There is no impact on performance (or at least it's not noticeable).
The disk is encrypted with or without FileVault being on. FileVault adds the following ( from Use FileVault to encrypt your Mac startup disk - Apple Support ):
When FileVault is turned on, your Mac requires your user account password to unlock your built-in startup disk and allow your Mac to finish starting up. No user account is permitted to log in automatically.
The following from https://www.macworld.com/article/344206/how-to-encrypt-a-mac-storage-device.html may also help:
Intel Macs with a T2 security chip: Most Intel Mac models released starting in 2018 have a T2 security chip, which is set to always encrypt the drive, even if FileVault is disabled. (There’s a way to disable this, but there’s no reason to.) The Secure Enclave handles all the necessary pieces. FileVault on a T2-equipped Mac protects a Mac’s data at a cold startup.