This calculator estimates the effect of investment charges by showing how fund fees, platform fees and other ongoing costs can reduce a portfolio over time. It is designed to make fee drag easier to understand, especially when comparing small annual differences over long periods. The figures are illustrative and depend on the assumptions entered, so they should be read as an educational comparison rather than a prediction. Investment values can fall as well as rise and capital is at risk, even where fees appear modest.
What this calculator assumes
- The calculator uses the fee inputs provided and applies them as an illustration rather than a live market quote.
- Any growth rate used is assumed and does not reflect guaranteed or expected returns.
- The calculation does not include tax, inflation or product-specific charges unless those are entered separately.
- Investment values can go down as well as up and capital is at risk.
What the fee comparison shows
The result highlights how annual charges may affect the amount left invested each year and the value available later on. Fund fees are the costs charged by the investment product itself, while platform fees are the charges taken by the account or service provider. Over time, these costs can reduce the amount that remains to compound. The calculator is useful for comparing scenarios where the headline difference looks small but the long-term impact becomes more noticeable because charges are repeated year after year.
Why small differences can compound
A fee difference of only a few tenths of a per cent may seem minor in a single year, but over many years it can create a meaningful gap in outcomes. That is because fees reduce the amount that stays invested, and future growth is then applied to a smaller base. The effect is often called fee drag. The calculator helps show that charges are not just a one-off cost, but something that can influence compounding across the full investment period. It remains a simplified illustration, not a quote or a performance forecast.
Useful official sources
FAQs
What is fee drag?
Fee drag is the reduction in investment growth caused by ongoing charges. Because fees reduce the amount left invested, they can also reduce future compounding.
Why compare platform fees and fund fees separately?
They are different costs charged by different parts of the investment setup. Looking at them separately can make it easier to understand where the total ongoing cost comes from.