Expense Ratio Calculator: Calculate Fund Expense Ratio (ER)

Our Expense Ratio Calculator helps investors understand the cost of owning mutual funds, ETFs, and other investment funds. Enter the annual expenses and fund value to instantly calculate the expense ratio — the percentage of fund assets spent on operating expenses each year. This is crucial for evaluating fund costs and making informed investment decisions.

An Expense Ratio (ER) is the annual cost of operating a mutual fund or investment fund, expressed as a percentage of the fund's total assets under management. It includes management fees, administrative costs, and other operating expenses. The expense ratio directly impacts investor returns — lower expense ratios mean more of your money stays invested.

1. Enter the annual expenses of the fund (total operating costs per year).
2. Enter the fund's or asset's total value.
3. Click Calculate to see the expense ratio percentage.
4. Use this metric to compare fund costs and evaluate investment options.

Expense ratios are crucial for investors because they compound over time:

• Low expense ratios (0.03%-0.50%): Index funds and passive management strategies
• Moderate expense ratios (0.50%-1.50%): Actively managed funds with higher trading activity
• High expense ratios (1.50%+): Specialized funds or those with higher fee structures
• Impact over time: A 1% difference in expense ratio can result in thousands of dollars difference over decades

Here are typical expense ratio scenarios:

• Index Fund: $50,000 fund with $15 annual expenses = 0.03% expense ratio
• Managed Mutual Fund: $500,000 fund with $5,000 annual expenses = 1.00% expense ratio
• Specialty Fund: $1,000,000 fund with $25,000 annual expenses = 2.50% expense ratio
• High-Cost Fund: $100,000 fund with $3,000 annual expenses = 3.00% expense ratio

Lower expense ratios benefit investors in several ways:

• More money remains invested and compounds over time
• Reduces drag on investment returns year over year
• Over 30+ years, expense ratio differences can result in significant wealth differences
• Passive/index funds typically have much lower expense ratios than active management
• Compare expense ratios before selecting investment funds

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