Direct vs Regular Mutual Fund Calculator
Enter your SIP, the fund's return before costs and the expense ratio of each plan. You see what the same fund is worth as a direct plan and as a regular plan, and how much the higher cost takes from you over the years.
By Hardik Vegad, founder of WealthGamma · Last updated
Direct plan ends ahead by
₹13.15L
Over 20 years, a 1% higher expense ratio takes 12.6% of your final value.
Regular
1.7% cost
Return after costs
11.3%
Invested
₹24,00,000
Total value
₹90,92,561
Direct
0.7% cost
Return after costs
12.3%
Invested
₹24,00,000
Total value
₹1,04,07,209
Direct and regular plan, year by year
- Direct plan
- Regular plan
- Invested
Year-by-year tableShowHide
| Year | Invested | Regular | Direct | Gap |
|---|---|---|---|---|
| 1 | ₹1,20,000 | ₹1,27,605 | ₹1,28,303 | ₹699 |
| 2 | ₹2,40,000 | ₹2,70,399 | ₹2,73,309 | ₹2,909 |
| 3 | ₹3,60,000 | ₹4,30,192 | ₹4,37,190 | ₹6,998 |
| 4 | ₹4,80,000 | ₹6,09,007 | ₹6,22,406 | ₹13,398 |
| 5 | ₹6,00,000 | ₹8,09,108 | ₹8,31,732 | ₹22,623 |
| 6 | ₹7,20,000 | ₹10,33,029 | ₹10,68,307 | ₹35,278 |
| 7 | ₹8,40,000 | ₹12,83,606 | ₹13,35,679 | ₹52,073 |
| 8 | ₹9,60,000 | ₹15,64,011 | ₹16,37,856 | ₹73,845 |
| 9 | ₹10,80,000 | ₹18,77,796 | ₹19,79,370 | ₹1,01,574 |
| 10 | ₹12,00,000 | ₹22,28,934 | ₹23,65,341 | ₹1,36,408 |
| 11 | ₹13,20,000 | ₹26,21,871 | ₹28,01,557 | ₹1,79,686 |
| 12 | ₹14,40,000 | ₹30,61,583 | ₹32,94,557 | ₹2,32,974 |
| 13 | ₹15,60,000 | ₹35,53,639 | ₹38,51,735 | ₹2,98,095 |
| 14 | ₹16,80,000 | ₹41,04,270 | ₹44,81,444 | ₹3,77,174 |
| 15 | ₹18,00,000 | ₹47,20,447 | ₹51,93,126 | ₹4,72,679 |
| 16 | ₹19,20,000 | ₹54,09,974 | ₹59,97,453 | ₹5,87,479 |
| 17 | ₹20,40,000 | ₹61,81,583 | ₹69,06,484 | ₹7,24,902 |
| 18 | ₹21,60,000 | ₹70,45,044 | ₹79,33,850 | ₹8,88,806 |
| 19 | ₹22,80,000 | ₹80,11,291 | ₹90,94,955 | ₹10,83,664 |
| 20 | ₹24,00,000 | ₹90,92,561 | ₹1,04,07,209 | ₹13,14,648 |
What is the difference between direct and regular mutual funds?
Only the cost. A direct plan and a regular plan are two versions of the same fund: same fund manager, same stocks and bonds, same risk. The regular plan's expense ratio includes the commission the fund house pays your distributor every year. The direct plan has no commission, so it charges less.
That cost comes out of the fund's value a little every day, so the regular plan's NAV grows slower. You never see a bill for it. Every fund has had a direct plan since 1 January 2013, when SEBI made it compulsory.
How much does a 1% higher expense ratio cost?
About 13% of your final value over 20 years. A ₹10,000 monthly SIP in a fund that earns 13% before costs grows to ₹1.04 Cr in a direct plan charging 0.7%, and to ₹90.93L in a regular plan charging 1.7%. The gap is ₹13,14,648, on ₹24,00,000 invested.
The longer you stay, the more it takes, because the lost money would have compounded too:
| Regular plan costs more by | 10 years | 20 years | 30 years |
|---|---|---|---|
| 0.5% a year | ₹69,422 (3%) | ₹6.82L (7%) | ₹39.87L (11%) |
| 1% a year | ₹1.36L (6%) | ₹13.15L (13%) | ₹75.21L (20%) |
| 1.5% a year | ₹2.01L (8%) | ₹19L (18%) | ₹1.07 Cr (28%) |
₹10,000 a month, 13% a year before costs, direct plan at 0.7%. In brackets: the share of the direct plan's final value.
Over 30 years, a 1% gap takes ₹75.21L, about 20% of what you would have had. A one-time ₹5 lakh left for 20 years ends ₹8.33L lower in the regular plan.
How do you check if your fund is direct or regular?
Read the scheme name on your statement. It carries the word Direct or Regular, as in "Flexi Cap Fund, Direct Plan, Growth". If you bought through a bank, a broker's relationship manager or an agent, it is almost always regular.
- On your CAS. The consolidated account statement from CAMS or KFintech shows the distributor's ARN code against a regular plan folio. A direct folio shows "Direct" there.
- On the factsheet. The fund's monthly factsheet lists the expense ratio of both plans. Use those two numbers in the calculator above.
- By the NAV. The direct plan's NAV is the higher of the two.
How do you switch from a regular plan to a direct plan?
You place a switch request with the fund house, or sell the regular units and buy the direct plan. Either way it counts as a sale and a fresh purchase, so three costs can apply:
- Capital gains tax. For equity funds, gains on units held over a year are taxed at 12.5% above ₹1.25 lakh a year. Gains on units held a year or less are taxed at 20%.
- Exit load. Many equity funds charge about 1% on units sold within a year of buying.
- ELSS lock-in. Tax-saving fund units can't be switched until they complete 3 years.
So don't move everything in one day. Start new SIPs in the direct plan right away, since that costs nothing. Then move the old units in batches, keeping each year's gains within the ₹1.25 lakh that is tax free. The tax harvesting calculator shows how much you can move each year without paying tax.
When is a regular plan worth paying for?
When the advice you get is worth more than the cost. A good distributor picks suitable funds, handles the paperwork, and talks you out of selling in a crash. One panic sale avoided can be worth more than years of commission.
It is not worth it if nobody has reviewed your funds in years, or if you already choose them yourself. Then you are paying for a service you don't use. Ask your distributor what you get each year for the money, and compare it with the number above.
How is the direct vs regular difference worked out?
Direct plan return = Return before costs − Direct expense ratio
Regular plan return = Return before costs − Regular expense ratio
Gap = Direct plan value − Regular plan value
With 13% before costs, the direct plan grows at 12.3% and the regular plan at 11.3%. Each side is then worked out like a normal SIP, so the numbers match the SIP calculator at the same return.
The gap is more than the extra fees alone. It also counts the growth those fees would have earned if they had stayed invested.
What does a direct vs regular calculator not account for?
It assumes both costs stay the same for the whole period. In real life:
- Expense ratios change. Funds revise them, and they usually fall as a fund grows bigger. Check the factsheet once a year.
- Returns are not steady. The fund won't earn the same return every year. The gap in rupees moves with the market; the gap in percent a year does not.
- Tax. Gains are taxed when you sell, in both plans.
- The value of advice. If a distributor's guidance makes you invest more or stay invested, that doesn't show up here.
Raising your SIP every year widens the gap further. Try it in the step up SIP calculator.
Frequently asked questions
Is a direct plan better than a regular plan?
On cost, yes. Both plans hold the same portfolio, but the direct plan charges less, so it always ends higher. A ₹10,000 monthly SIP for 20 years ends about ₹13.15L higher in the direct plan when its expense ratio is 1% lower.
How much more does a direct plan return?
The difference in expense ratios, every year. For equity funds that is usually about 0.5% to 1% a year, and less for debt funds. On a 20-year SIP, 1% a year adds up to about 13% of your final value.
Do direct and regular plans hold the same stocks?
Yes. They are two plans of one scheme, with the same fund manager and the same portfolio. Only the expense ratio differs, and so the NAV.
Why is the NAV of a direct plan higher?
Because less is taken out of it in costs every day. Both plans started at the same NAV, and the direct plan has pulled ahead a little every year since.
How do I know if my mutual fund is direct or regular?
Read the scheme name on your account statement. It says Direct or Regular. On a consolidated account statement (CAS), a regular plan folio also shows the distributor's ARN code, and a direct folio shows Direct.
Is there tax on switching from regular to direct?
Yes. A switch counts as selling the regular units and buying direct ones. Gains on equity fund units held over a year are taxed at 12.5% above ₹1.25 lakh a year, and at 20% if held for a year or less. An exit load may apply on recent units.
Can I hold both direct and regular plans?
Yes. Many investors leave old regular units where they are, start new SIPs in the direct plan, and move the old units across in batches to keep the tax low.