Dividend Cut Impact Calculator
Estimate how a dividend or distribution cut could affect your income, the extra capital needed to replace it, and the monthly shortfall against your target.
Or estimate it with the portfolio calculator, then continue here.
The affected percentage refers to the share of your dividend income, not the share of your portfolio's market value.
Optional — leave blank to skip the target-shortfall results.
Optional — used to estimate how much new capital would replace the lost income.
Monthly income before cut
US$1,000.00
US$12,000.00 per year
Monthly income after cut
US$700.00
US$8,400.00 per year
Monthly income lost
US$300.00
Annual income lost
US$3,600.00
Before vs. after the cut
Effective total income reduction
30.00%
A 30% cut applied to 100% of your income
| Cut size | Monthly income after cut | Monthly income lost | Annual income lost | Effective reduction |
|---|---|---|---|---|
| 10% | US$900.00 | US$100.00 | US$1,200.00 | 10.00% |
| 20% | US$800.00 | US$200.00 | US$2,400.00 | 20.00% |
| 30% | US$700.00 | US$300.00 | US$3,600.00 | 30.00% |
| 40% | US$600.00 | US$400.00 | US$4,800.00 | 40.00% |
| 50% | US$500.00 | US$500.00 | US$6,000.00 | 50.00% |
Understanding a distribution cut
One holding's cut is not your whole portfolio's cut. When a single fund or stock reduces its distribution, only the income from that holding changes. Use the "share of income affected" input to model this: if one holding provides 20% of your income and cuts its distribution by 50%, only that 20% is exposed to the cut — your total income falls by 10%.
An income cut is not a market-price loss. A reduced distribution lowers your income, but your invested capital doesn't automatically shrink with it. Price movements are a separate risk, so this calculator measures the income effect only.
Replacement yield is an assumption, not a guarantee. The capital-needed estimate assumes new money earns exactly the yield you enter and that your remaining income stays unchanged. Real yields vary over time, and higher yields usually come with higher risk — this tool does not recommend chasing yield.
Taxes, fees, exchange-rate changes and market price movements are all excluded from this calculation. Results are estimates for educational purposes, not financial advice.
Frequently asked questions
What happens if only one holding cuts its distribution?
Set the "share of income affected" to that holding's share of your total dividend income. The rest of your income is modelled as unchanged, so the effective reduction equals the affected share multiplied by the cut size.
Is a dividend cut the same as a fall in share price?
No. A distribution cut reduces the income your holdings pay you; a price fall reduces their market value. They are related risks but move separately — this calculator measures the income effect only.
How much extra capital could replace lost income?
It depends on the yield new capital can earn. The estimate divides your annual lost income by the replacement yield you enter — for example, $1,800 of lost annual income at a 6% yield suggests about $30,000 of new capital. That's an assumption-based estimate, not a guarantee.
Does this include taxes, fees or exchange-rate changes?
No. Taxes, account fees, currency effects and price movements are excluded. Enter figures that reflect your own after-fee situation if you want them accounted for.
How this calculator works
Affected monthly income = current monthly income × affected % ÷ 100Monthly income lost = affected monthly income × cut % ÷ 100Monthly income after cut = current monthly income − monthly income lostEffective total income reduction = affected % × cut % ÷ 100Target shortfall = max(0, monthly income target − monthly income)Replacement capital = annual income lost ÷ (replacement annual yield ÷ 100)
- The affected percentage is the share of your dividend income affected by the cut — not the share of your portfolio's market value.
- Replacement capital is an assumption-based estimate: it assumes new capital earns the entered yield and your remaining income stays unchanged. It is not a recommendation to chase higher yields.
- Taxes, fees, exchange-rate changes and market price movements are excluded from this calculation.
- Estimates use your entered figures only; no live market data is fetched.
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