Investment Fee Impact Calculator
A 1% annual management fee sounds small — but it can cost you 20–25% of your final balance over 30 years. See the real numbers.
Investment fees compound against you just as returns compound for you. On $100,000 invested for 30 years at 8% gross: a 0.1% TER (index ETF) leaves $996k; a 1% active fund fee leaves $761k; a 2% fee leaves $574k. The difference between a cheap ETF and an expensive fund can exceed $420,000.
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Fee Impact Calculator
Principal · Monthly contribution · Gross return · Fund fee
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Your investment
$
$
years
%
% TER
% TER
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Results
Without any fee (theoretical)
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With low-fee fund (0.1% TER)
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With high-fee fund (1.5% TER)
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Wealth lost to high fees
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How it's calculated
How fees compound against you
A management fee is deducted from your effective annual return. The compounding effect means you lose not just the fee itself — you lose all future growth on the fee amount too.
Net return = Gross return − Fund fee
Final value = P × (1 + r_net/12)^(12×t)
+ PMT × [(1 + r_net/12)^(12×t) − 1] / (r_net/12)
Wealth destroyed by fees = FV(low fee) − FV(high fee)
Example: $50k + $500/mo, 8% gross, 30yr
Low fee (0.1%): net 7.9% → $809,174
High fee (1.5%): net 6.5% → $613,822
Difference: $195,352 (24% of low-fee balance)
- TER (Total Expense Ratio)
- Annual percentage of fund assets charged for management, admin, and operating costs. Automatically deducted from NAV — never seen as a line item.
- Index fund / ETF
- A fund tracking a market index (e.g. S&P 500). No active management means very low fees — typically 0.03%–0.20%.
- Active fund
- A fund where managers pick stocks trying to beat the index. Higher fees (0.5%–2%+), but most active funds underperform their benchmark net of fees over long periods.
Disclaimer: this calculator uses constant rate assumptions. Actual fund returns vary year to year. Past performance does not guarantee future results.
Frequently asked questions
How much does a 1% fee cost over 30 years?
On $100,000 at 8% gross: a 1% fee reduces your net return to 7%, leaving $761,225 vs $1,006,266 without the fee — a difference of $245,041, or 24% of the final balance. The fee cost is amplified by compounding over long periods.
What TER should I look for in an index fund?
For broad market index ETFs: under 0.20% is excellent. Many Vanguard, iShares, and SPDR ETFs charge 0.03%–0.10%. These fees have fallen dramatically over the past 20 years due to competition. Always check the fund's KIID or prospectus for the exact TER.
Do higher fees mean better performance?
No — research consistently shows the opposite. Morningstar's "fee study" finds that expense ratio is the single strongest predictor of fund performance: the cheapest quintile of funds consistently outperforms the most expensive quintile in every major asset class. Fees are certain; outperformance is not.
Where do I find a fund's TER?
In the fund's KIID (Key Investor Information Document) for EU-domiciled funds, or the Prospectus/Summary Prospectus for US funds. Also shown on fund-comparison sites (Morningstar, JustETf for EU, ETF.com for US).