Personal Capital is one of our favorite personal finance software for a reason. While we think Mint is a decent budgeting tool for personal finances, it’s inadequate when it comes to net worth tracking or investment planning. Mint generally targets users who are just starting with their finances, while Personal Capital is more advanced and offers better features.
To find out more details of the pros and cons, check out our in-depth review of Personal Capital. However, if you’re ready to get started with a free account, below are step-by-step instructions, as well as how the entire process works.
Step 1: Create a New Account with Personal Capital
Personal Capital is a popular web-based financial software that offers tools to help you invest smarter by aggregating all of your financial accounts in one place. You can monitor your net worth and investment activities, set goals, create a budget and track expenses.
With this service, which is also available as a mobile app, it takes only a few moments to set up a free account.
Then the software will ask you questions such as when you expect to retire and how much you currently have invested. This is intended to help you evaluate your current financial and retirement goals in later steps.
Step 2: Connect and Sync Accounts
Once your account is set up and complete, you’ll need to link all of your financial accounts, including checking, savings and investments. Personal Capital syncs with thousands of popular financial institutions, so yours should be easy to find.
If you can’t find your bank, simply enter the name in the search bar. Personal Capital is adding new financial institutions all the time, so don’t get discouraged if your bank isn’t on the list.
Step 3: View Current Cash Flow and Net Worth
After your new account is set up and your financial accounts are synced, you can then see a snapshot of your net worth and cash flow, both of which are easily viewed within the dashboard. Scroll down to see graphs of your spending and cash flow from the last 30 days, as well as the balance of your entire portfolio and its allocation status.
Clicking the “Banking” tab and choosing “Cash Flow” will bring up a new screen that allows you to organize and categorize your income and expenses. You can choose to do this with either all accounts connected or specific accounts that are checked off. You can also toggle the buttons from income to spending, or both.
View and track bills that are currently due by clicking the “Banking” tab and choosing “Bills.” If you have a credit card or other bill due, you should be able to click the link directly and head to the account website to make a payment.
The “All Accounts” tab will lead you to a summary of your net worth, which includes all assets (such as savings or retirement accounts), liabilities (such as credit cards) and investment accounts. Toggle between cash, credit, mortgage or other loan account tabs to view your current standings. Doing so will give you a 90-day history once your account with Personal Capital has been live for that period of time.
Step 4: Check Out the Investment Features
Now that your personal income, expenses and bills are squared away, it’s time to really get into the fun of using Personal Capital: the investing features! Under the “Investing” tab, you can choose to view your entire Portfolio, perform an Investment Checkup, use the Retirement Planner or Fee Analyzer, or check out the upgraded Investor Services.
The Retirement Planner is a brand-new feature that’s becoming very popular. We even wrote an entire article about how to use it and its benefits. Basically, it gives an answer to the often-asked question: “Do I have enough saved for retirement?”
Personal Capital’s Retirement Planner gathers information based on your personal spending and saving habits and formulates a forecast of what your money will look like in retirement. This will help determine if you’re on track or need to spend less/save more.
This feature is especially amazing because it’s a personalized look at your investing and retirement options, without having to pay money to a financial advisor to create a personal plan. And best of all, it’s free with your free Personal Capital account.
The “Portfolio” button brings up a screen that allows you to view your portfolio’s performance, allocation, balance and sector type. View by single account or all of them combined, as well as by type of fund or stock.
The Investment Checkup section will review your current holdings and show whether or not your projected portfolio growth is in line with your preferred date of retirement and other income factors. You can view several different factors including, history, performance, future projections, risk and return, and allocation comparison.
The software will then offer a recommendation for target allocation based on your personal risk factors and current asset allocation. It’s up to you whether you want to follow this advice, but it’s offered as an additional option.
Lastly, the Retirement Fee Analyzer displays how much you’re paying in investment and management fees for the different robo advisors or brokerage accounts you have. Move the scrolling bars up or down and you can see how much you’ll be paying in the future, for the life of your investments, as well as the percentage of earnings lost.
Personal Capital reveals how it calculates these results using a simple formula.
Step 5: View Recommendations and Take Action
The best part about using a free service like Personal Capital is that you use the information it offers to take action toward improving your investment or retirement plans. In order to retire comfortably there are certain financial milestones you have to hit, and Personal Capital’s personalized advice will help you accomplish this.
If you don’t feel comfortable making these adjustments yourself, Personal Capital does offer Advisor services for a fee, resources via the blog, and other research for you to determine the best financial moves for your personal situation.
Once you’ve linked more than $100,000 in total investment account balances to your Dashboard, you will be assigned a complementary personal Financial Advisor who can help you further.
For these reasons, we believe Personal Capital is a much more well-rounded finance program than Mint.