Tool · Cost
Expense-ratio cost calculator
0.20% and 0.03% look like small numbers. Over 30 years on a growing balance they are not. Set two expense ratios, a starting amount, and a contribution; the calculator compounds both and shows the dollar gap.
Fund A (lower ER)
3 bps$1,540,432
Fund B (higher ER)
20 bps$1,487,063
Cost of the higher expense ratio
$53,369
3.5% of Fund A's ending balance
13.0% of total contributions ($410,000)
How this is calculated
Annual nominal return is reduced by the expense ratio, then compounded monthly. Each month, the monthly contribution is added at month-end. This is the standard convention for illustrating long-horizon ER drag — it slightly understates the real cost (which accrues as a daily NAV deduction, not an annual one) by a few basis points over multi-decade horizons.
Defaults are 7% nominal, 30 years, 3 bps vs 20 bps: a cheap total-market fund against a 20 bp alternative. Over a working life the dollar gap is usually larger than the two percentages suggest.
Taxes, dividend reinvestment friction, and bid-ask spread are not modelled. For a like-for-like ER comparison those don't change the gap's shape; for cross-asset-class or cross-strategy comparisons they would, and this tool isn't the right one for that.
Illustrative projection. Past returns are not a forecast. Nothing here is investment advice.
Catalog presets pull from the live PlainIndex catalog. Expense ratios refresh annually from issuer prospectuses; see the methodology for cadence and sources.
PlainIndex publishes data and editorial commentary — nothing here is personalized investment advice. The projection is illustrative of compounding mechanics, not a forecast of any specific fund's return.