The Passive Income Goal Calculator estimates how much invested capital is needed to produce a target monthly income at an assumed annual cash yield. It can also compare the required capital with current invested assets and translate the gap into a savings timeline. The model is useful for initial planning, but yields, taxes, inflation, fees, and distributions can change.
Enter the cash income desired before tax.
Use a sustainable cash yield assumption, not an unusually high temporary distribution.
Include only assets intended to support this income goal.
The simple timeline ignores growth while saving and shows the gap divided by monthly additions.
Stress-test lower yields because required capital rises when yield falls.
The simple savings timeline equals the capital gap divided by monthly savings and does not compound returns.
The result is the capital base that would produce the target income if the assumed annual cash yield were achieved.
Investment income is not guaranteed, and preserving purchasing power may require reinvestment rather than spending every distribution.
Given: $3,000 monthly goal, 4% annual yield, $150,000 current capital, and $2,000 monthly savings.
Calculation: Annual goal = $36,000. Required capital = $36,000 ÷ 0.04 = $900,000. Gap = $750,000.
Result: Without growth, $2,000 monthly contributions would close the gap in 375 months.
Use the cash yield you realistically expect to spend. Total return includes price changes that may not provide spendable cash without selling assets.
If the target is after tax, increase the pre-tax income goal using an appropriate estimated tax rate.
Each dollar of capital generates less annual income, so a larger base is needed.
No. It is a simple contribution-only estimate so the effect of the current gap remains clear.
No. Dividends, interest, rent, and other distributions can change, and principal can lose value.