Expense Ratio Calculator: The Annual Cost of Fund Fees
Work out what a fund's expense ratio actually costs in dollars each year — a fee that is easy to overlook because it is never billed directly.
Adjust the inputs and select Calculate for a full breakdown.
Compare Common Scenarios
How the numbers shift across typical situations for this calculator:
| Scenario | Annual fee | Invested after the fee |
|---|---|---|
| 0.65% of $50k | 325 | 49,675 |
| 0.04% of $100k | 40 | 99,960 |
| 1.0% of $250k | 2,500 | 247,500 |
| 0.3% of $20k | 60 | 19,940 |
How This Calculator Works
Enter the fund's expense ratio and the amount you have invested in it. The calculator multiplies the two to give the annual fee in dollars, the amount quietly deducted from the fund's assets over the year.
The Formula
Percentage of an Amount
Amount is the base value, Percentage is the rate applied to it
Worked Example
On $50,000 invested in a fund with a 0.65% expense ratio, the annual fee is $325. It is never invoiced — it is taken from fund assets — but it is a real, recurring cost every single year.
Key Insight
An expense ratio looks tiny but compounds against you. The fee is charged every year on a balance that is usually growing, so over decades a fund one percentage point cheaper can leave you with far more money.
Frequently Asked Questions
What is an expense ratio?
An expense ratio is the annual fee a mutual fund or ETF charges, expressed as a percentage of assets. It covers management and operating costs.
How is the expense ratio charged?
It is not billed directly. The fee is deducted from the fund's assets over the year, which slightly lowers the return you receive.
Why does a small ratio matter?
The fee is charged every year on a balance that tends to grow, so it compounds. Over decades, even a fraction of a percent adds up to a large sum.
What is a low expense ratio?
Broad index funds often charge well under 0.20%, while some actively managed funds charge 1% or more. Lower ratios leave more of the return with you.
Is the expense ratio the only fund cost?
No. Some funds also carry sales loads or trading costs. The expense ratio is the main recurring fee, but check for others before investing.
Related Calculators
Data Sources & Benchmarks
This calculator draws on 1 independent, dated source.
Methodology & Review
The annual fee is the amount invested multiplied by the expense ratio. It is a single-year figure; over time the fee is charged on a changing balance and compounds against the investor.
Written by Ugo Candido · Last updated May 17, 2026.