How to use and examples
3 steps
- Set starting balance, monthly contribution, expected annual return, assumed inflation, and investment horizon.
- Enter expense ratio scenarios (for example 0.20% and 1.00%) and choose end-of-period or beginning-of-period contributions.
- Switch nominal or real-value display, then compare ending balances, total fees, and fee drag.
Input examples
- Example 1: 1,000,000 initial, 30,000 monthly, 6% return, 20 years, 0.2% vs 1.0% fee.
- Example 2: 5,000,000 initial, no monthly contribution, 5% return, 15 years, 0.1% vs 2.0% fee.
Educational scenario tool only. Tax regimes (including NISA/non-NISA), FX, and fund-specific operating costs are not included.
Inputs
Results
Balance chart
Yearly summary table
How it’s calculated
- Annual return is converted to monthly rate as nominal r/12 or effective 12th-root.
- Each month applies growth first, then subtracts monthly fee from the post-growth balance.
- With end-of-period contributions: grow → fee → contribution. Beginning-of-period reverses contribution timing.
- Fee drag equals ending balance at 0% fee minus ending balance in the fee scenario.
- Real-value mode deflates each displayed amount to present value using the inflation assumption (core simulation remains nominal).
For planning and learning only, not investment advice.
FAQ
Why do fees compound over time?
Fees reduce investable balance each period, so future gains compound on a smaller base and the gap expands over long horizons.
Are fund fees deducted daily in real life?
Many funds accrue fees daily, but this calculator uses a monthly approximation for easier scenario comparison.
Should I use nominal or effective return basis?
Use the basis that matches your source assumptions. Nominal uses r/12 and effective uses the 12th-root conversion.
Are taxes, FX, and trading costs included?
No. This tool isolates fee impact only and does not include taxes, bid-ask spreads, FX changes, or product-specific costs.