Fixed Fee vs Percentage Fee Calculator NZ 2026/27
A flat annual charge and a percentage fee are not really competing structures, they are the same structure priced for different customers, and which one suits you is settled by a single number. Below a certain balance the flat charge is dreadful, because a fixed dollar amount divided by a small portfolio is a large percentage. Above that balance it is unbeatable, because the charge stops growing while the percentage alternative keeps scaling with money the provider is doing no extra work to look after. The crossing point is the flat charge divided by the gap between the two percentage rates, and it does not depend on your expected return, your horizon or how much you contribute, which makes it the one genuinely stable figure in any fee comparison. This page finds it, then does the two things a break-even on its own does not tell you. It shows what each structure costs across a range of balances expressed as an effective percentage, so you can see the flat charge falling from something punitive to something negligible as the portfolio grows. And it projects both forward across a contributing, compounding portfolio, because the annual saving is not constant: it widens every year once you are past the crossing point, which is what turns a difference of tens of dollars into thousands. The structures are yours to enter, so the same page handles a platform fee, a membership charge, an adviser's retainer against a percentage of assets, or any other place the same choice appears.
Percentage structure cost = average balance × its percentage rate.
Break-even balance = flat charge / (percentage rate − the rate alongside the flat charge). It contains no return and no horizon, so it is a property of the fee schedule alone.
Average balance = starting balance + (monthly contribution × 12) / 2, because percentage fees apply throughout the year and contributions made during it are exposed to roughly half a year of charges.
Effective percentage = total cost / average balance, which is how a flat charge becomes comparable to a percentage one.
The projection grows the balance by the contribution and the return each year, recalculates the average balance, and charges each structure on it. Fees are reported rather than deducted from the balance, so both paths grow identically and the comparison isolates the fee difference.
If the flat structure's percentage is the higher of the two, it never becomes cheaper and the calculator says so rather than reporting a meaningless negative break-even.
Excluded: transaction costs, foreign exchange, tax, and any minimum balance or fee cap the provider applies.
Not financial advice. Last verified: .
What each structure costs at your balance
| Average balance across the year | $42,400.00 |
| Flat annual charge | $120.00 |
| Plus 0.10% on the balance | $42.40 |
| Fixed-fee option, total | $162.40 |
| Percentage option at 0.50% | $212.00 |
| The fixed fee saves you | $49.60 |
| Effective rate, fixed-fee option | 0.38% |
| Effective rate, percentage option | 0.50% |
| Break-even balance | $30,000.00 |
The break-even is the flat charge divided by the gap between the two rates. It contains no assumption about returns.
The same two structures at any size
| Average balance | Fixed fee | Effective | Percentage fee | Effective | Cheaper |
|---|---|---|---|---|---|
| $10,000.00 | $130.00 | 1.30% | $50.00 | 0.50% | Percentage, by $80.00 |
| $20,000.00 | $140.00 | 0.70% | $100.00 | 0.50% | Percentage, by $40.00 |
| $30,000.00 | $150.00 | 0.50% | $150.00 | 0.50% | Identical, the crossing point |
| $40,000.00 | $160.00 | 0.40% | $200.00 | 0.50% | Fixed, by $40.00 |
| $42,400.00 | $162.40 | 0.38% | $212.00 | 0.50% | Fixed, by $49.60 |
| $100,000.00 | $220.00 | 0.22% | $500.00 | 0.50% | Fixed, by $280.00 |
| $250,000.00 | $370.00 | 0.15% | $1,250.00 | 0.50% | Fixed, by $880.00 |
Watch the effective column on the left. The flat charge falls from 1.30% to 0.15% without the fee changing at all, because only the balance it is divided by changed.
How the gap grows as you contribute
| Year | Average balance | Fixed fee | Percentage fee | Saved that year | Saved in total |
|---|---|---|---|---|---|
| 1 | $42,400.00 | $162.40 | $212.00 | $49.60 | $49.60 |
| 5 | $77,635.39 | $197.64 | $388.18 | $190.54 | $588.45 |
| 10 | $137,457.32 | $257.46 | $687.29 | $429.83 | $2,226.70 |
| 15 | $221,360.67 | $341.36 | $1,106.80 | $765.44 | $5,337.37 |
| 20 | $339,039.46 | $459.04 | $1,695.20 | $1,236.16 | $10,513.16 |
The annual saving is not constant. It grows from $49.60 to $1,236.16 because the percentage fee scales with the portfolio and the flat charge does not.
One Number Settles It
Divide the flat charge by the gap between the two percentage rates and you have the answer. On the worked example that is $120.00 divided by 0.40%, giving $30,000.00.
Below that balance the percentage fee is cheaper. Above it the flat fee is cheaper. There is nothing else to work out, and notably there is no return assumption anywhere in it.
That makes the break-even a fact about the fee schedule rather than a projection, which is unusual in this kind of comparison and worth relying on.
Worked Example: $40,000 Plus $400 A Month
Contributions raise the balance through the year, so the percentage applies to an average of $42,400.00.
Fixed-fee option: $120.00 flat plus $42.40 of percentage, totalling $162.40, an effective 0.38%.
Percentage option: $212.00, an effective 0.50%.
The fixed structure saves $49.60 in the first year, which sounds like very little and is the smallest saving you will ever get from it.
The Effective Rate Is The Thing To Watch
A flat charge only looks like a flat charge from the provider's side. From yours it is a percentage that falls as you grow.
On the worked example $120.00 plus 0.10% is an effective 1.30% at a $10,000.00 balance, 0.50% at $30,000.00, 0.22% at $100,000.00 and 0.15% at $250,000.00.
The fee never changed. Only the number underneath it did. That single column explains why the same structure is punitive for a beginner and excellent for a large investor, and why providers offering it are frequently accused of being expensive by exactly the people it is not designed for.
The Saving Is Not Constant
A break-even tells you which side of the line you are on. It does not tell you how much being on the right side is worth, and that grows every year.
On the worked example the saving is $49.60 in year one, $429.83 in year ten and $1,236.16 in year twenty. Over the full period the fixed structure costs $5,628.29 against $16,141.44, a difference of $10,513.16.
The mechanism is straightforward: the percentage fee tracks a portfolio that is compounding while the flat charge stands still. Our fund fee drag calculator shows what a fee difference does to a balance over a long horizon on its own.
Why This Structure Exists At All
It is not generosity to large investors, it is cost recovery. Administering a $500,000.00 account costs a provider very little more than a $50,000.00 one: the same statements, the same compliance, the same support.
A percentage fee earns ten times as much for nearly identical work, so a flat or capped charge simply passes that back rather than collecting it.
Which is why the structures that look expensive to a small investor are usually the cheapest available to a large one, and why the answer changes as you grow rather than being a fixed property of the provider.
Where Else This Applies
The same arithmetic settles several questions that look unrelated.
Platform membership tiers, where an annual charge unlocks lower fees. Our membership tier break-even calculator handles three tiers at once, including the currency side.
Adviser pricing, where a fixed retainer competes with a percentage of assets under management. Enter the retainer as the flat charge and the same break-even applies.
Currency conversion tiers, where a paid tier buys a better rate. Our FX fee tier break-even calculator works that in volume rather than balance.
In every case the question is the same: at what size does the fixed cost stop mattering.
Two Things This Leaves Out
Fee caps. Some percentage structures stop charging above a ceiling, which changes the shape of the comparison entirely at large balances. If yours has one, the percentage line flattens and the fixed option's advantage stops growing.
What the fee actually buys. Two structures charging the same are only equivalent if what sits underneath them is equivalent, and a fee schedule says nothing about the funds, the platform or the service. Our tracking difference calculator makes the point that a stated fee is not the same as a real cost.
Related NZ Fee Comparison Calculators
- Membership Tier Break-Even Calculator: three tiers, including the currency side.
- Fund Fee Drag Calculator: what a fee difference costs over decades.
- FX Fee Tier Break-Even Calculator: the same question by conversion volume.
- Tracking Difference Calculator: why a stated fee is not the real cost.
- One Fund vs Multi-Fund Calculator: blended cost across several funds.
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- Floor and Ceiling Calculator: round down and round up.
- Fraction Calculator: add, Subtract, Multiply & Divide with Steps.
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How to compare a flat fee against a percentage fee
- Enter both fee structures. A flat charge often comes with a small percentage alongside it rather than replacing the percentage entirely, so there is room for both. Set anything that does not apply to zero.
- Enter the balance and what you add. Percentage fees apply to the balance throughout the year, so regular contributions raise what you pay. The calculation uses the average balance rather than the starting figure.
- Read the break-even balance. This is the single number the decision turns on. It is the flat charge divided by the gap between the two percentage rates, and it does not depend on your horizon or your return.
- Compare your balance against it. Below the break-even the percentage fee is cheaper, because a flat charge on a small balance is a large percentage. Above it the flat fee wins and keeps winning by more.
- Look at the effective percentage. A flat charge expressed as a percentage of the balance falls as the portfolio grows. That is the whole mechanism, and seeing it as a percentage makes it directly comparable.
- Project it forward. If you are contributing regularly you will cross the break-even at some point, and the table shows the cumulative difference by then. The gap widens every year once you are past it.