Compare what a low-fee fund and a higher-fee fund return over your investment horizon. Fees that look small as percentages become large as dollar amounts over time.
Your investment
Leave 0 if lump sum only
Before fees. Long-run diversified equity: ~7–9%
Compare fee rates
e.g. 0.07% for broad index ETFs
e.g. 0.67% for actively managed funds
Fee cost over 20 years
$41.7k
That is 8.3% of what the low-fee portfolio would have accumulated.
Low-fee (0.07%)
$502.5k
Higher-fee (0.67%)
$460.8k
Total contributed over 20 years: $170.0k. All returns above that are investment growth, which fees reduce compounding on year over year.
Portfolio value over time
Year 5
Difference: $2.4k
Year 10
Difference: $8.2k
Year 15
Difference: $20.0k
Year 20
Difference: $41.7k
Why fees compound negatively
A fee is not deducted once. It is charged each year on the full balance, including previous years' growth. This means fees compound against you in the same way that returns compound for you. Early in the investment period the annual dollar cost is small. Later, when the balance is large, the same percentage fee costs much more in dollar terms — and those dollars cannot continue compounding.
This calculator uses a simplified compound growth model with a constant annual fee deducted from the gross return. It assumes a single gross return rate throughout the period. Real outcomes vary due to market fluctuations, variable contributions, and other factors. This is general educational information only and does not constitute financial advice. Illuminvest does not hold an AFSL.