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The money app you need to manage your money – a Personal Capital review
I sipped my morning brew of Costco coffee one morning when a friend told me I was paying an almost criminal amount in investing fees through my advisor.
“Criminal?” I questioned with a surprised gaze. “Yes, criminal.” Without spitting out my coffee, I realized I needed to listen.
Sadly, 40% of investors don’t know how much investment firms charge to manage their money. Not knowing this information can cost you hundreds of thousands over your investing lifetime.
If you can create a simple retirement plan without the heavy fees some companies charge, you can become six figures richer as Bogle and Collins argue in their respective finance books.
How do you go about managing your investing without paying high fees?
To answer your question, I wrote a Personal Capital review today to help you learn more about your money without the stress.
While sharing some of the pros and cons of the Personal Capital app, all opinions are my own.
Heads up: This post may contain affiliate links. Check out my disclosures for more info.
What is Personal Capital?
Personal Capital is a financial management app for anyone interested in managing their money better. It works by aggregating all of your financial accounts into one convenient location.
At any moment, the app will tell you what your net worth is, how your specific investments are doing, and post the estimated market values of real estate you may own.
The best part? It’s 100% free to sign up with Personal Capital.
How to add your accounts
Personal Capital makes it very easy to upload your accounts into their system.
Once you sign up, click “Link Another Account” on the left hand side to add your accounts into the system.
Personal Capital has thousands of banks linked within their system making it easy to see your accounts in one location.
The system will take you through adding your assets and liabilities. Once added, it will automatically update your accounts whenever you check the website or app.
This process of adding the majority of my accounts took less than 5 minutes.
What are the pros?
1. FREE personalized analysis of your financial situation.
While many money management apps exist on the market, few, if any, provide the free quality investing information that Personal Capital does.
When you add your accounts, it will tell you if you have:
- a balanced portfolio
- too much uninvested cash
- accounts that charge high fees
- a strategy that could achieve your retirement goals
- a portfolio that tracks what the S&P 500 is doing
- good cash flow in your checking accounts
- and more
When I signed up with Personal Capital, it confirmed what my friend said.
I was paying too much in investing fees as is common with beginner investors who don’t know how to invest.
Getting out of high fee, low value investments can save your family hundreds of thousands over your lifetime.
2. The app notices changing market trends.
As the markets change, Personal Capital will notice if you are invested too heavily in one section of the market.
Keeping a balanced portfolio can help you maximize your results when certain sections of our market does well while limit the under performers.
In the U.S. market, its common for some areas to skyrocket while others lose. Instead of predicting who the winners and losers will be – leave that to Warren Buffet – Personal Capital can help you keep a balanced portfolio.
You don’t have to invest with them either to get this advice. They want to help you learn more about investing.
I like that their focus isn’t on selling you product right away compared to money apps chock full of ads everywhere you look.
That’s one of the main reasons Personal Capital is different. The company wants to build a relationship with you.
In doing so, Personal Capital adds the one piece of wealth building that’s missing from your tool kit – no bull investing advice.
2. Easy to read charts.
Personal Capital builds beautiful and modern graphs showing how you’re building wealth over time.
This means you don’t have to spend hours analyzing your accounts, forgetting your passwords, and getting frustrated during the process.
It’s all available on the app.
Similar to Mint, Personal Capital will analyze where your cash is going and compare it to your yearly spending throughout the year.
This can be helpful in recognizing your personal spending habits and help you determine what, if any, changes you want to make.
I like that Personal Capital doesn’t charge to download my transactions like I would have to pay if I used another app. It’s 100% free.
The other awesome graph is the Net Worth graph.
This one really shows your financial progress over time.
Whenever you think about reaching financial independence, you can always look back and see how far you’ve come in the journey.
3. Personal Capital can analyze your 401(K) options.
One of my favorite aspects of Personal Capital is its free analysis of your employer’s 401(K) options.
It’s too easy to put investing off while paying off debt. Not having a basic knowledge of your 401(K) options while paying off debt can have some huge long-term costs.
When I changed employers, the new company held our investments in a holding account until I made my investment decisions. Personal Capital assisted in showing me which funds were high-fee and which offered the best value.
Had I ignored my investments and not downloaded Personal Capital, we could have missed the incredible growth potential of those hard-earned dollars.
Having some guidance in picking more affordable options within my company’s plan was an amazing value.
Now, I can keep my debt payoff going, without fear that my investments aren’t working hard for me, too.
This has freed up so much time in my life to focus on mothering my daughter and doing fun things instead of watching beta scores.
Why is Personal Capital free?
Personal Capital thinks long-term like a good investor should. By providing you an ad-free quality website and app, it hopes to build trust with you.
When you look for an investment advisor in the future, Personal Capital hopes to earn your business then.
That’s their end-game. And, they do so without the obnoxious ads trying to sell you products you don’t need.
Is Personal Capital secure?
I believe it is.
With living in a digital world, there will always be some risks with sharing financial information no matter what app you install.
Personal Capital takes financial account security very seriously and ensures that it’s current with all of the best security practices.
It’s in Personal Capital’s best interest to keep its 1.6+ million user accounts safe.
As a long-term Personal Capital investor, I’ve not had any issues with account security whatsoever.
What are the cons?
1. Adding some bank accounts can take longer than 5 minutes.
Depending on who you bank and invest with, setting up some accounts in Personal Capital may take longer than five minutes.
I was unable to add one bank myself but called the Personal Capital customer support Help Desk. The polite rep helped me get my account added within 48 hours.
While security clearances can be annoying, it’s important that personal information remains safe.
2. It doesn’t offer budget planning.
Personal Capital does not offer a budget planner, meaning you cannot use the app to set a budget. The app puts more focus on your overall financial picture than budgeting specifically.
Since I’m an Excel girl, I don’t mind this limitation, but some might.
There are a few other budgeting apps that do this if that’s what you want.
I think signing up with Personal Capital is a must do for anyone wanting to reach big financial goals.
While there’s plenty of great investment companies on the market, in my opinion, it’s easy for the industry to capitalize on the complexity of investing.
This can create an opportunity that isn’t always investor-focused as mentioned in my post on the best financial independence and early retirement books.
I believe that Personal Capital recognizes some of those challenges the industry faces and has developed an app that is investor focused.
The app is for the everyday investor who wants to know more about their investments and financial outlook.
It’s one of those tools in your financial independence toolkit that is based on EMPOWERING you with knowledge to invest wisely and affordably.
If this review encourages you to signup with Personal Capital, consider using my affiliate link below.
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Please share with me in the comments if you have any questions about Personal Capital.