How much do I need invested for passive income?

Divide your target annual income by the yield you expect. For example, $20,000 a year at a 4% yield needs $500,000 invested. The lower the yield, the more capital you need.

What yield should I use?

Use a realistic, sustainable yield for your investments, whether dividends, interest or rent, after costs. Higher assumed yields need less capital but usually carry more risk.

Is passive income taxed?

Yes, income from dividends, interest and rent is generally taxable, so the after-tax income is less than the headline figure. Use a net yield or allow for tax when planning.

Passive Income Target Calculator

This calculator shows how much you need invested to generate a target level of passive income, from dividends, interest or rent. You enter the income you want and an expected yield, and it works out the capital required, helping you set a concrete savings goal behind an income dream.

Target passive income (per year)

Expected net yield

Invested so far

capital needed to generate your target income

Still to invest$0

Income from what you have$0

Per month target$0

Use a realistic net yield, after costs and ideally after tax, since income is taxable. A lower yield needs more capital. This shows the income return only, not capital growth. Estimate only, not financial advice.

How it works

The capital you need is your target annual income divided by the yield you expect. The calculator also shows how much income your current investments already throw off at that yield, and the gap still to invest. Because a lower yield means more capital is needed for the same income, using a realistic, after-cost yield keeps the target honest.

Worked example

To earn $20,000 a year at a 4% net yield, you need $500,000 invested. With $150,000 so far producing about $6,000 a year, you have $350,000 still to invest to hit the full income target.

Related calculators

FIRE Number Calculator: your independence number.
Dividend Calculator: dividend income.
Investment Calculator: project investments.
Compound Interest Calculator: growth over time.

If you've found a bug, or would like to contact us, or learn more about James Graham and Calculate.co.nz.

Calculate.co.nz is partnered with Interest.co.nz for New Zealand's highest quality calculators and financial analysis.

All calculators and tools are provided for educational and indicative purposes only and do not constitute financial advice.

Calculate.co.nz is proudly part of the Realtor.co.nz group, New Zealand's leading property transaction literacy platform, helping Kiwis understand the home buying and selling process from start to finish. Whether you're a first home buyer navigating your first property purchase, an investor evaluating your next acquisition, or a homeowner planning to sell, Realtor.co.nz provides clear, independent, and trustworthy guidance on every step of the New Zealand property transaction journey.

Calculate.co.nz is also partnered with Health Based Building and Premium Homes to promote informed choices that lead to better long-term outcomes for Kiwi households.

Calculate.co.nz is hosted in Auckland via SiteHost new Zealand.

All content on this website, including calculators, tools, source code, and design, is protected under the Copyright Act 1994 (New Zealand). No part of this site may be reproduced, copied, distributed, stored, or used in any form without prior written permission from the owner.