The Total Cost Ratio (TCR) is an all-in measure of super fees that captures every cost associated with your investment option — including costs that don’t appear on your statement. It is the most complete basis for comparing super fund costs.
What the TCR Includes
The TCR adds together:
- Administration fee (percentage component)
- Investment fee
- Indirect cost ratio (ICR) — costs embedded in investment returns
- Performance fees (if applicable, based on recent estimates)
It does not include:
- Fixed dollar administration fees (these are not balance-based and are handled separately)
- Buy/sell spreads (transaction-based, not ongoing)
- Insurance premiums (separate from investment costs)
- Advice fees (member-specific)
Formula:
TCR = Admin fee % + Investment fee % + ICR % + Performance fee %
Why TCR Is More Useful Than Headline Fees
Many fund advertisements and comparison tables show only the administration fee or investment fee. The TCR forces inclusion of all components.
Example:
| Fund | Admin fee | Investment fee | ICR | Performance fee | TCR |
|---|---|---|---|---|---|
| Fund X | 0.10% | 0.30% | 0.05% | 0.00% | 0.45% |
| Fund Y | 0.10% | 0.20% | 0.20% | 0.15% | 0.65% |
Fund Y’s investment fee appears lower, but its TCR is 0.20% higher than Fund X’s — equivalent to $400/year on a $200,000 balance.
Where to Find the TCR
In the PDS: The “Fees and Costs” table in the PDS should disclose each component. Adding them gives the TCR.
On the APRA heatmap: APRA’s heatmap shows a combined fee metric that approximates the TCR for MySuper products. It accounts for the fixed admin fee by converting it to a percentage equivalent at a $50,000 reference balance.
On the YourSuper comparison tool: The fee column on the YourSuper tool (moneysmart.gov.au) shows total fees in dollar terms for a $50,000 balance — this reflects the TCR plus the fixed admin fee, standardised.
TCR vs Total Annual Fee
These terms are sometimes used interchangeably, but there’s a nuance:
- Total Annual Fee = TCR (balance-based costs) + fixed admin fee (converted to a dollar amount at your actual balance)
- TCR = percentage-based costs only
For the most accurate comparison at your actual balance:
Total Annual Fee = (TCR × your balance) + fixed admin fee
Interpreting Your TCR
| TCR range | Assessment |
|---|---|
| Below 0.50% | Excellent — typically large index or industry fund options |
| 0.50%–0.80% | Good — competitive for diversified active management |
| 0.80%–1.20% | Average — typical retail fund or enhanced index option |
| 1.20%–1.70% | High — scrutinise whether net returns justify the cost |
| Above 1.70% | Very high — strong justification needed |
Note: Some options (alternatives, ESG screens, private assets) legitimately carry higher TCRs due to the cost of the underlying assets. Always compare like-for-like (balanced vs balanced, not balanced vs high growth).
TCR Limitations
- The TCR does not capture the value of what you get for the fee (investment quality, insurance, advice access)
- Performance fees embedded in the ICR are estimates — actual TCR in a high-return year may be higher
- The TCR is a backward-looking average; future fees may differ
Always use TCR alongside performance data (net returns) — a fund with a higher TCR may still deliver better outcomes after all costs if their investment performance is superior.
For more: How Are Super Fees Calculated?, Indirect Cost Ratio, Performance Fees in Super, Super Fee Calculator, APRA Heatmap Guide. For advice on your situation, speak with a licensed financial adviser via MoneySmart.