Personal Capital is a wealth management company that offers a powerful suite of financial tools you can use to track your money. Thankfully, these tools aren’t just for clients; Personal Capital’s financial tools are available for anybody to use, allowing you to see a complete picture of your financial situation all in one place.
Here’s the best part: They are completely free!
Pretty cool, right?
We’ve been using these tools for years and wanted to share our experience with you in this Personal Capital review.
Over the last several years, we’ve tried several different wealth management and financial tracking tools. In our opinion, Personal Capital provides the best free money tools you’ll find.
There are no gimmicks or fine print to worry about. Signing up for an account is easy, and you are under no obligation to purchase anything from the company. Use of the tools is always free, making them our favorite alternative to Quicken and other “pay to play” tools.
Want to know how Personal Capital can help you? You’re in the right place.
The following Personal Capital review provides a detailed explanation of each tool, describes how we use them, and offers tips for how you can make the most of the free tools that are available. We’ve even updated the review for 2019, so you have the most current information on Personal Capital available.
Let’s get started, shall we?!?
Personal Capital at a Glance
- Founded in 2009
- Over 1.9 million registered users
- 18,000 investment clients
- $8 billion in assets under management
Personal Capital Top Features
- Net Worth Tracker
- Cash Flow Tool
- Investment Checkup Tool
- Retirement Planner
- 401(k) Fee Analyzer
- AES-256 Bank Level Encryption
What Is Personal Capital?
If you’re new to Personal Capital, it helps to think of the company as two separate units – free financial tools on one side and wealth management services on the other. This Personal Capital review focuses mainly on their financial tools, however, we’ll also provide a quick summary of their wealth management services.
As we’ve mentioned, Personal Capital offers a robust suite of free financial tools to anybody who registers with a free account. The tools provide various insights into your investments and overall financial standing. We’ll cover each of these tools in more depth below.
Additionally, the company offers fee-based wealth management services to investors. You are under no obligation to sign up for these services, even if you use their free tools.
The company was founded in 2009 and now claims $6.5 billion in assets under management. More than 1.6 million users have registered with Personal Capital, tracking over $500 billion across those accounts. They also use AES-256 encryption and require you to register each device you plan to use with your account.
Personal Capital’s Free Financial Tools
If you haven’t started using Personal Capital’s free money tools, I think you’re missing out. This free financial software helps you track your spending, analyze your retirement portfolio, track your net worth, and more.
Frankly, we think they are the best free financial tools around. Best of all, there’s no obligation for you to buy anything. Simply link your information and track all your accounts in one place.
We have used Personal Capital for years. We love it and we think you will too. Before we explain each of the tools in-depth, take a minute to check out the informational video below.
The Personal Capital dashboard provides a snapshot all of your financial accounts in one place, making it one of the most powerful features these tools offer. Better yet, you see it immediately upon logging in.
On the Personal Capital dashboard, you’ll find balances for all of your linked bank accounts, a list of your current investments and their balances, as well as a snapshot of your monthly cash flow. You can also check out your current net worth on an easy to read graph.
Here’s a quick peek at what you’ll see:
How We Use It: Of course, the dashboard is the first thing we see each time we log into our account. It allows us to quickly see if there’s been any major changes to our financial standing. We simply check out what’s been happening on the dashboard, then move on to the other tools for more in-depth info.
Net Worth Tracker
In our opinion, your “net worth” is the most important financial number you can track. In fact, it’s the best metric for measuring whether you’re winning with money, and it’s a number that everybody who is serious about their finances should know.
In a nutshell, net worth measures the worth of your assets versus the amount of debt you owe at any given time. So, tracking and comparing your net worth over time provides a ton of insight into whether you’re financial situation is moving in the right direction.
The free financial tools at Personal Capital makes tracking your net worth a breeze. Just link all of your asset accounts (banks, investments, etc.) with your liabilities (mortgage, student loans, car loans, credit card debt, etc.) and – voila! – Personal Capital does the math for you. You can even see your number directly from the dashboard.
By using the software, you can easily track your financial progress from month to month. Once you link your accounts, transactions are recorded on your Personal Capital account almost instantaneously. So, you can even track your numbers daily, if you’d like.
Here’s a screenshot of what this looks like:
How We Use It: Personally, we’d drive ourselves crazy if we checked our net worth every day. Do to swings in the stock market, net worth can vary greatly from day to day. Instead of riding the emotional highs and lows of the market, we look at our net worth about once a month or so, just to make sure we are staying on track. For us, building wealth is a marathon, not a sprint.
Investment Checkup Tool
The Investment Checkup Tool is another powerful addition to the Personal Capital lineup. After linking your accounts, this tool performs an analysis on the success of your investments. Then, it generates ideas for how they could do even better. You’ll even get a customized investment plan based on your current portfolio holdings and stated goals.
Specifically, the tool creates a target portfolio allocation that’s ideal for your financial situation. It then compares that target allocation to your current portfolio and makes general suggestions regarding your level of risk and potential for returns.
Now, if you’re a beginner or have recently learned how to start investing on your own, this isn’t as overwhelming as it might sound. Essentially, the Investment Checkup Tool helps ensure that you have the proper amount of exposure and diversification in your investments. Here’s a quick look at what you might see:
How We Use It: This is another valuable tool that we use on a semi-regular basis. As DIY investors, the suggestions offered about our ideal asset allocation mix are extremely helpful. Before making any changes, we always compare Personal Capital’s suggestions with those provided by our brokerage account. When they are both telling us to rebalance our holdings in a certain manner (which is almost always the case), we go ahead and make the change.
401(k) Fee Analyzer
While you’re going to incur costs with any investment, one of the keys to long-term growth is keeping those costs down. If you want to learn if you’re making any mistakes with your 401(k) or how much your current retirement accounts are costing you, this is the tool for you.
Personal Capital’s Fee Analyzer searches for hidden fees and shows you how much they’re costing you over time. It clearly exposes how much each investment is costing you and explains how those fees affect your retirement savings.
Here’s what the Fee Analyzer looks like:
How We Use It: This tool is super valuable if you have a work-sponsored retirement account or you use a financial advisor. Rather than blindly shoving money into your retirement accounts, the tool plainly lays out what those investments are costing you. You can use that information to adjust your retirement savings strategy as needed.
Personal Capital also offers a fantastic retirement planning calculator. With this tool, you simply set your retirement goals and measure whether your financial plan is on track to meet them. It’s a pretty cool feature, and – again – it is completely free!
The Retirement Planner isn’t just a simple calculator, though. It also helps you plan for big expenses (like college, weddings, etc.), income events (like raises and social security payments), and it helps analyze your spending and savings habits. So yeah, it’s pretty powerful.
Here’s a sneak peek at how it looks:
How We Use It: The Retirement Planner is another tool we use on a regular basis. It’s a great “big picture” tool that is perfect for comparing your current level of savings with your stated goals. As I mentioned, you can also use this to ensure your savings is on track for other big expenses, as well.
Cash Flow Tool
Last, but not least, is Personal Capital’s Cash Flow Tool.
To get ahead (and stay ahead) with money, it’s important to know how much you have coming and going. Unfortunately, tracking this stuff can be a total PIA, especially if you’re doing it manually. That’s where Personal Capital can give you an advantage.
The Cash Flow Tool makes it easy to see where you stand by automatically tracking your deposits and spending. Once you link all your accounts, every transaction is recorded in real time. Personal Capital even tracks and categorizes each transaction for you. You can view each transaction by category, merchant, or date, making it super simple to see exactly where your money is going.
Frankly, the Cash Flow Tool is a huge time saver. Keep in mind, though, that the tool has limitations and shouldn’t be used as your sole budgeting or expense tracking tool. Instead, it’s best to use Personal Capital with another budget specific program. Or, you can learn how to create a budget here.
Anyway, here’s an idea of what the Cash Flow overview looks like:
How We Use It: Although we wouldn’t necessarily using this tool as your only expense tracking tool, it does provide some good information. Since we typically pay for everything using credit cards or online bill pay, the cash flow tool provides a fairly accurate double-check on how much we’re spending.
Personal Capital Wealth Management
With all of these great free tools, how does Personal Capital actually make money?
Simple. They provide wealth management services.
In addition to their free tools, Personal Capital offers 3 different levels of investment services based on the amount of money you have to invest. You must link at least $25,000 in portable assets to be eligible for these services.
Investors with $200,000 to $1 million in investable assets qualify to have two dedicated financial advisors working on their account. Those with more than $1 million in investable assets are eligible for Personal Capital’s “Private Client” program. At each level, fees are based on a percentage of the total amount of money you have managed.
Again, it’s completely your choice whether you join Personal Capital’s wealth management program. You make the call. Even if you don’t join, you can still use the tools for free, no questions asked.
Personal Capital Wealth Management Fees
If you participate in the Personal Capital wealth management program, you’ll be charged a fee based on a percentage of the total balance you have invested through them. As of September 2018, the fees are as follows:
- Up to $1 Million Invested: 0.89% annually
- $1M to $3M Invested: 0.79% annually
- $3M to $5M Invested: 0.69% annually
- $5M to $10M Invested: 0.59% annually
- Over $10M Invested: 0.49% annually
Once again, this is an optional service. Using their financial tools is completely free, regardless of whether you choose to invest with them.
Benefits of Using Personal Capital
- Free Financial Software – As we’ve outlined above, the financial tools at Personal Capital are as powerful as any tools you’ll find. Best of all, they are completely free.
- Complete Financial Picture – With the Personal Capital dashboard, you can see all of your most important financial information in one place – which is great for tracking your overall financial health. For a more detailed analysis, simply click on the individual tools.
- Automatic Tracking – By linking your accounts, Personal Capital automatically tracks the most important aspects of your financial life. In addition to being convenient and saving you time, it also improves the accuracy of your tracking.
- Simple to Use – Linking your accounts couldn’t be easier, and you can get started in minutes. Additionally, the graphs and charts within each tool are exceptionally easy to read and understand, even for novice investors.
- Variety of Apps Available – In addition to its desktop programs, Personal Capital is also available on a variety apps which can be found for iPhones, iPads, Androids, and Apple Watches.
- Socially Responsible Investing – For those utilizing Personal Capital’s investment services, the company recently released their new “Socially Responsible Personal Strategy.” This service is designed to help those clients who want to invest in companies that are deemed to be “socially responsible.”
Disadvantages of Personal Capital
To be perfectly honest, there isn’t a lot about Personal Capital that I dislike. When it comes to the free tools, I’ve really got no complaints. The tools really are free, and you’re under no obligation to purchase anything.
With that said, you may be contacted about investing your money through the company. I’ve never found the calls to be overbearing, and a simple “no” is all it takes if you’re not interested.
When it comes to the investment services side of the equation, Personal Capital’s fees are higher than you’ll find with a true robo-advisor but on par with other fee-based advisors. They are also all-inclusive, so you don’t have to worry about any hidden fees.
In our opinion, those with less than $200,000 in investments may be better off with a robo-advisor like Betterment. However, if you have more than $200K in investments and want more personal interaction, getting 2 dedicated financial advisors for a relatively low fee is pretty darn good.
Personal Capital Review: The Verdict
Here’s a shocker: We absolutely love Personal Capital’s free financial software.
I’m not kidding when I say that Personal Capital has the best free money tools around. They do. The tools are simple to use, easy to understand, and they are completely free! While I wouldn’t use them as my sole budgeting system, they work extremely well in conjunction with other budgeting programs or a personal budget you’ve created on Excel.
Since you’re under no obligation to use their wealth management services, I don’t see any reason why you shouldn’t open a free account right away.
We use them. We love them. We think you will too.