📅 Monthly Processing: All withdrawals and reinvestments happen on the last trading day of each month, using that day's closing prices.
💰 Withdrawal Priority: Your monthly withdrawal is taken from dividends first. If you have leftover dividends after the withdrawal, they're automatically reinvested based on your portfolio allocation.
📉 Selling When Needed: If dividends don't cover your monthly withdrawal, shares are sold proportionally across your holdings to make up the difference.
🔄 Rebalancing: When reinvesting excess dividends, the calculator buys shares according to your specified allocation percentages, not the current market values.
This approach simulates a realistic income strategy where you're living off your portfolio while maintaining your desired asset allocation.
All withdrawals and reinvestments happen on the last trading day of each month, using that day's closing prices. This simulates a real-world income strategy where you process everything once a month.
Your monthly withdrawal is taken from dividends first. If you have leftover dividends after the withdrawal, they're automatically reinvested based on your portfolio allocation. No dividends are wasted!
If dividends don't cover your monthly withdrawal, shares are sold proportionally across your holdings to make up the difference. This maintains your target allocation while providing the income you need.
When reinvesting excess dividends, the calculator buys shares according to your specified allocation percentages, not the current market values. This helps keep your portfolio balanced over time.
💡 Pro tip: This calculator gives you a real-world view of how income funds actually perform when you're using them for income - not just reinvesting everything forever. Compare high-yield dividend strategies (like SPYI or QQQI) against traditional index funds to see which works better for your retirement or income needs. Experiment with different withdrawal amounts and portfolio combinations to find your sweet spot!