Passive Income from Capital Calculator

How to use

1. Enter your total initial invested capital principal.
2. Specify your expected annual portfolio rate of return.
3. Input your planned monthly living expense withdrawal.
4. Designate an estimated annual inflation rate for expense escalation.
5. Adjust the simulation planning timeline (5 to 45 years).
6. Analyze capital longevity, total money withdrawn, and perpetual safe withdrawal rates.

Understanding Passive Income from Capital

Passive income from invested capital is the return generated by your accumulated assets without requiring ongoing daily labor.

This calculator models capital longevity, showing whether your planned withdrawals allow perpetual sustainability or lead to capital depletion.

Key Factors Determining Passive Cash Flow

Passive income yields depend on critical financial parameters:

• Capital Size: Larger portfolios generate more absolute yield at identical interest rates;
• Annual Rate of Return: The gross yield commanded by your underlying asset allocation;
• Investment Horizon: Time allowing compounding returns to accumulate;
• Reinvestment vs. Distribution: Leaving a portion of profits protects capital from depreciation;
• Taxes and Expense Ratios: Brokerage fees and dividend withholding taxes;
• Inflation: Preserving real purchasing power against rising cost of living.

Benchmark Scenario: 1,000,000 UAH at 8% Annual Yield

Assuming an investment base of 1,000,000 UAH earning 8% per annum:

• Starting capital: 1,000,000 UAH;
• Expected annual return: 8%;
• Annual passive payout: 80,000 UAH;
• Monthly passive income: ~6,667 UAH.

Methodology & Accuracy

Calculations use monthly compounding cash-flow simulation indexed for inflation. Results are for educational and planning purposes only.