Expense Ratio
An expense ratio is the annual fee a mutual fund or ETF charges, shown as a percentage of your invested money. A 0.05% ratio costs $5 a year per $10,000; a 1% ratio costs $100. It's deducted automatically, so it's easy to ignore — and over decades even small differences compound into serious money.
The percentage disguises the size. Take $100,000 growing at 7% before fees for 30 years: at a 0.05% expense ratio it reaches about $750,600, and at 1% about $574,300. The 0.95-point difference costs roughly $176,300 — around 23% of the larger outcome, for the same money and the same market. The fee is deducted from the fund's assets rather than billed, so it never appears on a statement and nothing prompts you to notice it. Broad index funds commonly charge under 0.10%. It is worth checking the ratio on every holding, and it is the one input to your returns that is knowable in advance and entirely under your control.
Put it to work
Investment Calculator
Project an investment portfolio's growth with monthly contributions — final value, your money vs market growth, and the year-by-year path.
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Measure the return on any investment: total gain, total return (ROI), and the annualized return (CAGR) that lets you compare deals held for different lengths of time.