Passive Income Calculator

A passive income calculator helps estimate how much income you can generate from investments and additional income streams over a specified period.

How to Use the Calculator

Enter the following details:

Investment Amount
– The initial amount invested to generate passive income.
Expected Annual Return Rate (%)
– The anticipated yearly return on the investment.
Additional Income Streams (if applicable)
– Extra sources of passive income such as rental income, dividends, or royalties.
Duration (in years)
– The number of years the investment will generate passive income.

Formulas

Calculate Annual Passive Income from Investment

Annual Passive Income=Investment Amount×(Expected Annual Return Rate100)\text{Annual Passive Income} = \text{Investment Amount} \times \left( \frac{\text{Expected Annual Return Rate}}{100} \right)

Calculate Total Passive Income Over the Duration

Total Passive Income=Annual Passive Income×Duration\text{Total Passive Income} = \text{Annual Passive Income} \times \text{Duration}

Include Additional Income Streams

Total Passive Income Including Additional Streams=Total Passive Income+(Additional Income Streams×Duration)\text{Total Passive Income Including Additional Streams} = \text{Total Passive Income} + (\text{Additional Income Streams} \times \text{Duration})

Example Calculation

Let’s assume:

Investment Amount = $50,000
Expected Annual Return Rate = 6%
Additional Income Streams = $5,000 per year (rental income)
Duration = 10 years

Step 1: Calculate Annual Passive Income

50,000×(6100)=3,00050,000 \times \left(\frac{6}{100}\right) = 3,000

Annual Passive Income = $3,000

Step 2: Calculate Total Passive Income Over 10 Years

3,000×10=30,0003,000 \times 10 = 30,000

Total Passive Income = $30,000

Step 3: Include Additional Income Streams

30,000+(5,000×10)=30,000+50,000=80,00030,000 + (5,000 \times 10) = 30,000 + 50,000 = 80,000

Total Passive Income Including Additional Streams = $80,000

Frequently Asked Questions (FAQs)

What is passive income?

Passive income is money earned with little or no active effort, such as interest, dividends, rental income, or royalties.

Does this calculator account for compounding?

No, this calculator assumes simple returns. If you'd like to include compounding, we can modify the formula.

What are common passive income sources?

Investments (stocks, bonds, REITs)
Real estate rentals
Dividends & interest
Royalties (books, music, patents)

How can I increase my passive income?

Invest in higher-yield assets
Diversify income streams
Reinvest returns for compounding growth