Dividend calculator: how much capital you actually need
Work out how much you would need invested to live off dividends, with tax already taken out. The usual shortcut (income ÷ yield) falls short, because in Spain dividends are taxed as savings income every year you collect them.
Your numbers
You set the dividend yield yourself: it depends on what you hold and it changes over time. Check the current figure on each fund’s official factsheet before trusting any estimate.
Capital needed
€429,656
Gross dividend per month
€1,253
What you need to collect before tax
Tax per year
€3,038
Effective rate of 20.2% on the dividend
Years to get there
23 years
What almost nobody tells you
That difference is extra capital you have to accumulate for the sole purpose of covering the annual tax on the dividend.
Indicative calculation using the current Spanish savings-income brackets (19% to 28%). It does not model withholding at source on foreign funds, personal allowances or your specific tax situation. This is not financial or tax advice.
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Create free accountDistributing funds and ETFs in the catalog
Not every distributing fund fits: a thematic ETF pays a dividend but is not an income vehicle. These are the 12 dividend-focused funds in the catalog (high yield, aristocrats, quality income), cheapest fee first:
Frequently asked questions
How much do I need invested to live off €1,000 a month in dividends?+
With a 3.5% gross dividend yield you would need around €429,656 to keep €1,000 a month after tax. The quick answer you usually see — €342,857 — forgets that dividends are taxed every single year, which is why the real figure is about €86,799 higher.
Why is the figure higher than income divided by yield?+
Because in Spain dividends are taxed as savings income the year you receive them, at 19% to 28%. To end up with €1,000 net you have to collect more than that gross — €1,253 a month in this case — so the portfolio behind it has to be bigger.
How much tax would I pay each year?+
About €3,038 a year, an effective rate of 20.2% on the dividend. Unlike an accumulating fund, where tax is deferred until you sell, this is a bill you pay every year whether you need the money or not.
Is living off dividends better than the 4% rule?+
They are different strategies, not better or worse. Dividends leave your shares untouched and give you predictable income, but you are taxed annually and you give up the flexibility of choosing when to realise gains. The 4% rule sells a slice of the portfolio, so you only pay tax on the gain portion of what you sell.
What dividend yield is realistic?+
It depends entirely on what you hold, and it changes over time — so treat the yield here as an input you should check, not a promise. Broad high-dividend and dividend-aristocrat ETFs have historically sat in a different range from a plain world index. Always check the current figure on each fund's official factsheet.