{
  "id": "mutual-fund",
  "version": "c5c3a3eccf3e",
  "status": "published",
  "name": "Mutual Fund Calculator",
  "question": "What will my mutual fund be worth?",
  "summary": "Computes the value of a mutual fund investment with monthly additions after the expense ratio and front-end and back-end sales loads, and how much the fees cost against the same money with no fees.",
  "category": "finance",
  "subcategory": "investing",
  "url": "https://www.acalculator.org/finance/mutual-fund-calculator",
  "markdown": "https://www.acalculator.org/finance/mutual-fund-calculator.md",
  "kind": "schedule",
  "method": "Each month: return = value × ((1 + R)^(1/12) − 1); expense = (value + return) × expense ratio ÷ 12; the addition is invested after the front-end load. At the end the back-end load is taken from the value.",
  "assumptions": [
    "The return and the expense ratio stay the same every year; real returns go up and down.",
    "Additions are made at the end of each month; each purchase pays the front-end load.",
    "The back-end load is a percent of the value when you sell.",
    "Taxes, account fees and breakpoints (lower loads for larger purchases) are not included. This is an estimate, not investment advice."
  ],
  "inputs": {
    "$schema": "https://json-schema.org/draft/2020-12/schema",
    "type": "object",
    "properties": {
      "initial": {
        "title": "Initial investment",
        "description": "The amount you invest at the start, before any sales load.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 1000000000
      },
      "monthly": {
        "title": "Added each month",
        "description": "An amount invested at the end of every month, before any sales load. Leave it empty or 0 for none.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 100000000
      },
      "ret": {
        "title": "Expected return (yearly)",
        "description": "The yearly return of the fund’s investments before its expenses. Type your own estimate.",
        "type": "number",
        "x-unit": "percent",
        "minimum": -50,
        "maximum": 50
      },
      "er": {
        "title": "Expense ratio",
        "description": "The fund’s total annual operating expenses as a percent of assets, from its prospectus fee table.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 10
      },
      "years": {
        "title": "Years",
        "description": "How many years you hold the fund.",
        "type": "integer",
        "minimum": 1,
        "maximum": 60
      },
      "front": {
        "title": "Front-end load",
        "description": "A sales charge taken from every purchase, as a percent of the amount invested.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 10
      },
      "back": {
        "title": "Back-end load (when you sell)",
        "description": "A deferred sales charge taken when you sell, as a percent of the value at the end.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 10
      }
    }
  },
  "outputs": {
    "value": {
      "label": "Value after fees",
      "description": "The value at the end minus the back-end load: what you would get if you sold.",
      "format": "money"
    },
    "paidIn": {
      "label": "Money put in",
      "description": "The initial investment plus every addition.",
      "format": "money"
    },
    "gain": {
      "label": "Gain",
      "description": "The value after fees minus the money put in.",
      "format": "money"
    },
    "expenses": {
      "label": "Expenses paid",
      "description": "All the monthly expenses added up.",
      "format": "money"
    },
    "loads": {
      "label": "Sales loads paid",
      "description": "Every front-end load plus the back-end load.",
      "format": "money"
    },
    "noFees": {
      "label": "Value with no fees",
      "description": "The same money at the same return with no loads and no expenses.",
      "format": "money"
    },
    "feeCost": {
      "label": "What the fees cost you",
      "description": "The value with no fees minus the value after fees: the fees plus the return they would have earned.",
      "format": "money"
    }
  },
  "defaultAnswer": {
    "inputs": {
      "initial": 10000,
      "monthly": 200,
      "ret": 7,
      "er": 0.5,
      "years": 20,
      "front": 0,
      "back": 0
    },
    "outputs": {
      "value": 130574.41202364016,
      "paidIn": 58000,
      "gain": 72574.41202364016,
      "expenses": 5808.90209543092,
      "loads": 0,
      "noFees": 140204.11993753622,
      "feeCost": 9629.707913896054
    },
    "text": "$10,000.00 plus $200.00 a month, at 7% a year with a 0.5% expense ratio, is worth $130,574.41 after 20 years."
  },
  "examples": [
    {
      "given": {
        "initial": 100000,
        "monthly": 0,
        "ret": 4,
        "er": 1,
        "years": 20
      },
      "expect": {
        "value": 179379.0329121594,
        "noFees": 219112.3143033446,
        "expenses": 27224.982254703365
      },
      "source": "SEC Investor Bulletin, How Fees and Expenses Affect Your Investment Portfolio: about $179,000 after 20 years with a 1% fee (https://www.investor.gov/sites/default/files/ib_fees_expenses.pdf); Python 3 cross-check"
    },
    {
      "given": {
        "initial": 10000,
        "monthly": 0,
        "ret": 5,
        "er": 0,
        "front": 5.75,
        "back": 0,
        "years": 1
      },
      "expect": {
        "value": 9896.25,
        "loads": 575,
        "gain": -103.75
      },
      "source": "SEC Investor Bulletin, Mutual Fund Fees and Expenses: a front-end load reduces the amount invested (https://www.sec.gov/files/ib_mutualfundfees.pdf); hand calculation in content.mdx",
      "tolerance": 1e-12
    },
    {
      "given": {
        "initial": 10000,
        "monthly": 200,
        "ret": 7,
        "er": 0.5,
        "front": 0,
        "back": 1,
        "years": 10
      },
      "expect": {
        "value": 51474.59217521291,
        "paidIn": 34000,
        "expenses": 1440.2942300192485,
        "loads": 519.9453755072011
      },
      "source": "SEC Investor Bulletin, Mutual Fund Fees and Expenses: expense ratio and deferred sales charges (https://www.sec.gov/files/ib_mutualfundfees.pdf); Python 3 cross-check"
    }
  ],
  "sources": [
    "U.S. Securities and Exchange Commission, Investor Bulletin: How Fees and Expenses Affect Your Investment Portfolio. https://www.investor.gov/sites/default/files/ib_fees_expenses.pdf",
    "U.S. Securities and Exchange Commission, Investor Bulletin: Mutual Fund Fees and Expenses (sales loads, deferred sales charges, expense ratio). https://www.sec.gov/files/ib_mutualfundfees.pdf",
    "U.S. Securities and Exchange Commission, Investor.gov: Mutual Funds. https://www.investor.gov/introduction-investing/investing-basics/investment-products/mutual-funds-and-exchange-traded-1"
  ],
  "related": [
    "index-fund",
    "investment",
    "compound-interest",
    "rate-of-return",
    "roi"
  ],
  "changelog": []
}