If your current budgeting software isn’t cutting it anymore, then it’s time to try something new. You’ve tried Mint and really like it but it doesn’t offer the wealth building features you’re looking for. The Trends feature is clunky and it mainly focuses on budgeting.
Quicken is great too, but you have to pay to access the software. It has great spending and income tracking features, but again, focuses on the penny pinching aspect of money and doesn’t show the full financial picture. Plus, Quicken’s always have software bugs or update issues.
As 5-year long Mint user I’ve been ready for a change for awhile. Then I found out about Personal Capital at a conference last year, and even got to meet their team in person. So I decided to make the switch from Mint user to Personal Capital last July, and couldn’t be happier.
I love so many of their features and especially the fact that I can track my spending, cash flow and even retirement accounts to see how they contribute to my overall net worth. But enough about how I like Personal Capital, you can try it out for yourself for free!
What is Personal Capital?
Personal Capital is actually a pretty well-established startup with over 1 million users. It’s a direct competitor to Mint and Quicken. They offer free money management and expense-tracking software that’s a level up from what’s out there.
While Mint mostly focuses on budgeting and spending management, Personal Capital showcases your overall financial health, net worth and future goals.
The software also has investors in mind with much more comprehensive goal tracking, especially for long-term goals like saving for retirement. Their goal is to make personal finance more accessible, affordable and transparent for everyone.
If you feel like you’ve outgrown Mint or Quicken and are ready to really pump up the volume on your financial goals, I highly recommend you check out Personal Capital. Is it free afterall.
How to use Personal Capital
Using Personal Capital is actually quite simple to get the hang of, at least it was for me. It took me months to figure out how to use Mint.com properly but with Personal Capital I figured it out quite quickly.
They have limited but excellent features so you’re not overwhelmed. And it only takes a few minutes to get started.
1. Link your accounts
When you first login you’ll see all of your accounts on the left side menu, under the My Accounts tab. This is where you’ll add your various checking accounts, credit cards, loans and investments.
It only takes about 15-30 seconds for Personal Capital to find your corresponding account and sync your transactions. Once you’ve added all your income and expense accounts, along with any retirement or investment accounts, you’ll want to add any other assets in your possession.
Things like a vehicle, art or a real estate property, will all give you a more accurate picture of your net worth. If you don’t know the exact value of your car, you can get an estimate from Kelly Blue Book website.
2. Categorize income and expenses
Now that all your accounts are synced to Personal Capital, you’ll be able to see your spending and income transactions.
It may take a few minutes to organize your transactions into the various categories, but you can use the Edit multiple transaction button to speed up the process. Then once you finish it will be easy to see your spending habits and other goals.
One of the things I really like about Personal Capital’s expense categorization is that you can easily find expenses related to tax deductions, like medical or business related expenses. That way you’re not spending hours and hours at the end of the year trying to add up your tax deductible expenses.
Obviously having tax related expense tracking is a really important feature to me — hello tax geek! 🙂
3. Set monthly spending goals
Unlike Mint, where you create monthly budgets for each spending category, Personal Capital allows you create monthly goals of what you hope to spend across the board.
You can also track your income using their Average Spending Calculator. All of which is available in their mobile app as well.
4. Monitor your investments
One of the main advantages to using Personal Capital versus Mint or Quicken is the fact that you can monitor your investments in a much more in-depth fashion.
After logging in you can view your Gains and Losers at-a-glance, your portfolio’s current allocation and even how your investments have performed over a specific period of time.
With Personal Capital you can monitor investment and retirement account:
- Net worth
- and more
5. Discover hidden fees
In addition to monitoring investment activity, you can also use the Investment Checkup, Retirement Planner and 401k Fee Analyzer to see if you’re on track financially. Personal Capital will tell you how much you should be saving for retirement based on your goals, and make adjustments accordingly.
You can also discover hidden fees within your investment portfolio or 401k, then work with Personal Capital to eliminate these unnecessary fees so you can keep more of your money for spending in retirement.
6. Access financial reports
Finally you can access reports by choosing a custom date ranges for spending, cash flow and investments for the last 30 days or more. Transactions can be exported to a spreadsheet based on cash-only, credit or loan accounts or retirement accounts.
You can also search through your list of transactions to find a specific one. And did I mention you can get all of this for free? Pretty awesome!
Personal Capital’s mobile app
They also have an award-winning mobile app that’s, quite frankly, the best I’ve ever seen — and it’s free too. It has a clean layout and simple functionality, and almost rivals the web version.
It’s perfect for the location independent freelancer who needs help managing their money on the go, which is one of the reasons I like it so much.
How does Personal Capital make money?
Since the basic services are free, you’re probably wondering what’s the catch? The main draw to using Personal Capital isn’t going to be tracking spending or budgeting, or paying off debt — although you can do easily do all of those things.
The software is particularly aimed at high net worth individuals and investors who are trying to build wealth, not necessarily count pennies.
If you’re ready to dive into the investing world, Personal Capital will help you start and manage a personalized investment strategy via their portfolio management service. They charge less than 1% management fee which includes investment advice, portfolio management, custody and trading.
Personal Capital will also help you avoid fees through their Fee Analyzer and maximize your tax savings via tax optimization.
So basically, Personal Capital makes money when you make money via your investments and other wealth building strategies. You do, however, have the option to decline and simply use the free core service to monitor everything on your own.
What would make Personal Capital better?
There are a few things about Personal Capital that I don’t like. Not every money management software is perfect. Personal Capital doesn’t allow you to add your own income and expenses categories. So you’ll have to use the categories that are already provided with the system and make do.
This can be frustrating if you’re trying to divide up different types of income, for example. Or want to categorize your internet bill — seriously why don’t they have a category for this?
They only have one for TV/Cable and that’s not what this is. You also can’t differentiate between the different types of insurance that you have, like health insurance versus car insurance, as there is only one lump category called Insurance.
Personal Capital doesn’t allow you to split transactions or delete any either, which can make accurate cash flow a problem.
Even with these small issues, my husband and I still really like using Personal Capital. I recommend starting out with Mint and Betterment and then graduating to Personal Capital as you feel ready to level up your money. That’s what I’ve done in the past five years.