Any tool created to make one’s financial life easier and more organized is a tool I want to learn about. The busy schedule I (and most people) keep requires a serious look into any resource created in order that my busy life can be more streamlined and less hectic. It was this promise of simplifying my finances that led me to do this review of Personal Capital. As I learned more about Personal Capital, the more I learned, the more I loved. Personal Capital is similar to Mint, but with a valuable added benefit: the focus being not just on your spending and cash flow, but on helping you manage your investments and net worth as well. The software they offer, like Mint, is free. However, they have an additional feature for customers with a net worth of at least $250,000 in cash and/or retirement assets: the benefit of financial advisor and financial planner services. It’s a one-stop shop to view and manage all of your accounts in one place, with the added benefit of having financial advisors and financial planners available to you if you need or want to use that part of what Personal Capital offers.
So how exactly does Personal Capital work?
The first step is to set up your cash accounts, your non-retirement accounts and your retirement accounts to be viewable from the Personal Capital site. Their ultra-secure system ensures that there are multiple, easy-to-follow secure steps for clients to take in order to make sure that only the client themselves and Personal Capital authorized staff members have the ability to view and analyze the client’s financial information with the help of Personal Capital’s easy-to-understand technology.
Screenshot of a Personal Capital account
Once your account at Personal Capital is set up, you can check in daily to see nearly every aspect of your financial picture: your income, your spending, your investment totals, your asset amounts, your liability amounts and your total net worth. Personal Capital’s system makes asset and day-to-day money management easy and convenient. With a few clicks of your mouse, you can see where you’re at, and where you need to be to reach the financial and retirement goals you have set, all without leaving the Personal Capital website.
The History of Personal Capital
Personal Capital has an impressive team of leaders at the helm of this rapidly growing company. The CEO and founder, Bill Harris, has a resume’ that includes running both PayPal and Intuit, gaining him over two decades of working to build successful financial technology systems for large and well-respected companies. Amy Hong, Personal Capital’s Chief Compliance Officer, has held senior compliance positions at big-name companies including ING, Barclays Global and Ernst & Young.
The remainder of the leadership team also has an impressive amount of financial and technological expertise in a wide variety of career titles and with a wide variety of well-known companies. Knowing that the Personal Capital founders took the time to develop an experienced and educated team of leaders ensures confidence that the entire team at Personal Capital has been hand-picked with the customer’s and the company’s best interests in mind. It’s evident that Personal Capital intends to be around for the long haul.
So what exactly can Personal Capital do for you? The most beneficial feature of Personal Capital is that you can get a thorough look at your investments, bank accounts, and household finances, all in one place, for free.
There are a number of great features to help make you financial life much easier.
This will tell you if you are allocated appropriately based on your investment profile. For instance, if you haven’t re-balanced your portfolio in a while, it is possible that you are overweight in equities due to the growth being higher in that asset class than others. If you click on the “Investment Checkup” in the “Investing” tab. It may something like your asset allocation may be too aggressive and that adding bonds would increase diversification.
Retirement Fee Analyzer
This is a tool that will analyze the fees you are paying for your retirement accounts like your 401k, how those fees will impact your retirement account growth over the years, and with the availability of their free online resources, it helps you make an informed decision on how to invest for retirement based on your individual needs and goals.
This tracks your performance and then you can compare that performance to benchmarks like the S&P 500.
This app is very comprehensive, easy to use and did I mention that it is free?
Review of Personal Capital’s Wealth Management
For clients with a larger net worth (over $250,000) Personal Capital also offers Wealth Management. The set fees that Personal Capital charges are amazingly reasonable.
- First $1 Million: 0.89%
- First $3 Million: 0.79%
- Next $2 Million: 0.69%
- Next $5 Million: 0.59%
- Over $10 Million: 0.49%
Because Personal Capital charges a set, low fee for their advisory services, you can be assured that your Investment Advisor at Personal Capital won’t make investment suggests to you based on which funds and products pay a higher commission, but instead will make educated recommendations based on what they feel is the best product or service for your individual portfolio and your investment goals. It’s the income from the high-end portfolio clients that allow Personal Capital to offer their Financial Software free to all clients, regardless of net worth. It’s in this way that Personal Capital can help every single client work toward a more stable financial future, while still ensuring that they’re a viable and profitable company.
From what we have seen so far, Personal Capital practically and enigmatically saves you the trouble of wasting your gas and time to meet with a wealth management advisor to provide you investment advice by providing you the capability to manage all your tasks through their mobile app. And did we mention it was free of charge? Yes, really. Free of charge.
You’re asking yourself: The mobile app may be free but doesn’t that make Personal Capital’s wealth management service(s) that much higher? Yes and no.
As outlined earlier, we discussed Personal Capital’s wealth management service fees by providing you the fee structure based on your net worth. Keep in mind, their service fees are equal to that of most, if not all, wealth management advisors.
In today’s technologically advanced world with our smart phones and various other mobile devices that allow us to connect to a global reach, we worry most about privacy and security; the word “hacking” becoming synonymous with our everyday lives.
Personal Capital’s mobile app, specifically its security department, has received nothing but positive rankings – allowing you to rest easy knowing your information is safe. Personal Capital requires the account holder to register each Personal Computer you use for your wealth management. The wealth management company allows you two options to verify and register each device – either via email or by phone. Personal Capital’s website and mobile app both uses an encryption synonymous with highly reputable sites while also requiring an account image and password both to register your device as well as log-in.
Interesting fact: Another wealth management company review site gave Personal Capital a solid five star rating.
- It is easy to use with their seamless integrative technology spanning across the personal computer, tablet and smart phone
- Easy to manage accounts with their intuitive interface
- They provide graphs and charts alike that are user-friendly and easy to understand
- Gives you the ability to manage how much I am spending in your investments and to see how much you are saving
- The Universal Checkbook feature reacts like PayPal, allowing you to transfer funds to where needed and it is free of charge
- Has an automated weekly email feature indicating changes in your net worth. You can also choose to have bill alert reminders as well
- Personal Capital assists you in exactly your investments fit into the asset allocation your have chosen
- Their mobile app is available on various platforms (such as personal computer, smart phone, and tablet)
- Their wealth management fee structure is equivalent to that of most, if not all, other wealth management advisors so it comes down as (to each their own)
- The budgeting function of the app has many limitations and is not as good as say Mint.com
As the world today relies more and more on online services for every aspect of their lives, and as more and more financial firms work to service those online financial needs, clients are demanding high-quality, transparent, objective services from financial companies. These truths are at the core of the Personal Capital mission. The 700,000-plus clients they service and their growing 1 billion-plus managed assets prove that Personal Capital lives up to its promises. I think what I like best about Personal Capital is that it doesn’t limit its services to only wealthy clients. Personal Capital has something for everyone, from the young-and-just-starting-out adult, eager to learn how to manage their finances properly, to the independently wealthy avid investor, and everyone in between. Regardless of your income, debt load, net worth or current financial situation, Personal Capital can help you get your personal finances on more solid ground, whether that’s through helping you track expenses and budget, or whether that’s to grow your plush nest egg to an even bigger number.
If you’re searching for a one-stop shop that allows you to view, manage and assess every aspect of your financial portfolio, consider educating yourself on the benefits available from Personal Capital. You may just find what you’re looking for.