) to predict the amount of dividends I could receive if I have different amounts invested in certain ETFs? I am a later in life investor (40s) and would like to teach my son (21) the power of investing and compound interest- more importantly work out what amount of investment would be the target for him to achieve FI by partially or fully using the dividend payouts. Thanks for your help
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NicNac
Asked on 23 February 2024
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Hey NicNac, good question.
I believe Pearler might be working on something in the background for this, but here’s some thoughts.
A few ways to do that:
1- If investing in a balance of Aussie/global index funds, the average dividend yield will probably hover around something like 4% for a balanced portfolio (including franking credits). So to achieve FI, he would need a portfolio which is 25x his annual expenses. If his lifestyle costs $40k pa, he’d need $1m to reach FI, or maybe half that to be semi-FI. Just use a simple compound interest calc and put in average monthly savings, 7% return, and a timeframe, to see what you can reach in 10, 20, 30 years.
2- If you plan to invest in other things instead, the manual way to do this is to build a hypothetical portfolio or choose what you’re going to invest in first. Look at the yield on each of the ETFs and see what income each would pay per year. Then add them up and get the portfolio income/yield. That will help you figure out how much total invested would be needed to reach FI in the future.
Compound interest calculator: https://pearler.com/explore/tools/compound-in...
Hope that’s useful.
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