When you were growing up and counting the coins in your piggy bank, you probably never envisioned the option to track your finances all in one place in just a few minutes per day.
And while counting quarters and dollars is one thing (and finding quarters is almost impossible these days), as we age, knowing our net worth and tracking our finances becomes more essential seemingly daily.
Luckily, there is an assortment of ways to do this thanks to the internet and smart phones (Thank you Al Gore and Steve Jobs).
One app and financial platform that stands out amongst the rest is Personal Capital.
Personal Capital is an app that offers essential financial tracking on things like daily finances, loans, bank account statements, monthly bills, retirement contributions, and investments… but most importantly – Personal Capital tracks your Net Worth!
Throughout the next couple of minutes, we will go over the features that Personal Capital offers, including the app, unique tools, and even some things I’ve learned through my personal experience with the app.
Quick Review of Personal Capital
To give you a quick rundown on Personal Capital:
Personal Capital is famous among many finance professionals and financially savvy people. Personal Capital is an excellent app for beginners and seasoned investors alike. No longer do you need to use spreadsheets, write down expenses, keep receipts, or balance checkbooks after every transaction. If linked to your bank account, the app will automatically categorize each spending.
Personal Capital is an app you can download on your phone and monitor your spending and group transactions by category. No longer do you need to keep a spreadsheet on a computer or balance your checkbook since Personal Capital does all of that for you!
The app allows you to know where your money is going. It even allows you to set monthly budget goals and track your investment returns in retirement and taxable investment accounts.
Personal Capital is an investment app that links to your portfolio accounts and monitors your investment returns, such as your 401k, IRA, HSA, IPERS, SEP, and other retirement and taxable accounts.
Quick Pros & Cons of Personal Capital
Most users find these positives when using Personal Capital:
- The app is an excellent resource for staying motivated and on top of finances.
- Monitor your budget and expenses
- The ability to track monthly cash flow
- Track Assets vs. Liabilities and Networth
- Informative Information analysis of asset allocation and fund fees
- Easy to use, the app is easy to navigate
- Free to use, the app is free to download and has excellent value.
- Customer Service responsive to phone calls and emails and have quickly fixed any issues I’ve had.
Some users have described these Cons with Personal Capital:
- Linking your personal accounts to the app can take time
- Some are skeptical of linking accounts
- Accounts often need refreshing and reconnecting
- Fees for Wealth Management feature
For the Wealth Management feature that Personal Capital offers, this only applies to high net worth individuals eligible for this feature.
This could be a pro for some investors, but others may prefer traditional low-cost index funds at brokerages such as Vanguard, Fidelity, Charles Schwab, Blackrock, etc.
Full Review of Personal Capital and Features:
For a full review, let's first look at who Personal Capital is ideal for!
Who is Personal Capital For?
People on top of their finances or actively working towards their financial goals are ideal for using the Personal Capital app!
I came across the app after hearing about it from financial bloggers as they recommend the app for being a resource in paying down debt, tracking spending, and watching investments grow.
Personal Capital Features 8 Great Features
GRADE: 10/10, A+
Personal Capital has cool features for tracking investments and educational information about fees and allows you to see your portfolio comparisons and returns vs. S&P 500, an index commonly used to track market returns.
Here are the Personal Capital features I enjoy:
1. Budgeting Tool:
The Personal Capital Budgeting Tool sees where your expenses are coming from, grouped by category Budgeting tool is useful because it allows you to make changes in spending habits. Knowing where you’re money is going can help to make cuts on unnecessary purchases to save more money.
>>See Also, Google Budget Template
2. Cash Flow Tracker:
Similarly, the app Cash Flow Tracker, a tool to see how much money is coming in vs. being spent. Cashflow is useful to monitor, because the more net cash you have to go in vs. gone out, the more you’re able to invest and take advantage of opportunities. Cashflow is vital to have bills accounted for, emergency fund, and build up assets
3. Investment Returns Tracker:
An interactive feature to show how your portfolio is performing vs. common indexes such as S&P 500, Dow Jones, or International funds. Historically the S&P 500 has returned over 7% after adjusted for inflation. This is the most common benchmark to see if your investments are keeping pace with the market. Networth Tracker/ monitor Assets vs. Liabilities. This feature is fun to see your network go up based on paying down debts and investments growing.
4. The Net Worth Tracker:
This is the best feature with Personal Capital (in our opinion). The networth tracker tool manages and monitors all of your assets and liabilities in one spot. Debts are liabilities. If you have more debt then investments, home equity, or other values, you’d have a negative net worth. However as you pay off debt and begin investing its fun to watch networth increase in accounts such as 401k, Roth IRA, accounts that will receive dividends, reinvestment, and compound interest.
>> How this Couple Increased Their Net Worth $300,000
5. Portfolio Analysis:
On portfolio analysis this feature lets you check your investments with Informative information about Asset Allocation, Cash, Bonds, US Stocks, International, Alternatives Large Cap, Mid Cap, Small Cap.
The portfolio analysis helps you recognize where you can improve and help you with hitting financial targets.
6. Fund Fees Analyzer:
The Personal Capital Fund Fees analyzer tells you what fees you are paying for your investments, including hidden or excessive fees. The analysis also tells you how much fees could cost you over time based on the expected 8% returns. The app has features to see the fees of investments. I am a fan of low fee index funds like Vanguard and can see my fund has a small fee of 0.04, which is one of the most economical cost funds.
Many mutual funds have much larger prices, which can make a significant impact on potential investment gains over long periods. As the app, many mutual funds have high costs and are not tax-efficient.
7. Check ROI Tracker & Portfolio Tracker:
Monitoring your ROI with the Personal Capital portfolio tracker feature that monitors returns vs. indexes such as S&P 500 an index fund of 500 biggest companies in US Stock market.
Index funds are a favorite of young people with time to invest, Bogleheads or F.I.R.E (Financially Independence Retire Early) community with bloggers such as Mr. Money Mustache, Grant Sabatier and JL Collins (The Simple Path to Wealth author), (JLCollins stock series articles written for his daughter), and other finance gurus like Ramit Sethi are big fans of index funds for low fees, historical returns beating most fund managers.
The app comes with a retirement planner, a way to monitor if you're on pace for your retirement goals.
All of these features are fun to track, especially as you make progress paying down debts, increasing investments, and seeing your net worth increase is a satisfying feeling. I love seeing transactions when my finances get dividends, that reinvest knowing that compound interest will build-up
8. Asset Allocation:
The Personal Capital Asset Allocation is an advanced feature that lets users see what sectors their investments are in based on percentages.
This allows me to diversify and add stocks and ETFs in other industries if I choose to balance portfolios in underweight areas.I enjoy this feature as I have learned about investing through app resources. (Though the closer to retirement you get you may get less aggressive more conservative in asset allocation, you may have more bonds or other asset classes in case of market volatility
As you can see in Screenshots above, using the Asset Allocation feature Personal Capital provides I am able to see how my investment allocation holds up against traditional allocations, like the S&P 500.
Additionally, I also get to see my allocations of Cash, Bonds, US Stocks, International Stocks,and alternatives.
How the Personal Capital App helped me in 3 areas:
Personal Capital has helped me with paying off my debt, saving/investing, and pursuing growth in net worth!
- I was able to monitor paying off 10,000 student loans and monitor my other expenses over a two year period.
- I am able to track my savings for accounts such as house downpayment. I also was able to check retirement Accounts such as 401k, Roth IRA and other accounts such HSA and a non-retirement account with Robinhood
- Lastly, watching my net worth grow helped me stay motivated to keep growing it!
The Case for Personal Capital
For me, the fun part after taking on debt and paying it off, followed by establishing a budget is saving up money and tracking investments and watching assets increase and liabilities decrease. It can be addicting in a positive way to encourage proper financial management.
Another favorite feature of the app compares your investments vs. S&P 500 (500 biggest US-traded stock companies) Goes into historical returns, fund fees, and asset allocation.
In my opinion, Personal Capital is the best app because you track everything.
You can budget, monitor your bank accounts, investments, and every transaction you make monitored. You can group spending into categories. Users have options of smart weighing to compare their investment portfolio vs. the S&P 500.
Personal capital is fun because it tracks your net worth and tells you how all your investments are doing which makes it perfect for finance geeks! The app does everything but monitors credit scores.
The app also has a Wealth Management option for people with higher net worth ($1 million-plus inevitable assets). The fees for this service looks to be a little under 1%
I used personal capital to achieve financial milestones, such as becoming debt free after paying off the last of my student loans and begin monitoring my investments returns.
Personal Capital is easy to track all your finances all in one place and they offer some sound financial advice in regards to index funds/mutual funds and fees.
Based on my experiences I recommend Personal Capital for anyone interested in improving their finances or staying motivated towards goals and financial milestones like increasing their net worth.
The feeling of seeing the hard work pay off, see potentially delayed gratification down the road is fun, and can be a competitive fun way to improve finances and celebrate small wins, and significant steps accomplishments in financial goals.
JD grew up in Des Moines, Iowa and ran college track before transferring to Iowa State to finish out his college career. JD claims he got his “Frugality” from his dad who also taught him about credit cards, saving money, and building credit. Personal finance is a passion for JD and he has an enthusiasm for finances. He regularly contributes to his workplace Roth 401k his personal Roth IRA, and loves finance apps such as Robinhood, Personal Capital, and Credit Karma! In his spare time, JD is an avid runner/biker!