See exactly how much extra wealth you lose by investing in a regular plan instead of the direct plan of the same mutual fund — over your full SIP horizon.
Enter your monthly SIP, investment horizon, and the expense ratios of your direct and regular plans. The calculator projects the end value for both and shows you the ₹ and % wealth gap.
Same fund manager, same stocks, same strategy — only the commission embedded in the expense ratio is different. Over 20+ years, that small annual leak compounds into a substantial chunk of your final corpus.
Why Direct Plans Cost Less
Every mutual fund in India is offered in two flavours: Regular (sold via distributors, agents, brokers — who earn a trail commission paid by the AMC) and Direct (you buy from the AMC directly — no commission). The underlying portfolio, fund manager, and NAV calculation are identical. Only the expense ratio differs.
The commission in regular plans is typically 0.5–1.5% per year — paid silently from your NAV every year for as long as you hold the fund. It looks small in any single year. It compounds savagely over decades.
Fund Category
Direct ER (typical)
Regular ER (typical)
Annual Gap
Large Cap Equity
0.4–0.8%
1.5–1.9%
~1.0–1.2%
Flexi Cap / Multi Cap
0.6–1.0%
1.6–2.0%
~1.0–1.2%
Mid & Small Cap
0.7–1.1%
1.8–2.2%
~1.0–1.3%
ELSS (Tax Saver)
0.6–1.0%
1.7–2.0%
~1.0–1.2%
Hybrid / Balanced Advantage
0.4–0.9%
1.5–1.9%
~1.0–1.2%
Liquid / Overnight Debt
0.1–0.2%
0.2–0.4%
~0.1–0.2%
Ranges are illustrative based on AMFI-disclosed expense ratios. Always check your specific fund's factsheet for the exact figures.
Direct vs Regular Returns Calculator
Enter your SIP amount, horizon, and the two expense ratios — we calculate the projected wealth gap
Your monthly investment amount
How long you will continue the SIP
Underlying return before expenses. Equity: 12–14%, Hybrid: 9–11%, Debt: 6–8%
From fund factsheet — typically 0.4–1.0% for equity funds
From fund factsheet — typically 1.5–2.0% for equity funds
If you increase SIP yearly with salary growth — leave 0 if not
How the Gap Compounds Over Time
The expense ratio is deducted from your NAV every year. In year 1, the difference is small. In year 5, it starts to matter. In year 20+, it can be the difference between retiring comfortably and falling short of your goal.
The reason is mathematical: the lost expense isn't just the cost itself — it is also the future growth on that cost, compounded for decades. ₹1,000 leaked today at year 1 of a 30-year SIP would have grown to roughly ₹40,000+ at the end of the SIP at 13% per year. Multiply that by every ₹ lost each year, and you understand why direct plans matter.
The "Switch and Forget" Discipline:
If you discover your SIPs are in regular plans, switching to direct usually pays off within 2-4 years — the saved expense ratio compensates for the short-term tax hit and exit load. The longer your remaining horizon, the more compelling the switch becomes. Anyone with 10+ years left on a SIP should almost always be in direct plans.
The "Free Advisor" Myth:
Many distributors sell regular plans by saying "advice is free." It isn't. You are paying for it through the higher expense ratio every year — often 5-10x more than what a fee-only SEBI Registered Investment Advisor would charge. If you genuinely need professional advice, hire a fee-only RIA (charging ₹10-30k flat) and invest in direct plans. The math works out massively in your favour.
Read the Complete Article on Direct vs Regular
Want to understand the full story — how distributors are paid, why most platforms push regular plans, and exactly how to switch — read the full guide.
Direct plans are mutual funds you buy directly from the AMC (no distributor) — there is no commission, so the expense ratio is lower (typically 0.3-1.0% for equity funds). Regular plans are sold through distributors and brokers who get paid a trail commission — this cost is built into a higher expense ratio (typically 1.5-2.0% for equity funds). The underlying portfolio is identical; only the expense ratio differs. Over 20+ years, that 0.5-1.5% annual difference can compound into 15-30% less wealth.
Multiple ways: (1) The fund's monthly factsheet — every AMC publishes one; (2) AMFI website (amfiindia.com) — official source for all Indian mutual funds; (3) Value Research (valueresearchonline.com) and Morningstar India — show direct and regular expense ratios side by side; (4) Your investment platform — Zerodha Coin, Groww, Kuvera, and ET Money display the expense ratio in the fund details. Always check both the regular plan expense ratio (what you currently pay) and the direct plan expense ratio (what you would pay if you switched).
Gross return is the underlying portfolio's return before expenses are deducted. For Indian equity mutual funds, a reasonable long-term assumption is 12-14% gross (which translates to ~11-13% net after a 1% expense ratio). For large-cap funds, use 11-13%. For mid/small cap, use 13-15%. For balanced/hybrid funds, use 9-11%. For debt funds, use 6-8%. Don't input the historical fund return as gross — that figure is already net of expenses. Use the underlying asset class return assumption.
Yes. You have two options: (1) Switch within the same AMC — submit a switch request from your regular to direct plan of the same fund. This is treated as a redemption + new purchase, so capital gains tax applies and the holding period resets to zero for tax purposes. (2) Redeem + reinvest directly — same tax implications. Both work, but the tax impact (LTCG above ₹1.25 lakh in equity funds at 12.5% post Budget 2024) plus exit load (if applicable) need to be weighed against the long-term saving. For long horizons (10+ years remaining), switching is almost always worthwhile.
Yes — dramatically more than most investors realise. On a ₹10,000 monthly SIP over 25 years at 13% gross return, the difference between a 1.8% expense ratio (regular) and a 0.7% expense ratio (direct) is roughly ₹35-45 lakh in final corpus. The reason: expense ratio is deducted every year from your NAV, so the gap compounds along with your principal. Use the calculator to see your specific situation — the numbers will surprise you.
