Most people don’t track their expenses, emergency fund, debts, investments, retirement plan or overall net-worth. And of those who do track one or all of those recommended personal finance markers, everyone has their own method for tracking them.
Some use homemade excel spreadsheets, some use the classic pen and paper along with a collection of hundreds of receipts, some use individual apps to track each marker separately or some just let someone else deal with it completely.
Personal Capital
Personal Capital is a FREE, financial planning and wealth management app that is downloadable for any phone. The beauty of this app is its ability to create a one stop shop for all things personal finance.
Personal Capital features an award winning personal finance dashboard that allows anyone to track their finances from their phone or computer with relative ease. Personal Capital features a net worth tracker, portfolio oversight, risk assessment, cash flow analysis, budget tracker, recommended emergency fund, excessive fee finder, debt paydown planner and a retirement planning tool, all for free!
Personal Capital does offer pay for service wealth management and investment advisors. However, I have been using the FREE services for almost 3 years and have seen my net worth consistently rise year after year.
Sign Up for Personal Capital’s Free Financial Tools Here and get $20 for free.
What is It?
Basically, Personal Capital condenses all of your financial information from credit cards, loans, mortgages, saving/checking accounts, and investments into extremely easy to read and track graphs and spreadsheets.
It allows you to get the full picture of your finances without needing to jump between different accounts or apps saving you time.
Net Worth Tracker:
Quickly track your assets vs liabilities to determine if your current trajectory is on pace with your retirement goals.
This was the original reason that I downloaded Personal Capital as I had heard it was the best app on the market to track your net worth. But as I have used this app, it has evolved into so much more than just this function.
So now it’s the primary tool that I use for all of my blog posts related to my own personal finances. It’s easy to use and I know that all my information is safely in one place.
Portfolio Oversight:
Personal Capital allows you to track all of your investment portfolio in one place even if you invest with multiple different companies.
Up 10% in a pandemic, recession year… I’ll take it.
Many investment sites only provide this function for the money that you have invested with their company. This app however, allows you to analyze your entire portfolio regardless of if you invest in one company or multiple as most of us are.
For myself, because I have changed jobs so much with traveling, I currently have investment accounts with many different companies as you can see above. So seeing all my investments in one place is extremely useful.
Risk Assessment:
Personal Capital allows you to analyze your entire asset allocation throughout all of your different investment vehicles, providing you with a full risk assessment.
As you can see…I still love VTSAX
It also can break down your sector allocation, but because I invest in broad based index funds, this function isn’t as useful for me.
Cash Flow Analysis:
This function allows you to track your income and expenses, creating an up to date picture of your true savings rate.
7/1/20 to 7/14/20 income
2020: spending to date
Like in all the tools above, you can observe your progress for the month, the year, or any other custom date. You also can then compare your progress to the previous month or years. It allows for full customization while you analysis the data.
Budget Tracker:
Through this tool, you are also able to create a budget tracker allowing you to track your spending against your spending goals. It also functions to categorize your spending for you so you are able to see which categories of spending could be focused on and cut.
Recommended Emergency Fund:
Personal Capital also tracks your emergency fund for you, again consolidating it into a neat graph. It also recommends a target emergency fund based on your overall portfolio and current spending habits.
Excessive Fee Finder:
Through the use of the Cash Flow Analyzer, Personal Capital allows you to track any subscriptions/dues, service charges, or advisory fees. This allows you to keep track of any recurrent payments that are often hidden deep in our investment and banking accounts.
Thus allowing you to keep track of and minimize the amount of money you are paying out without your knowledge.
Debt Paydown Planner:
Personal Capital also allows you a full picture of all of your outstanding debt from each loan, mortgage, or credit card.
My Current Credit Card Debt Tracker
Since I only have credit card debt right now, below is a sample of what the loan and mortgage debt paydown planner would look like. It allows you to keep tack of all of your loans in one place, keeping you motivated and on top of your payment plan.
Retirement Planning:
Finally, Personal Capital offers a free retirement planning tool that allows you to track your retirement goals based on your income, spending, and trajectory. I personally feel it is a little conservative, but that’s probably a good thing.
I’ll take 73% odds to retire by 40!
Sign Up Now to Begin Planning Your Retirement!
How Does it Work?
To start, you need to link every account that you would like this app to track for you. Meaning you’ll link all investment accounts, loans, credit cards, and banking accounts. So for me, specifically, I link my savings account, checking account, 401k, HSA, traditional IRA, Roth IRA, and every credit card I have open.
Which seems like a lot, but the process is very easy and only requires your username and password for each account you connect. So in reality it only takes 10-20 minutes to set up if you keep your account information organized.
Is It Safe?
This is by far the biggest question that I get when recommending Personal Capital and rightfully so as it has access to all of your personal finance accounts.
The short answer is yes, Personal Capital is safe and secure. However, rather than bore you with the information about encrypted data, 2-step verification, fraud detection, and good security hygiene, I’ll refer you to a post by Millenial Money which outlines in detail the security and safety precautions that Personal Capital takes.
There is a reason that nearly 2 million people use Personal Capital as a financial aggregation tool.
However, nothing is 100% safe. That said, I fully trust and have trusted Personal Capital for almost 3 years without a single security issue. If anything, it lets me monitor all of my accounts in one place to better detect suspicious activity.
Sign Up Today For Free
Personal Capital is the best financial planning and wealth management tool on the market. You don’t need to have millions in your accounts to begin either. I started when I first began working, but in hindsight, I should have started using it in college to begin tracking my spending and loan accumulation.
Sign up and begin improving your financial hygiene and optimization now!
At the time of writing this, if you use my link below, you will get a $20 bonus when you link your first investment account!
