Expense Ratio Calculator

Annual fees are modeled as a percentage of assets expressed as an annual expense ratio. The calculator computes both the simple annual fee (current assets × expense ratio) and the accumulated effect of that drag on investment growth over time by reducing the gross return by the expense ratio.

Future-value calculations apply standard compound interest formulas for both lump sums and regular annual contributions. The gross scenario uses the stated expected return; the net scenario reduces that return by the expense ratio to approximate the long-run effect of ongoing fees.

For comparisons, the same gross return assumption is used for each fund; only the expense ratio differs. All outputs are rounded and include percent and currency summaries. Edge cases (zero return, negative rates) are handled by algebraic forms but may require careful interpretation.

Example 1: $10,000 at 6% expected return with 0.50% expense ratio over 20 years and no contributions. Annual fee (first year) = $50. Cumulative difference in final value can exceed several thousand dollars depending on the horizon.

Example 2: Compare fund A (0.50%) vs fund B (0.20%) with $5,000 current value, $2,000 annual contributions, 7% expected return, over 30 years to illustrate compounding differences.