Set the income goal
The calculator starts with the monthly cash flow you want to receive and converts it into an annual target.
Core Idea
The simulator works backward from your income target. Instead of asking what a portfolio might earn, it asks how much capital you need to produce a chosen monthly cash flow. That makes the output useful for planning, because the answer is tied to the outcome you care about.
The key input is net yield, not headline yield. Gross yield is reduced by taxes and fund fees, so the cash you actually keep is lower than what screeners usually show. Using gross yield alone can materially understate the capital required.
Key equation
Required Capital = Annual Income Target ÷ Net Yield
The same target can require very different capital levels depending on tax rate, expense ratio and the yield you can realistically sustain.
What the Model Includes
Taxes and Fees
Taxes reduce the dividend income that reaches your account, while expense ratios reduce portfolio efficiency. Both directly increase the capital you need.
Inflation
Income targets are adjusted over time so the plan preserves purchasing power instead of assuming today’s euro or dollar will be worth the same in the future.
Dividend Growth
Companies can raise payouts over time, so the model lets dividend income grow rather than treating payouts as flat forever.
Monte Carlo Simulation
Thousands of randomized scenarios are generated to show a distribution of possible outcomes. That helps capture uncertainty instead of hiding it.
How the Simulation Is Built
Convert to net yield
Taxes and fund costs are deducted so the model works with what actually lands in your account, not the headline yield.
Stress the assumptions
Dividend growth, inflation and random variation are layered into many scenarios to expose both upside and downside paths.
How to Use the Output
The median result is helpful as a baseline, but planning usually needs a buffer. That is why the calculator highlights multiple percentiles, including more conservative outcomes. P75 is a practical planning anchor, while P90 is a stronger stress test.
Use the result to compare scenarios, test different tax rates, and see how much capital is needed if your yield or growth assumptions change. The point is to make the tradeoffs visible before you commit capital.