Personal Capital Review

Personal Capital is an online financial advisor and wealth management company. It’s also great for managing all of your finances.

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What’s Personal Capital?

Personal Capital is an online asset management company that also offers financial advisors and wealth management.

It was founded in 2009 and has grown to more than 17 billion dollars of assets under management. It has more than 2.8 million users and over 26,000 investment clients.

The robust tools, experienced financial advisors, focus on technology and innovation make Personal Capital an excellent platform to utilize.

Get started with Personal Capital.

Features and benefits

There are many reasons Personal Capital has grown to millions of users and billions of dollars of assets under management. It has a great platform, top-notch advisors, and excellent tools.

Investment services, wealth management, and private client

If you want access to advisors, you’ll need a minimum balance of $100,000. The following are the different tiers:

• Investment services. Get unlimited financial and retirement planning guidance from the advisory team. This tier is for people with $100,000 to $200,000 of investment assets.
• Wealth management. Get two dedicated financial advisors, specialists in real estate, stock options, and tax optimization. This tier is designed for people with $200,000 to $1,000,000 of investment assets.
• Private client. If you have more than 1 million dollars of investment assets and want one-on-one comprehensive financial planning, this is the tier for you. You’ll also get access to private equity investment options.

Instead of a one-size-fits-all portfolio, Personal Capital takes a personalized approach, which helps you reach your financial goals.

The portfolios are built by using their Smart Weighting method, which is all about diversification and balance. Instead of tracking an index, such as the S&P 500, it invests in many different sectors.

Your portfolio is built with factors that are unique to you. They’ll change the allocation of your assets as your financial situation changes. Your advisor will also review your portfolio every day for rebalancing opportunities and tax optimization.

Another investment option is the Socially Responsible Personal Strategy, which allows you to invest in and support companies that align with your values and beliefs.

If you choose Socially Responsible Investing, you’ll have U.S. and foreign equities. It screens the companies based on environmental, social, and governance factors.

Cash management

Personal Capital Cash is an account that gives you the ability to earn a higher interest rate than a traditional checking or savings account.

It’s FDIC-insured, which means you’re protected up to $250,000 per account owner per program bank.

Since Personal Capital isn’t a bank, the account is opened at UMB Bank. From there, your funds are placed in accounts at different participating program banks, and they’re also the ones that’ll be paying your interest rates.

Currently, the APY is 0.05% and 0.10% for paying clients of Personal Capital. There’s no minimum balance requirement, monthly or annual fees.

You can deposit and withdraw from the account via online or wire transfers. The wire transfer limit is $1 million and is available between 9 AM and 2:30 PM PT Monday through Friday. Call 833-569-6730 to submit a wire transfer.

While ACH and wire transfers are the only ways to access your account, Personal Capital is working on debit cards and bill payment options for the future.

Financial Tools

You don’t have to be a paying client to take advantage of the great tools that Personal Capital offers. Even a free user can benefit greatly from it.

The following are the free tools that you can utilize:

• Net worth. Track your net worth to make better decisions about managing your money.
• Savings planner. Compare how much you’re saving with how much you should be saving.
• Budgeting. Set budgets, organize your finances, and achieve your financial goals.
• Cash flow. See what has come in and gone out in the past 30 days.
• Retirement planner. Figure out if you’re on track to retire by your target date and calculate your projected monthly income.
• Education planner. Plan and estimate how much you need to save to cover education costs in the future.
• Investment check-up. See how your investments are performing and what you can do to meet your investment goals.
• Fee analyzer. Find out if you’re losing money through hidden fees in your mutual fund, investing, and retirement accounts.

The free and robust tools give you a holistic view of your finances. You can set budgets, savings plans and analyze your investments.

If you’re a client, you’ll have access to other tools, as well. The following are the financial tools exclusively for clients:

• Financial roadmap. Create a customized pathway with your most important financial goals, and stay on track to reach them.
• Personal strategy. Build a personalized and diversified portfolio to reach your financial goals.
• Smart withdrawal. Learn how to withdraw funds from your retirement while staying on budget, minimizing taxes, and optimizing your portfolio.
• Employer plan analysis. See how your employer-sponsored plan is performing, and decide whether or not you should choose a different fund.

Cost, commissions, and fees

Most of the financial tools and resources are free on the platform. If you’d like to have access to an advisor for personalized guidance, there’s a fee.

The fee structure is straightforward, and there aren’t any hidden fees or trade commissions.

For investment services and wealth management clients, the annual management fee for the first $1 million is 0.89%.

Private clients have lower management fees, and they’re as follows:

• First $3M: 0.79%
• Next $2M: 0.69%
• Next $5M: 0.59%
• Over $10M: 0.49%

The fees are a percentage of your account balance. It covers administrative, marketing, and other operating costs.

Compared to traditional financial advisors, Personal Capital costs less. However, it’s expensive when you compare it to a robo advisor.

Customer service

There isn’t a generic customer service phone number that you can call. However, you can find many answers on their Frequently Asked Questions page or support portal.

If you’d like to ask them questions before establishing an account with their advisory services, you can call 855-855-8005.

If you’re already a client, all of the support happens through your advisor. Since your advisor will have access to your dashboard, you can get everything taken care of virtually.

There are also branches in Redwood City, San Francisco, Denver, Dallas, and Atlanta.

Although the customer support options may seem limited, the platform is straightforward and offers an excellent user experience.

Resources

Another great aspect of Personal Capital is the focus on education. It provides many resources and articles to help you increase your knowledge.

You can learn about investing, markets, retirement, college, taxes, insurance, and stay up to date with the latest news in finance.

Read Personal Capital’s articles.

Security

Security is one of Personal Capital’s highest priorities. You can trust that your information is safe because they use multiple layers of security.

The website is rated A by Qualys SSL Labs, which is a better rating than many banks and brokerages. It also uses 256-bit AES encryption to keep your data safe.

Their commitment to security and protecting client information is one of the best features.

Conclusion

Whether you’re using the free financial tools or want to have access to a financial advisor, Personal Capital is an excellent platform. It offers a great user experience, fewer fees when compared to traditional advisors, knowledgeable and experienced advisors.

More resources:

• What’s an exchange-traded fund (ETF)?
• How much should I contribute to my 401(k)?
• What are the different types of IRAs?

Featured image courtesy of Personal Capital.