TER (Total Expense Ratio)
Also known as: total cost ratio, ongoing charges, expense ratio, management fee
The TER is the annual cost ratio of a fund or ETF — it tells you what percentage of your invested money is deducted each year for management, licensing, and operations. For ETFs typically 0.1–0.5%, for actively managed funds often 1.5–2%.
Why is the TER so important?
Small differences, big impact: With €100,000 invested over 30 years, a TER of 0.2% costs about €18,000 total. A TER of 1.5% costs about €120,000. That is €100,000 difference — just because of costs. Therefore: cheap ETFs (TER under 0.3%) are almost always the better choice over expensive funds.
Where do you find the TER?
The TER is listed in every ETF factsheet and on comparison sites like justETF or extraETF. Popular ETFs and their TER: MSCI World (about 0.2%), FTSE All-World (about 0.22%), S&P 500 (about 0.07%). The TER is not charged separately — it is already factored into the price.
BudgetHeld says
In BudgetHeld, you see your monthly amount under Investing. How much of that actually arrives depends on your ETF TER. Tip: choose an ETF with TER under 0.3% — it saves you a small fortune over the decades.
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Compound Interest Calculator →Written by David El Dib — Financial expert & founder of MoneyTalk