Personal Capital Budgeting and Investment Analysis Review

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Managing your finances can be a complicated process, especially if you don’t have an effective tool to help. Fortunately, there are companies like Personal Capital that provide comprehensive financial management services. 

Personal Capital offers two separate services. The free financial tools allow you to track and manage your money in one place and for investors, Personal Capital comes with tracking and monitoring tools, investment advice, and access to a team of financial advisors. Customers have access to both types of service.

Before you join Personal Capital, read on to find out how the app works, the tools and services offered, and the answers to some important and frequently asked questions.

What Is Personal Capital and How Does It Work?

Personal Capital is an online financial advisor that provides personalized financial recommendations along with wealth and cash management tools. From your account dashboard, you can view an in-depth overview of your money where you can track the ins and outs of your budget, investments, cash flow, and net worth in one location.

$0 Price Advisory services have separate fees
Available on iOS, Android, PC
DollarSprout Rating

Personal Capital is an investment advisory firm. This means Personal Capital employs financial advisors to help their clients with their investment choices. In order to work with them as an advisory client, you have to invest a minimum of $100,000 with them. However, even if you don’t have $100,000, Personal Capital offers free tracking software. Connect all of your accounts to their free platform, and you can see your net worth, track your spending, and more. You’ll get emails telling you how your portfolio is doing.

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Pros

  • Free to use
  • No account fees
  • Customizable portfolio mix
  • Supports 401(k)s, IRAs, 529 plans, and trusts
  • Automatic rebalancing
  • Tax-loss harvesting
  • Access to certified financial planners
  • Personal Capital budgeting and cash flow tools
  • Investment simulators and calculators

Cons

  • High management fees for paid services
  • Large account minimum for Wealth Management
  • Limited budgeting capabilities
  • May experience solicitations

Personal Capital’s money tools for budgeting and net worth planning include monthly summaries and the ability to set financial goals. It uses charts and reports rather than numbers or spreadsheets to show exactly how your finances are shaping up, making it easier to read and understand. Most banks, credit cards, and investment accounts can import without any trouble, although some users do report problems linking with lesser-known banks.

Personal Capital also provides high-level investment and tax optimization strategies to maximize your money. You can reach financial advisors by phone, email, live chat, or web conference 24/7. If you have a significant amount of money to invest, this might be a good choice for you, but it does come with account management fees so keep that in mind when making the decision to invest with Personal Capital.

Is Personal Capital Safe?

You can also trust that your information is secure with Personal Capital, which uses military-grade AES-256 encryption with multi-layer key management. Additionally, a two-factor authentication setup is an option, and iOS devices can utilize fingerprint scanning.

Personal Capital has a 4.7 of 5-star rating in the Apple store and a 4.4 of 5-star rating with Trustpilot. Many users report liking the ability to track all of their accounts in one place, helping them organize their finances and see their true net worth. Common complaints typically focus on app uses including glitches, bugs, and connectivity issues as well as poor customer service.

Getting Started 

Creating an account is free using the Personal Capital app or website. First, you’ll answer a series of easy-to-answer questions, like your preferred retirement age and how much money you already have in your investment accounts. This information will help you evaluate and personalize your savings and retirement goals.

Syncing to your bank account is the next step. If you connect your accounts, Personal Capital will import your financial data. Your transactions for the last 30 days appear on the financial dashboard, which the software analyzes to offer suggestions. Implementing this personalized advice can move you closer to your money milestones.

Although it’s free to join Personal Capital, and many of its features are free to non-account holders, you will need a $100,000 minimum investment in order to access dedicated personal financial advisors. Investors with less than that have a team of advisors to help them. This means that even if you have fewer dollars to invest, you can still access their network of professionals to help you make the best choices for your finances. 

Make sure to take these figures into consideration when deciding whether or not to open a Personal Capital account.

Related: Personal Capital vs. Mint: Which Personal Finance App is Right for You?

Types of Services Offered

One of the best features of Personal Capital is that it provides support for every step of your financial journey. If you’re struggling to make a budget, it can show you how to start one. If you’re an experienced investor with a high net worth, you’ll find plenty of helpful tools to grow your portfolio.

Financial tools

Personal Capital Financial Tools Screenshot

The basic level of service, these are available to all Personal Capital users; you don’t have to use their financial advisor service to access these tools:

  • Budgeting
  • Cash flow
  • Retirement planners
  • Educational planner 
  • Fee analyzer
  • Savings planner
  • Net worth analyzer

Wealth management clients have access to an additional set of tools to help them with their personalized investment strategy and other financial planning. 

You can access all of these financial tools from your account dashboard, giving you a holistic picture of your finances to make informed decisions about where you can improve and where you’re doing well. However, users report that Personal Capital’s strengths aren’t in the budgeting tools. If you’re looking for a good budgeting app, consider using Mint, Tiller, or You Need a Budget (YNAB) instead.

Wealth management

Personal Capital Wealth Management Screenshot

Regardless of how much you have in your investment account, all wealth management clients receive Personal Capital’s Personal Strategy for investing, which is how they help you create an investment strategy tailored to your goals. The Personal Strategy includes Smart Weighting (Personal Capital’s strategy for investing in all sectors, rather than just one), monitoring and maintenance, and dynamic portfolio allocation. 

Wealth management clients also receive an initial phone call with a Personal Capital advisor who helps determine how to build a more tax-proficient portfolio as well as provide retirement planning and other financial management advice.

Personal Capital offers three wealth management tiers: Investment Services, Wealth Management, and Private Client.

  • Investment Services. This is the basic level of advisory services. It’s designed for advisory clients who have $100k to $200k in investment assets. You have access to digital tools, a professionally-managed ETF portfolio, and unlimited retirement planning and financial advice.
  • Wealth Management. Designed for clients with more than $200k in assets but under $1M, the Wealth Management tier provides all the same features as Investment Services, but also adds two dedicated financial advisors (rather than a team), a customized portfolio, and tax optimization. You’ll also receive financial decision support in areas like insurance, stock options, and compensation. 
  • Private Client. This level of service is for clients with more than $1M in investment assets. You’ll receive all the same services as the Wealth Management clients, with the addition of priority access to investment specialists, private equity and hedge fund investing, and access to private banking services. You will also have access to wealth planning services including estate, tax, and legacy. 

Related: 10 Timeless Tips to Become a Successful Investor

Personal Capital Cash

Personal Capital Cash Screenshot

Personal Capital Cash is the company’s high-interest cash management account. It offers a 0.05% APY and is not subject to the account management fees. You don’t even need to be a Personal Capital wealth management customer or private client to open this type of account, although those users are rewarded with a higher interest rate. 

You can access your money via the website or app, and as long as you link your bank account, you can withdraw or deposit money into your Personal Capital Cash account. Wire transfers are also available.

Personal Capital Cash offers up to an aggregate of $1,500,000 in FDIC insurance coverage, so your money is protected.

Related: The Best Online Savings Accounts of the Year

What Else You Need to Know About Personal Capital

In addition to helping you manage your day-to-day finances and investments, Personal Capital offers other services so you can track all your financial information in one place. However, if you want to keep an eye on your credit score, you’ll need to find another program or app; Personal Capital does not provide credit monitoring.

Investment and analysis tools

Personal Capital’s investment and analysis services, many of which are free, offer helpful insights. By creating a free account, you can use these services at no charge.

With Personal Capital budgeting, your transactions automatically import. After that, the software suggests a spending category to classify them. However, more advanced users might find the budget customization options lacking. For instance, the only way to add a transaction is by linking an account. If your local bank or credit union doesn’t work with Personal Capital, you can’t access this feature. 

If you aren’t sure whether your retirement plan is on target, the retirement planner can show you. It takes into account your investments and Social Security income to project your income needs in retirement. The complete analysis includes taxes, life expectancy, and investment return calculations. Users report that they like this feature and update it often to make sure they’re still on track. 

Financial advisors

Access to real financial advisors is an attractive option for high-net-worth shareholders with at least $100,000 in assets. They can help you with retirement planning, refinancing, taxes, and estate planning. Your team will include Certified Financial Planners™ and Chartered Financial Analysts®.

If you’re an investor with a balance of $200,000 or more, you’ll receive two dedicated financial advisors to help you with your investments and wealth management.

Phone, email, and video chat support are all included.

Related: How to Find a Financial Planner That Meets Your Needs

Fees and account minimums

Account management fees can cut into a portion of your earnings. Working with Personal Capital can save you considerably more than managing your accounts on your own with a financial advisor. According to a financial advisor fee study, the industry-standard charge is 1% of all assets under management. The same study cites some fees in the 1.50% to 2.50% range.

With Personal Capital, fees start at 0.89% and go as low as 0.49%. The full fee schedule (as of September 2020) is as follows:

Investment ValueFee Amount
Up to $1 million0.89%
$1 million to $3 million0.79%
$3 million to $5 million0.69%
$5 million to $10 million0.59%
Over $10 million0.49%

If you compare these costs to some of the other robo-advisors, you’ll see that Personal Capital tends to charge more. Having 24/7 access to financial advisors might make up for the difference in cost. However, this is only available to customers with an account minimum of $100,000. If your balance is lower, it might not be worth it. 

Like other investment apps, they don’t charge hidden fees, trailing fees, or commissions on trades.

Socially responsible investing

For those investors who prefer to pick investments that align with their personal beliefs and causes they support, Personal Capital offers socially responsible investing.

You can invest in environmental, social, or corporate governance-related issues (ESGs), and according to Personal Capital’s website, ESG “issues tend to be more profitable and produce stronger financial results. Additionally, some studies show higher-rated ESG companies could also lead to better portfolio returns over time.”

Related: How to Invest: A Beginner’s Guide to Investing in the Stock Market

Personal Capital app

Personal Capital provides excellent options to help manage your money. Its primary function is that of an account aggregator. Your transactions automatically sync from accounts you connect to the program.

Android, iOS devices, and the Apple Watch have apps available. Both the Personal Capital app and web platforms are intuitive, and navigating from your spending and budget tracker to your investment portfolio is simple. As an aggregator, it functions perfectly, giving you a bird’s-eye view of your money and follows your goals closely.

The reports on account history, performance, projections, and allocation comparison are easy to access and understand.

Entering information directly without linking an account is not possible, which could be an issue for some users. You’re also not able to pay your bills directly from the program, so you will need a different method for that. 

Related: The Best Investing Apps for Beginner Investors

Personal Capital Review Summary

For many consumers, Personal Capital‘s free tools, along with the financial and investment management services, might be enough to draw you in. Free financial tools such as the retirement analyzer, investment checkups, and spending tracker can help give you a clearer picture of your finances and help you plan for your long-term goals.

The budgeting and cash flow tools offer significant advantages as well, but if you’re looking for the best budgeting software, Personal Capital probably shouldn’t be your first choice. 

For investors with a high net worth, the complete personal financial management of assets is a significant plus. It’s comparable to robo-advisor services but can better personalize big-picture advice. Investors will find higher fees compared to other robo-advisors, but the dedicated two-person team of financial advisors for qualifying clients might be worth the added expense.

Author
Amy Beardsley

Amy is a freelance writer with bachelor degrees in business administration and legal studies. She has a passion for personal finance and is on a mission to help everyday families develop better money habits and escape the burden of debt. Her work has been featured on The Huffington Post, Money Tips, and various other personal finance publications.Amy makes her home in Michigan where she serves as a Girl Scout leader and teaches work-force development training to low-skilled workers in her community. When she’s not writing about money or perfecting her budgeting spreadsheet, Amy enjoys playing board games with her family and watching Marvel movies.

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