If you’ve been with me for a while now, you’ll know that I love investing – especially in real estate and in index funds and that I’m a super-frugal saver. You’ll also know that I hate budgets, I hate fees, and I hate wasting my time. On that note, this year I’m organizing my finances with what has become my 2021 infatuation. Hello Personal Capital.
Why the love?
It’s free, saves time, and is hella motivating! I used to do this stuff in Excel, and now I feel like a mega-shmuck. What a waste of my precious time!
So let’s go into my Personal Capital Review, what I love about it, what it offers, and what I’d avoid.
(You can also just sign up now and use my review to get started. It’s genuinely free and you have nothing to lose.)
Top 3 reasons to love Personal Capital
1. Made for busy people
Once you sign up, it automatically adds everything up for you, saving you a lot of time. All you have to do is link each of your financial accounts, including investments, checking, and savings, and presto! You’re good to go. Personal Capital syncs with numerous banks and financial corporations, so you don’t need to jump through a bunch of annoying hoops.
Let’s say you summarize everything monthly. You do it over coffee and you port all of your data to one excel sheet. I have a bunch of different accounts, so those excel sheets can get pretty messy. Plotting, error-checking, and the whole shebang can take at least 2 hours. So if you do the math, in 12 months that’s 24 hours = 1 all-nighter. I would love to get my 1 all-nighter back!
With Personal Capital, you don’t need to do that because everything’s in one place neatly plotted out for you.
2. Super-motivating charts
I’m a nerd and I love graphs. Especially when they’re showing me my money. For me, this is super motivating because I’m always reminded and encouraged to stay on track. Like any other sport in life, motivation is key to keep going and excelling. Without it, everything will feel like a chore, which sucks because motivation is actually more important than strategy.
Let’s say you have a goal to sail around the world with your family (like me!) Put this goal into Personal Capital and Blamo! It’ll automatically inform you how much you need to save each month. The data you’ll need will be summarized and you’ll know how much closer you are to your dream.
Write it on your wall with a sharpie and get motivated!
3. Tracks your money habits better than you
I’m not the type of person to mull over each transaction. I just don’t have the time. But the super-convenient dashboard in Personal Capital lets me monitor my spending patterns and even track them by categories.
I had no idea that my grocery spending went up by $200 a month over the past year! (Probably because I bring my kids and let them choose their own snacks at the store.)
Anyone who hates budgets but likes mindful spending will love this app. Who doesn’t like seeing visuals of their income streams and their payables?
Understanding Personal Capital
Personal Capital is AMAZING at automatically summarizing all your info and helping you make better decisions. If you’ve been kinda lazy about organizing your finances, this tool will make you feel giddy to both check-in and to change your money habits.
We all have our own reasons to save up. Some of them are obvious: homeownership, rainy days, college tuition, travel, stormtrooper costumes, etc. But really, the important thing is to have a goal. And having something shove the numbers in your face about how well you’re doing can help you get there. Personal Capital does that.
When you see yourself moving towards your goal, you’ll be hella more motivated! It’s like a perpetual motivation machine! Hooray!
It also aggregates all of your data into one spot. I know I have too many accounts to log into. I have a separate account for my family finances, one with a brick-and-mortar location just in case, one for my rental income, my stock investments, cards that give me points on groceries, and accounts with good ForEx.
So on occasion, I’ve dropped the ball and let a check bounce! Imagine how embarrassing it is to be a money blogger who can’t keep track of his own money! With Personal Capital I actually enjoy checking in daily.
That said, let’s talk about what Personal Capital offers and why I’m so obsessed.
Types of accounts
Free (the awesome version)
Personal Capital has a free version which is amazing! Who doesn’t like free things? The financial advising AI machine provides numerous free tools you can take advantage of to grow your finances. For example, the investment checkup tool allows you to understand the best ways to allocate assets. Cool right?
The cash flow tool is pretty neat, too, because it lets you take a step back and look at your spending. Moreover, the retirement planner helps you examine your projected returns and suggests investments to help you get all set for the kind of financial future you want. All without putting in any effort. it’s automatic!
Are there ever times you want to do something extra complicated with some annoying math? Well…this tool lets you experiment with specific figures like your social security payments, annual retirement savings, and anticipated average returns to check if some changes in your patterns should be adjusted to help you reach your targets quicker.
I love seeing how hypothetical changes could impact my future!
Paid (not worth it)
Personal Capital’s paid version, also referred to as Wealth Management, involves human financial advisors for a 0.89% flat annual fee. Boo, humans. Boo, fees! Already, I can tell you that these services aren’t designed for everyone as the minimum balances are high and the fees can be costly.
Frankly, their free program is so good that I wouldn’t jump at the chance to engage with a financial advisor who’s meant to take a cut of my money. Index investing is so awesome and easy I honestly forgot other humans even exist.
Tools that come with Personal Capital
Cash flow analysis
Once you’ve linked all of your accounts, you get an overview of the money coming in and out of your entire money bubble. This allows you to better understand and control your income streams and recurring payables.
What’s more, their dashboard shows you how much of your budget is spent on what you want and need. I know it’s not rocket science, but it might actually be even better! In a world where your funds dictate your lifestyle, knowing what goes where lets you make better decisions. That’s what makes Personal Capital awesome.
And if you like to micromanage, you can also compartmentalize your spending into groups; to make a breakdown, detailing how much of your money goes to bills, gas, groceries, essentials, and everything else every month.
Again, this is something I could do for myself, but honestly never get around to.
I live the FIRE life so I LOVE Personal Capital’s Retirement Planner feature. Studies show that over a third of employees are not confident they can have a comfortable financial retirement. It’s not because they can’t save for it. It’s because they don’t know how their lifestyle stacks up against their savings.
This is where this tool comes in handy. You can clearly see how your choices today will impact your money later. If, for instance, you’ve had to spend your savings for emergency reasons, it tells you what you need to do and adjust to stay on track.
Through the program, you can add that you want to pay for college, buy a car, invest in real estate, and a lot more. Personal Capital offers you a thorough view of how you can meet your retirement ambitions and how much you can expect to have in your bank account when you retire. Neat, right?
True story: I once had a check bounced because I knew I had enough money in the account but I forgot about the monthly fees. Stuff like that is more frustrating than going to the grocery store and forgetting the one thing you came for.
Personal Capital tracks these fees and gives you an expense ratio for each fund. This will help you figure out which funds have the most costly fees and if it’s better to just cut them out. I hate unjustified fees with a burning passion and would use a Samurai sword to slash them out of my life if I could.
Free Investment Checkup
What’s a Personal Capital review without mentioning their Investment Checkup tool? As the name implies, Investment Checkup helps you better understand your investment portfolio. Use it along with the Retirement Planner for a clear investment breakdown now as well as a realistic perspective of what’s to come.
As soon as you have more than one investment account (for example, stocks and eREITs), this tool will come in extra handy. It has an organized dashboard to quickly visualize your cash flow and net worth standing. You can analyze past cash flow performance, assess risk levels, compare investments, and do a whole lot more.
One of the things I love best about this app is it tells me how much I’m saving now, and how much more I could be saving to grow my wealth. It’s kinda like that little Office Paperclip with suggestions, except it’s actually useful.
You can enter in your specific savings goal (whether it’s an emergency fund, getting rid of debt, or a downpayment for a property) and watch yourself get closer to it.
Net Worth Calculator
Until recently, I only knew my net worth come tax time. That might make me sound lazy, (which is true) but it’s not like I had just one account telling me how much money I have. When you have rental properties, you have various expenses coming out at random times, you have late checks coming in, and you have value assessments to keep up with.
I know it’s a good problem to have but it’s still a headache. And if your investments are truly diversified, keeping track of everything is basically another job. I didn’t retire early to pore over spreadsheets from 9-5!
So I changed all that, and now I actually do have just one account to look at.
Personal Capital’s dashboard consolidates all of my earnings in one view. I always see a complete overview of my net worth and where I’m at. Most people either under- or over-estimate how much money they really have. When you see this rolled up here, you’ll probably go WHOA!
Paid wealth management and the fees
Okay, this is where this Personal Capital review takes a dark turn. Darker than that time we had a power outage and I had to eat cold burritos by candlelight. Sorry Personal Capital. I love you and all, but my disdain for fees wins here.
Personal Capital does provide paid investment management for those with at least $100,000 to invest. The robo-advisory brand claims that several do-it-yourself investors often make mistakes that cost them money in the long run.
As a remedy, Personal Capital says that turning to their advisors is a fantastic option as they’re packed with decades of combined money management experience and “possess a strong desire to drive change and improve the industry.”
Now, I don’t know about you but the “drive to change” can come from anyone, so as long as you do your research and keep your investments simple with indexes, you should be fine.
I suppose I get the allure of having things taken care of for you, I just don’t trust anyone else to make decisions with my money. Also I hate management fees, so there’s that.
What’s the catch for Personal Capital?
The main downside is that they will call you and offer you their private client package, which is really just similar services but with a human financial advisor who “acts in your best interest.”
It’s not mandatory, but I don’t like getting calls. From humans or otherwise. So that said, I wouldn’t use the up-sell. The free program is too amazing and I don’t need a financial advisor who will take an extra 0.9% of my money.
This is a pretty minor negative to me. I get so many people calling me about upgrades for my ducts, windows, and roof that this is just in the noise.
TL;DR – Personal Capital Review
To wrap up my Personal Capital Review, I love it. I feel like my financial tracking has been an aimless wander and now I’ve seen the light!
I actually do recommend that you sign up for the free account and make this the year you “tidy up” your finances.
- It offers tools for saving, budgeting, 401K, fees, investment assistance, and retirement planning through an easy-to-use dashboard.
- It helps you change your money habits through spending tracking, charts, and goals.
- It puts all your accounts in one spot, which is a major time-saver.
- The free services are basically premium, so I wouldn’t bother upgrading.
We’re all walking financial projects, and a few mistakes can cause a complete cash flow disaster. Personal Capital is perfect for constantly reminding us what’s going on with our money, what we should do to remain on track, and what pitfalls to avoid on our way to financial freedom.
Personal Capital FAQ
Is personal capital worth the fee?
No, the 0.9% cut is not worth it. The free service is AMAZING as is. Signing up on their Wealth Management paid version subjects you to human financial advisors, and while helpful, you can bet that the advice they offer is learnable on your own. Keep learning the money business yourself, and you’ll do just fine!
Is personal capital safe?
Personal capital offers AES-256 encryption with multi-layer key management where no individual at Personal Capital has access to your credentials. Large banks use AES-256 encryption so this is very safe! If anything personal capital makes you safer because it has a transactions page for all your accounts. So you can easily notice anything fishy.
Is personal capital legitimate?
It’s a real service that’s been in use since 2009. It provides several advantages and offers different perks when it comes to money management. Formerly known as SafeCorp Financial Corp, the online financial advisor has been registered with the U.S. Securities and Exchange Commission (SEC) as an investment advisor, so you know you’re safe!
How does personal Capital make money?
They make money from their paid version a.k.a their Wealth Management program. Like many online services, their fees depend on the tier you sign up for. The bigger the amount you invest, the lower they charge. They charge 0.49% for money over $10,000,000, 0.59% for $5 million, 0.79% for money between $1 – $3 million, and 0.89% up to $1,000,000.
Is personal Capital better than mint?
Yes, 100x better. Mint helps you budget, and budgeting is not as good or time efficient as being motivated. Personal capital automatically makes beautiful graphs about your retirement to motivate you. What’s more, Mint is a budgeting platform and it doesn’t really help you out with investments. People who are serious about growing their wealth will 100% stick with Personal Capital!
Which accounts can link to personal capital?
Literally any account that involves money. Your bank account details, your credit card details, your mortgages, etc. If you have several account types, choose only one category such as loans, cash, investments, or credit cards. You don’t have to keep inputting your credentials, too! You save your account details, and boom! Everything is automated from thereon! Amazing right?
Can my family/spouse use Personal Capital?
Anyone over 18 can use Personal Capital! They have individual and joint accounts, too. As a matter of fact, they offer a lot of flexibility in this area because you can have both types of accounts! If you want one joint account with your sibling, another with your spouse, and a personal one, this should be easy to navigate through their dashboard!
Is personal capital available worldwide?
Personal Capital is available only in America for now, but keep your eyes peeled if you’re not from the U.S.! They may expand really soon.