# What will my mutual fund be worth?

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.

- Page: https://www.acalculator.org/finance/mutual-fund-calculator
- JSON spec: https://www.acalculator.org/finance/mutual-fund-calculator.json
- Version: c5c3a3eccf3e

## Default answer

Example with the default inputs (Initial investment $10,000.00, Added each month $200.00, Expected return (yearly) 7%, Expense ratio 0.5%, Years 20, Front-end load 0%, Back-end load (when you sell) 0%): $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.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| initial | Initial investment | The amount you invest at the start, before any sales load. |
| monthly | Added each month | An amount invested at the end of every month, before any sales load. Leave it empty or 0 for none. |
| ret | Expected return (yearly) | The yearly return of the fund’s investments before its expenses. Type your own estimate. |
| er | Expense ratio | The fund’s total annual operating expenses as a percent of assets, from its prospectus fee table. |
| years | Years | How many years you hold the fund. |
| front | Front-end load | A sales charge taken from every purchase, as a percent of the amount invested. |
| back | Back-end load (when you sell) | A deferred sales charge taken when you sell, as a percent of the value at the end. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| value | Value after fees | The value at the end minus the back-end load: what you would get if you sold. |
| paidIn | Money put in | The initial investment plus every addition. |
| gain | Gain | The value after fees minus the money put in. |
| expenses | Expenses paid | All the monthly expenses added up. |
| loads | Sales loads paid | Every front-end load plus the back-end load. |
| noFees | Value with no fees | The same money at the same return with no loads and no expenses. |
| feeCost | What the fees cost you | The value with no fees minus the value after fees: the fees plus the return they would have earned. |

## 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.

## Worked examples

1. initial = $100,000.00, monthly = $0.00, ret = 4%, er = 1%, years = 20 gives value = $179,379.03, noFees = $219,112.31, expenses = $27,224.98. 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).
2. initial = $10,000.00, monthly = $0.00, ret = 5%, er = 0%, front = 5.75%, back = 0%, years = 1 gives value = $9,896.25, loads = $575.00, 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).
3. initial = $10,000.00, monthly = $200.00, ret = 7%, er = 0.5%, front = 0%, back = 1%, years = 10 gives value = $51,474.59, paidIn = $34,000.00, expenses = $1,440.29, loads = $519.95. Source: SEC Investor Bulletin, Mutual Fund Fees and Expenses: expense ratio and deferred sales charges (https://www.sec.gov/files/ib_mutualfundfees.pdf).

## FAQ

### How do mutual fund fees affect my returns?

Fees come out of your money every year, and the money they take can no longer grow. The SEC’s example: $100,000 growing 4% a year is worth about $208,000 after 20 years with a 0.25% yearly fee, about $198,000 with 0.50%, and about $179,000 with 1%. The calculator shows the same comparison for your numbers as “What the fees cost you”.

### What is an expense ratio?

The expense ratio is the fund’s total annual operating expenses (management fee, distribution or 12b-1 fees, and other expenses) as a percent of its assets. It is not billed to you: the fund takes it from its assets, so it lowers your return. You find it in the fee table at the front of the prospectus.

### What is a front-end load?

A front-end load is a sales charge taken from each purchase. With a 5.75% front-end load, $10,000 buys only $9,425 of fund shares; the other $575 goes to the broker. Many funds lower the load for large purchases (breakpoints); this calculator uses one rate for every purchase.

### What is a back-end load?

A back-end load, or deferred sales charge, is taken when you sell. It often falls each year you hold the fund and disappears after several years; enter the rate that will apply when you sell. The calculator takes it as a percent of the value at the end.

### What return should I expect from a mutual fund?

No one knows: returns go up and down, and past returns do not predict future ones. The calculator keeps the return you type the same every year so you can compare fees and time; try a lower and a higher return to see a range. It never looks up a fund’s past returns.

### How is this different from the index fund calculator?

This page adds front-end and back-end sales loads and compares the fund with the same money and no fees at all. The index fund calculator compares a low-cost index fund with a fund that charges a higher expense ratio.

## 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