Final gap between the two portfolios
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Index portfolio · final value
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Expensive fund · final value
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Extra paid in fees
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Total contributed
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The two paths, year by year
Index fund (low cost)
Expensive fund
| Year | Index fund (€) | Expensive fund (€) | Difference (€) | % less wealth |
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Deterministic model: each portfolio's net return is the gross market return minus its expense ratio (index fund ≈ gross − 0.15 %; expensive fund ≈ gross − 2.40 %). With the default values it reproduces, approximately, the example from the book: 300 €/month for 25 years, with the 2.25-point fee gap that separates an index fund from a typical bank fund, comes to roughly 64,000 € of final difference. The full cost chain of an index fund should rarely exceed 0.5 % a year. Tax is not included; compare with the Spanish capital gains calculator (in Spanish).