Finance · Free tool
MF Expense Ratio Impact
Direct plans (0.3-0.7% expense ratio) beat regular plans (1.5-2.5%) by lakhs over decades. SEBI-mandated cap is 1.05% for equity above ₹10,000 cr AUM. Picking direct over regular is the easiest +1% return upgrade.
₹20,000
20 yrs
12%
1.5%
Direct: ~0.5%, Regular: ~1.5%, Active: up to 2%
Lost to fees
₹36,31,023
18.2% of corpus
Corpus before fees₹1,99,82,958
Corpus after fees₹1,63,51,936
FAQ
Direct vs Regular?
Direct = no broker commission, ~1% lower expense ratio. Compounded over 20+ years, beats regular by 30-40% of corpus.
Where to buy direct plans?
Coin (Zerodha), Groww, INDmoney, MFCentral, AMC sites. Or use a SEBI-RIA fee-only advisor.
Switch existing regular to direct?
Yes — exit and re-enter. Tax: capital gains on sale; reinvestment restarts holding clock. Best to exit at LTCG.