We are huge advocates of investing for your future, and if you are serious about starting, Personal Capital is one of the best for helping you with this.
Personal Capital is an online tool that can help you get financial advice- for free! They have changed the way we do financial planning, and think they could do wonders for you, too.
So, of course, we need to do a Personal Capital Review to run through all of the features that Personal Capital offers and show you how we track our investments for free.
Personal Capital Review
Personal Capital is an online financial advisor and wealth management company that provides free tools and investment advisory services for you to get an overview of your finances.
They were founded in 2009 by Bill Harris, Rob Foregger, Louie Gasparini, and Paul Bergholm, with headquarters in California. They have $12 billion in assets under management.
Personal Capital’s best for people who need money management, but it comes down to a bit more than that.
You’ll want to use Personal Capital if you free and hands-off management, tax optimization, and real human advisors- but you also need to be an investor with a higher net worth in your portfolio to meet the account minimum.
If you’re new to investing, you may not have the minimum $100,000 in your accounts to qualify- but if you’re a beginner using Robinhood to invest in stocks and crypto, you may get there sooner than you think!
How Personal Capital Works
Personal Capital works by allowing you to link all of your financial accounts so that you can see them all in one place.
Their main focus is on investing, with various dashboards so that you can have a general overview of all of your financials.
In order to do this, you’ll need to go to the Personal Capital login and then link all of your accounts – checking accounts, retirement accounts, etc.
Personal Capital will help you to work on your financial goals each month by seeing a broad overview in one place.
There are 3 tiers to Personal Capital:
- Investment Service (Investments Managing)- this is the beginner tier to Personal Capital’s offerings where you get a portfolio geared toward your financial goals, comprised of ETFs that Personal Capital rebalances and manages for you. The accounts are covered for investors with $100,000 – $200,000.
- Wealth Management Service- this is the middle tier that invests in ETFs plus individual stocks for you. You have more advisors dedicated to your portfolio, plus they can give you advice onstock options, insurance, and more. Users in this tier have $200,000 – $1 million.
- Private Client- Personal Capital’s final tier invests in all of the above plus bonds, private equity, and more retirement options. Your account will need to total over $1 million to fall into this category, and all that money means you’ll have more advisors to support you- and help you with tax loss harvesting and tax optimization.
Pros Vs. Cons
It’s always important to look at the pros and cons of something new and weigh up whether it is worth you doing it.
Here’s what we’ve found after using Personal Capital for our financial planning and getting a feel for it:
- Free to use comprehensive investment tools
- Portfolios include tax optimization, tax loss harvesting, and automatic rebalancing
- App available to on-the-go money management
- Easy to use and visually appealing
- Investing is done with the help of a financial advisor
- Financial advisors and great customer service to support you
- Security of the site is excellent
- Fees if you want to upgrade and use their financial advisors
- Account minimum is $100,000 in your portfolio
- Management fee is 0.49% – 0.89% (depending on how much is in your Personal Capital account)
Personal Capital’s Unique Features
There are several features that Personal Capital offers. Here’s a quick list before we talk more about their most popular features:
- 401(k) Fee Analyzer
- Asset Allocation Target
- Education Planner
- Email notifications
- Exclude From Advice
- Investment Checkup
- Personal Capital Cash
- Retirement Planner
- Retirement Paycheck
- Upcoming Bills
Personal Capital Dashboard
Net Worth Tool
Looking at your net worth is a good idea to get an overall higher look at your finances, and Personal Capital has it all in one place for you.
When you do the equation to calculate your net worth, you are doing your assets – liabilities.
Your assets are everything that you own e.g. cash, investments, jewelry, etc.
Your liabilities are anything that you owe money on, such as any debts you may have – student loans, credit card balances, mortgages, etc.
With the Personal Capital app, you are able to link all of your assets and liabilities, so it will be able to populate your net worth within the dashboard.
Every time that you log in you will be able to see (hopefully!) the positive growth of your net worth.
Cash Flow Analyzer
Personal Capital will log your income and expenses and provide a data chart of your cash flow.
This is helpful because you can have an overall view of your daily spending and how it impacts your finances.
Budgeting With Personal Capital
We love the budgeting section of Personal Capital because you can divide your spending into categories, which will allocate percentages to each category.
This helps you to be able to see how much you are spending in each category and make any adjustments as needed.
You are also able to set a monthly savings target and keep track of it within this area.
Want to have a look at your portfolio? Personal Capital helps you to do just that.
This is helpful, especially when you have a diverse portfolio – it will save you from logging in to all of your different accounts.
Retirement Planning- Fee Analyzer
You pay fees on your retirement accounts, which will affect how much you can invest – and, therefore, your retirement date.
You want to retire early, but paying fees on your money may put that off too much!
Personal Capital makes retirement planning easier. In their fee analyzer, you can see how these fees impact your situation and any hidden fees in your mutual funds.
Plus, you can take that information and see what Personal Capital’s advisors recommend you do to keep more money in your pocket.
Cash Management Account
Personal Capital offers a Cash Management Account, which they call Personal Capital Cash.
As you’d expect, this is an account where you’re money comes all together after you get paid, and it’s insured by the FDIC like most major bank branches.
There is no account minimum, but your money will earn 2.02% APY, which could compete with what your current bank is offering.
The one drawback is that we haven’t seen an update on getting a debit card with the account- it’s in the works for cash management accounts but isn’t there yet.
How to Sign Up For Personal Capital
If you’ve decided that you want to now sign up with Personal Capital for all of the great benefits, then here how to do it.
All that you need to sign up is:
- Your email address
- A password
- Your phone number
Your phone number is used to verify your identity.
Once you’re all signed up, you need to connect your financial accounts. Then you can track your investments and get help with your financial planning!
Personal Capital’s Wealth Management Service
Personal Capital is free to use unless you qualify for their Wealth Management Services.
You have to pay a fee between 0.49% – 0.89% if you have more than $200,000.
It’s an advisory service with financial advisors available to help you manage your financial portfolio.
Personal Capital Fees
Personal Capital is $0 to sign up for and has many free features to use to manage your money and track your investments.
If you want to use the more advanced wealth management services that Personal Capital offers, which you can opt into if you want more help managing your investments.
The fees are as follows:
For Investment Services & Wealth Management Clients
- First $1 million – 0.89%
For Private Clients
- First $3 million – 0.79%
- Next $2 million – 0.69%
- Next $5 million – 0.59%
- Over $10 million – 0.49%
Now the fees may seem a bit high to you, but a financial advisor sometimes charges 1% of your account, so Personal Capital’s fees aren’t necessarily the highest we’ve seen.
Having a Personal Capital financial advisor costs a lot less, and you get a lot more!
Plus, you can get a team of advisors, and Personal Capital does the investing for you- taking work off your hands.
Frequent Personal Capital FAQs
Is Personal Capital safe?
This is a good question and one that you should always ask when setting up something new – especially if it is something hooked up to your bank and investments.
Nobody within the Personal Capital company will be able to access your financial information – they take that aspect very seriously.
You will need to register every computer that you use and authorize the device that you are using to access it.
A handy feature is that you aren’t actually able to do any withdrawals or transfers within Personal Capital – it is just an overview of your finances.
If you want to know more about Personal Capital security, check out their blog post explaining how they do personal security.
Is Personal Capital really free?
Yes, Personal Capital is free and is the best way we have been able to track our passive income. If you want to access additional features, that’s where you will pay for those, but there are no hidden charges.
Within the free version, you are able to get a lot of information, such as budgeting and a retirement planner which is handy to get a grip on your finances.
Where can I invest my money?
If you’re interested in the best investments, you can get robo-advisors to help you manage your money as your wealth grows.
Wealthfront auto-invests your money, rebalances your investments, and so much more, so if you want to set it and forget it while still making more and saving more, then check it out!
However, if you want a financial advisor to support your account, Wealthfront may not be the option for you. They have great customer service to find things out, but there aren’t any finanical advisors to discuss investments with you.
If you’re interested in all that hands-off investing plus more account options (like retirement!) and some lower account minimums, you should check out Betterment.
Read more about this Robo-advisor in our Betterment Review.
The fact that Personal Capital is free and you get access to so much information makes it a no-brainer for us.
We are of the opinion that you should try out a bunch of different things and find out which works best for you.
If you aren’t sure which one to pick when looking at Mint vs Personal Capital, we recommend checking out our article which compares the two.