Investment fee calculator: what costs take over time
Compare two yearly cost levels on the same plan – for example a low-cost index ETF against an active fund or an adviser fee – and see how much of the final value the difference takes.
- Final value at 0.1%
- 945,875
- Final value at 1.5%
- 680,993
- Difference
- 264,882
- Share of the final value lost
- 28%
Without any cost the plan would reach 968,645: costs of 0.1% take 22,770 of that, costs of 1.5% take 287,652, including the growth those costs would have earned.
How the calculation works
Both plans earn the same return before costs; each yearly cost is taken monthly from the balance. The difference between the two final values is what the higher cost took, including the growth that money would have earned.
The gap widens with time: costs that look small in a single year compound into a large share of the result over decades.
Questions
Why do small yearly fees matter so much?
Because they compound like returns, in reverse. A fee is taken every year from the whole balance, including past growth, and the money taken can no longer grow. Over 30 years, a difference of 1.4 percentage points a year leaves a single investment about a third smaller.
Which costs should I include?
The fund’s ongoing charge (TER or expense ratio), any adviser or platform fee charged as a percentage of assets, and an estimate of trading costs. Taxes are not included.
Are the costs already in ETF returns elsewhere on this site?
Yes. The historical returns of ETFs and lazy portfolios shown on MEDGE are net of each fund’s own ongoing charge, because it is deducted from the fund’s price. This calculator is for comparing cost levels on a return you choose.
Is a cheaper fund always better?
Not automatically: what matters is the return after costs for the risk taken, and funds tracking different markets are not comparable on cost alone. For funds that track the same index, though, lower costs have been one of the most reliable predictors of better net returns.
More free tools
- Portfolio backtestUp to 5 ETFs on real monthly returns
- DCA calculatorMonthly investing with real returns
- Rolling returnsBest and worst 1–15 year periods
- Efficient frontierRisk and return of every mix of 2–3 ETFs
- Drawdown recoveryHow long falls took to recover
- Retirement calculatorMonte Carlo on historical returns
Educational calculator: results depend entirely on the inputs and are not a forecast or investment advice. It runs in your browser; nothing you type is sent or stored.