Keeping tabs on your entire financial situation can take quite a bit of work — especially if you have multiple bank accounts, several outstanding debts, a handful of credit cards and a couple investment accounts.
Having a tool that brings all your financial information together so you get the big picture at a glance can be a game changer.
That, in a nutshell, is what Personal Capital does.
We’ve researched this personal finance app to show how it can benefit you as you try to stay on top of all things financial in your life. In this Personal Capital review, we’ll highlight the benefits and drawbacks of this tool so you can decide if it’s right for you.
What Is Personal Capital?
Personal Capital isn’t a simple budgeting app. It goes well beyond tracking your spending and sorting your transactions into budget categories.
Personal Capital is a wealth management app — with an emphasis on investing.
Founded in 2009 and acquired in June 2020 by Empower Retirement, Personal Capital shows you all your financial accounts in one place — your spending money, your savings, your debts and your investments.
When you log into the app, you can easily view your net worth (that’s your assets minus your liabilities). You can also see how your wealth is allocated — for example, how much of your money is in cash versus how much is tied into stocks and bonds.
Personal Capital has an investment checkup feature so you can see how your portfolio is performing and a fee analyzer feature so you can be aware of any expensive hidden fees you’re paying to manage your investments.
The app also has a retirement planner so you can map your way to the day you say goodbye to your 9-to-5. This feature allows you to see if you’re on track to retire by your target date and it’ll estimate what your retirement income will be. It can also show you how big purchases, like buying a house or paying for your kids’ college education, might affect your retirement goals.
Speaking of paying for college, Personal Capital has an education planner that shows you what you should be saving each month in order to send your kids off to school with minimal student loans.
While all those features are rather future-focused, Personal Capital also functions to help you manage your monthly budget and everyday spending.
When you set up a budget in the app, you can organize your spending by date, category or merchant. You can use pre-programmed budget categories, such as “food” and “entertainment” or you can customize categories to fit your unique life.
With your budget, you can see what percentage of your money is spent in each category. You can also track how your spending compares to the month prior.
If you use multiple bank or credit card accounts throughout the month (or you’re budgeting with a partner), Personal Capital helps you consolidate all your transactions so you see them in one place. Or you could choose to open a joint online account with Personal Capital Cash.
In addition, you can opt-in to receive a daily email outlining all your new financial transactions. That way, you won’t go weeks before detecting fraudulent spending on an old credit card — or an expensive impulse buy your spouse just made.
Personal Capital knows that saving money is an important part of monthly budgeting, too. Its savings planner feature helps you figure out what you need to put aside to build up your emergency fund or pay down debt.
How Does Personal Capital Work?
After providing a little information to create your account, you’ll be prompted to link your financial accounts — including your checking, savings, credit cards, mortgage, loans and investments. Personal Capital keeps your information secure with top-level data encryption, device authentication and strict internal access controls.
Once all your accounts are linked, you can set up your budget, establish your savings goals, check your net worth and start tracking toward retirement.
While many of Personal Capital’s money management tools are free, you’ll be charged a fee if you want to connect with a Personal Capital financial adviser to manage your investment portfolio. Clients must have at least $100,000 in investment assets and will be charged one all-inclusive annual management fee based on the size of their portfolio.
The Pros and Cons of Personal Capital
Personal Capital stands out from a lot of other personal finance apps by showing its users a comprehensive view of their entire financial situation.
If you want to track your spending and stick to a budget, it can help you. If you’re focused on monitoring your investments and getting set up for retirement, Personal Capital can assist you as well.
This app is really geared toward building wealth — elevating its users beyond simply getting monthly spending under control.
Over 2.4 million people have downloaded Personal Capital, and the app has a 4.7 rating on the App Store and a 4.5 rating on Google Play.
The fact that most of its services are free is another pleasant bonus.
The drawback of this app is that it’s not necessarily for everyone. If you’re living paycheck-to-paycheck and just need to focus on trimming down monthly expenses — rather than being constantly reminded of your negative net worth and how much extra cash you don’t have to invest — you might want to go with a free budgeting app like Mint or Clarity Money.
Another downside is that some users have reported problems syncing all their financial accounts to the app.
Who Is Personal Capital For?
Personal Capital is a great option for wealth-focused individuals or couples who desire a big-picture glance into their financial lives and want to be able to access information from multiple accounts in one place.
It’s an ideal choice for people who want a tool for budgeting but also for keeping up with their investments and saving for the future.
Nicole Dow is a senior writer at The Penny Hoarder.
This was originally published on The Penny Hoarder, a personal finance website that empowers millions of readers nationwide to make smart decisions with their money through actionable and inspirational advice, and resources about how to make, save and manage money.