SCHD Dividend Reinvestment Calculator

The SCHD ETF is a popular choice among long-term investors focused on dividend growth. Using the SCHD Dividend Reinvestment Calculator, you can predict future dividends and create a solid investment plan.

SCHD Dividend Calendar 2025

How to Use the Dividend Reinvestment Calculator

Learn the step-by-step guide on how to use the SCHD Dividend Reinvestment Calculator, with detailed explanations of each field and projections of changes in dividend income and total valuation over time.

Field Descriptions

• Initial Investment: The amount you initially invest. Enter the valuation if you already own SCHD.
• Monthly Investment: The amount you invest regularly every month.
• Dividend Yield: The annual dividend rate, prorated for quarterly payouts. SCHD's average yield is approximately 3.5%.
• Dividend Growth Rate: The annual growth rate applied to dividends at the beginning of each year. SCHD's average dividend growth rate is 12%.
• Price Growth Rate: The annual growth rate of the share price, applied at the beginning of each year. SCHD's average price growth rate is 10%.
• Length of Investment: The total duration of your investment in years.
• Tax Rate: The tax rate applied to dividend income. See detailed tax explanations below.
• Dividend Frequency: The number of dividend payments each year (e.g., 4 times quarterly or 12 times monthly).

1. What is SCHD ETF?

SCHD (Schwab U.S. Dividend Equity ETF) is an ETF launched by Charles Schwab in October 2011. It focuses on investing in high-dividend, quality stocks, emphasizing U.S. large-cap dividend growth stocks to provide stable and consistent income.

SCHD Portfolio Principles

Top 10 Portfolio Holdings (Q4 2024)

As of Q4 2024, SCHD's top holdings include Home Depot, BlackRock, and Cisco. The full list of holdings can be found on the SCHD ETF website.

2. What is Dividend Reinvestment?

Dividend reinvestment is a strategy where dividends are reinvested into purchasing more shares or ETFs instead of receiving them in cash. This approach promotes long-term asset growth by reinvesting dividends rather than consuming them.

Dividend reinvestment leverages the compound interest effect, allowing your assets to grow exponentially over time. By reinvesting dividends, you can maximize the compounding effect and accelerate the growth of your investments.

The chart above compares the total return after 10 years of investing $10,000 in SCHD, with and without dividend reinvestment.
Dividend reinvestment results in a 213% total return, compared to 178% without reinvestment, a difference of approximately 35%.
The gap widens over time, making dividend reinvestment essential for those investing in dividend growth stocks like SCHD.

3. SCHD ETF's Long-Term Investment Performance

SCHD has delivered impressive results for long-term investors. Over the past 5 years, SCHD has recorded an average annual return of over 10%, offering both dividend income and capital gains as a stable investment product.

3-1. Historical Performance of SCHD

Over the last 5 years, SCHD has consistently increased both its dividend income and capital gains, making it a strong performer for long-term investors.

3-2. Comparing SCHD to Other Dividend ETFs

Compared to other dividend ETFs, SCHD stands out for its low expense ratio and high dividend yield. When compared to the Vanguard High Dividend Yield ETF (VYM), SCHD offers greater potential for dividend growth.

4. Impact of Trump's Presidential Victory on SCHD Investments

Donald Trump's presidential victory could significantly affect SCHD, a dividend-focused ETF, along with various sectors of the economy. Understanding these impacts is crucial for investors making informed decisions.

Market Reactions Post Trump Victory

Following Trump's election, the U.S. stock market experienced these major trends:

• The financial sector surged on expectations of deregulation and tax cuts.
• The energy sector rose on increased domestic drilling and anticipated environmental deregulation.
• Renewable energy stocks declined amid concerns over reduced support for green policies.

These sectoral shifts could influence the performance of dividend-focused ETFs like SCHD.

Policy Changes and Their Effects

Trump's proposed economic policies include:

• Significant tax cuts for individuals and corporations
• Widespread deregulation across industries
• Imposing tariffs to protect domestic industries

While tax cuts and deregulation could boost corporate profits and positively impact dividend stocks, tariffs could create trade tensions affecting sectors reliant on global supply chains.

Implications for SCHD Investors

SCHD focuses on high-quality U.S. companies with a stable history of dividend payments. Trump's policies might enhance corporate profitability, sustaining and growing dividends. However, increased market volatility and sector-specific risks are also possibilities.

Further Reading on Trump's Presidency

• Impact of a Strong Dollar on Emerging Market Stocks and Metals (MarketWatch)
• Balancing Trump's Stimulus and Inflation Risks for Small-Cap Stocks (Reuters)
• What Trump's Presidency Means for Your Investments (The Times)

5. Points to Consider in Dividend Reinvestment

Dividend reinvestment can yield significant long-term returns but comes with important considerations. Not all companies consistently pay or increase dividends, so minimizing individual stock risk is crucial when investing in dividend stocks.

Risks of Dividend Reinvestment Strategies

Dividends may be reduced or discontinued based on economic conditions. Therefore, selecting ETFs like SCHD can help mitigate individual company risks within the portfolio.

Key Factors to Consider

• 💵 Exchange Rate Fluctuations: Dividend income from foreign stocks can vary based on exchange rates. Declining exchange rates may reduce the value of dividends, so managing currency risk is essential.
• 💰 Taxes: Dividends are taxable income. For foreign stocks, local withholding taxes may apply in addition to domestic taxes, so understanding the tax structure is vital to calculating post-tax returns.
• 🎢 Market Conditions: Dividends may decrease or cease depending on economic conditions or company performance. Conduct thorough analysis of a company’s financial status and market outlook before investing.

6. Conclusion: Achieving Stable Returns Through SCHD Dividend Reinvestment

SCHD is an ETF with high dividends and growth potential, making it suitable for long-term investors. Through dividend reinvestment, you can maximize the compounding effect and expect stable asset growth over time.

For the latest SCHD dividend information, check 👉 SCHD Q3 2024 Dividends and Portfolio!

FAQ(Frequently Asked Qustions)

Q1: Can I receive dividends if I purchase SCHD on the ex-dividend date?

A: No, you cannot receive dividends if you purchase SCHD on the ex-dividend date. To be eligible for dividends, you must purchase the stock at least one day before the ex-dividend date or 2–3 business days earlier to account for settlement.

Q2: What is the rebalancing cycle for SCHD's portfolio?

• Quarterly Rebalancing: SCHD rebalances its portfolio every quarter to align with its investment strategy.
• Annual Reconstruction: A comprehensive review and modification of the portfolio's constituent stocks occur once a year. During the annual reconstruction, new stocks may be added, and existing stocks may be excluded. For instance, in the 2024 March reconstruction, 23 stocks were added, and 23 stocks were removed.

Calculation Logic

The SCHD Dividend Reinvestment Calculator calculates your total assets and dividend income through the following process:

1. Initial Share Purchase: The initial investment is used to purchase as many shares as possible, with the remaining amount kept as cash.
2. Dividend Calculation: Dividends are calculated by multiplying the per-share dividend by the number of shares owned. After taxes are deducted, the dividends are reinvested to purchase additional shares.
3. Price Growth and Dividend Growth: At the beginning of each year, price and dividend growth rates are applied to adjust the share price and dividends accordingly. (As prices rise, the number of shares that can be purchased may decrease.)
4. Monthly Purchases and Cash Handling: Each month, the set investment amount and dividend income are combined to purchase as many shares as possible. Remaining cash is retained.
5. Total Valuation Calculation: At the end of each month, the total valuation is calculated as (share price x number of shares) + remaining cash.

Example Calculation

Let’s assume a $500 monthly investment in SCHD over 10 years with an annual dividend yield of 3.5%, reinvestment of dividends, and a share price growth rate of 10%.

• Annual Changes: At the start of each year, dividends per share and share prices increase. Toward the year-end, the growth rate of dividends accelerates.
• Monthly Changes: During dividend payment months, dividends are automatically reinvested, increasing the number of shares held. By the end of the year, the total valuation reflects these reinvestments and stock price growth.

Things to Keep in Mind