Personal Capital is an online financial advisor and investment platform that combines the best aspects of roboadvising and traditional financial advisory. The platform is geared towards higher-end investors, but it boasts some of the most powerful features you can find. Our Personal Capital review will analyze this service piece by piece and tell you if it’s the real deal.
Personal Capital Review: Background
Personal Capital is based in Redwood Shores, CA, and it’s been around since 2009. By 2015, the company had amassed thousands of clients and over $150 billion in assets under management.
The company made a name for itself by integrating automated tools into traditional financial management services. Personal Capital isn’t a roboadvisor firm, per se, but they have some of the best automation tools available.
Personal Capital Review: The Basics
The Personal Capital app suite offers tons of proprietary tools for managing investment portfolios. The tolls give clients the resources they need to invest successfully, but Personal Capital users can also access top-tier financial advisors for when they need an extra hand.
The platform offers two tiers of services. The basic package allows users to use PC’s planning tools to manage their investments. PC also provides brokerage accounts, but the minimum opening deposit is $100,000 to start. If you invest $200,000 or more, you can access two full-scale financial advisors.
Personal Capital Review: Features
Personal Capital features a wide variety of wealth and portfolio management tools, including:
- Net Worth Calculator
- Budget Applications
- Cash Flow Reports
- Retirement Planning
- Fee Chart
- Educational Planner
- And Much More
All and all, this arsenal of tools has something for everyone. Most of the tools link to your financial accounts, so they automatically integrate with your other investment applications. The PC suite of applications is especially useful for younger investors because they’re so easy to use. They can also help investors organize and diversify their portfolios to avoid concentrated risk.
PC’s retirement planning tools are also very flexible. Users can easily adjust the settings to reflect their goals and target dates. Plus, the fee analyzer shows you how to invest as efficiently as possible. Users can also use the education planner is to plan for educational savings.
Let’s take a deeper dive into these features.
PC’s Net Worth tool measures the total value of your assets and liabilities, then tells you your overall net worth. The calculation includes both debts and investments so you can get an accurate picture. The Net Worth tool easily links with your other accounts, so you don’t have to manually fill in the information.
The budgeting tool tracks your spending and tells you where you stand concerning your budget. It automatically sets users’ budgets based on a 50-30-20 allocation strategy. Ideally, you want to spend 50% of your income on your needs, while 30% goes towards discretionary spending. Finally, the remaining 20% goes into savings.
Users can also categorize their purchases so they can quickly identify where they’re overspending. It also tracks total monthly cash flow and much more.
The Cash Flow tool tells you how much money is coming in and out of your account every month. Like the other PC apps, you can easily link it with your other financial holdings, so the entire process is streamlined and convenient.
Retirement planning is one of the most critical elements of financial planning. Personal Capital retirement tools track your retirement holdings in a centralized place, so you can analyze their performance and manage them from a centralized location. The app also allows you to set target dates and goals, so it’s easy to see whether you’re on track.
The fee analyzer tool provides step-by-step instructions to help you minimize fees. It also includes adjustable parameters so you can get the most realistic model and plan.
This specialized tool allows users to set savings goals specifically related to education. The calculator also incorporates adjustable settings for rooms, board, and food. Once you input the proper parameters, the app tells you exactly how much you should save every month to meet your savings goal.
Personal Capital Review: Financial Management Services
If you’re interested in PC’s wealth management services, you need to have a nice amount of coin stashed away. There’s a minimum opening investment requirement of $100,000, so it’s not a suitable option for many younger investors. However, PC’s financial management services are backed by world-class advisory services, so you’ll get top-notch advice if you can pay the admission price.
One of the best things about Personal Capital is its transparency regarding its investment methodology. Most roboadvisors focus solely on risk and allocation, but Personal Capital also considers market conditions in their investments. As a result, Personal Capital’s data-driven approach does an excellent job of acknowledging individual investing objectives.
Personal Capital Review: Tax Optimization Plans
Personal Capital also takes extra care to minimize your tax liability. It puts your higher-yield investments into tax-advantaged accounts so you can avoid a large tax bill. PC also offers tax-loss harvesting to further offset your capital gains liability.
Personal Capital Review: Auto-Rebalancing
PC also offers automatic portfolio rebalancing. This feature is most prevalent with roboadvisor firms, but PC users can take advantage too. Auto-rebalancing will automatically redistribute your holdings to ensure they stay in line with your allocation goals and risk profile.
Personal Capital Reviewed: Cost and Value
Personal Capital’s planning tools are 100% free to download and use. There are no hidden costs either, so you’ll pay nothing to access their features. All you have to do is download the app, connect your accounts, and are you’re ready to start managing your finances.
On the other hand, there is a fee for Personal Capital wealth management services, and they charge more than most financial managers. As we mentioned before, there is a $100,000 minimum investment to start. Once you open an account, you’ll pay 0.89% of your assets under management on an annual basis. It’s slightly higher than the overall market average, but you get a lot of value for your money.
If you invest more than $200,000 in your PC account, you can access dedicated advisors and custom portfolio management services. These services are included in the 0.89% fee, so you get a lot of value for your dollar. The AUM fee goes down to 0.79% when your balance tops $1 million, and it gets even lower from there. A $10 million investment brings the total fee down to 0.49%.
$100,000 is a lot of money, and most investors don’t have much to throw around. However, everyone can benefit from PC’s useful financial planning tools, so there is something for everyone.
Is Personal Capital a Scam?
Absolutely not! Your data is 100% safe with Personal Capital. All user data is secured using standard 256-bit encryption, and PC operates under the highest data transmission standards.
If you invest, your money is safe too. Your funds are covered with extensive insurance so, you’re compensated for your losses if the company goes under. All Personal Capital Accounts also have FDIC insurance that covers account balances up to $1,250,000.
Personal Capital Reviews: Word on The Street
Personal Capital has a fantastic Trust Pilot rating with almost 600 reviews. Reviewers gave PC an average rating of 4.4 out of 5, which is an excellent score. Most reviews praise the financial planning tools for their ease of use and accessibility. One reviewer said that Personal Capital’s planning tools actually saved them about $6,000 over a year.
Personal Capital Pros
- Intuitive and Convenient Financial Management Tools.
- Free Access to Financial Planning Apps.
- Wide Variety of Useful Applications.
- Access to Financial Advisory Servies.
- Easily Integrates with Existing Accounts.
- Access to Live Advisors for Wealth Management Clients.
- Dedicated Financial Advisors for Big-Ticket Investors
Personal Capital’s financial planning tools are some of the best and most comprehensive on the market. Best of all, they’re free to download and use, so there’s really is no reason to not download and try them out. Personal Capital also has excellent wealth management services, although you’ll have to have a hefty account balance to access them. However, if you can cover the cost of admission, you can get personalized support from a team of experts for a relatively low price. All and all, this is an excellent platform that offers tons of great features for investors of all skill levels.
That’s it for our Personal Capital review. Click here to download Personal Capital’s free financial management tools and start getting the most out of your portfolio