Passive income calculator guide
This calculator estimates the capital needed to create a target monthly passive income from dividends, rental cash flow, interest, or a conservative withdrawal strategy.
What changed in this version
- Shows multiple yield scenarios: 3%, 4%, 5%, and 7%.
- Calculates the gap between your current assets and the target.
- Estimates how long the target may take based on monthly investing.
Calculation method
Required assets = annual passive income ÷ effective yield × safety margin
Effective yield is reduced by the drag estimate. The safety margin increases the required assets to make the estimate less aggressive.
How to use this calculator
- Enter realistic values that match your current situation.
- Press Calculate to refresh the estimate.
- Compare the main result with the supporting details in the result panel.
- Change one input at a time to see which variable affects the result most.
Planning note: Passive Income Calculator gives an educational estimate. It does not include every tax rule, fee, platform policy, market condition, or personal constraint, so use it as a quick planning reference rather than a final decision.
FAQ
Is 4% always safe?
No. The 4% idea is a planning shortcut, not a guarantee. Asset type, volatility, inflation, and taxes matter.
Can this be used for dividends?
Yes. Use the expected dividend yield as the yield rate and include any tax drag if needed.
Why include a safety margin?
Passive income is rarely perfectly stable. A margin helps avoid planning too tightly.