Impact of 1% Calculator
How much does a 1% fee — or 1% better return — really matter?
The drag compounds just like returns do — a 1% annual difference barely shows in year one and quietly becomes lakhs over decades. The most common real-world 1% in India: the expense-ratio gap between a regular mutual-fund plan (bought through a distributor) and the direct plan of the exact same fund, which typically runs 0.5-1.5% a year. Same fund, same manager, same portfolio — different take-home.
Tax angle: fees hurt twice — the drag reduces your gains, but LTCG tax (12.5% on equity gains beyond ₹1.25L/yr) is charged on what's left, so the government shares your gains while the fee is yours alone. And unlike tax, the fee applies to your whole balance every year, gains or not. Checking a fund's expense ratio takes 10 seconds on the factsheet; this calculator shows what those 10 seconds are worth.