Personal Capital Review – New Investment Features And A Meeting With The CEO

Bill Harris, CEO of Personal Capital

Bill Harris, CEO of Personal Capital

After 3.5 years of using Personal Capital’s free financial tools to track my net worth, manage my cash flow, and optimize my investments, it’s finally time I do a unique review of Personal Capital from the perspective of an entrepreneur, an affiliate blogger, an equity shareholder, and a consultant for the past 17 months (Nov 2013 – April 13, 2015).

I’ve highlighted in previous posts how I use Personal Capital to reduce portfolio fees and how to run various growth scenarios to better manage your 401(k) for retirement. Now I’d like to share with you some thoughts about the company after spending over 1,500 hours consulting with Personal Capital. On April 13, 2015 I officially started my new role as a special advisor to the firm.


One of my main concerns as a affiliate is the viability of the product I’m highlighting to readers. I’m inundated with product affiliate offers every day and decline 99% of them either because they are not value added, not well presented, or don’t have good usability. Your time and my time is valuable, so I only want to highlight the most useful products that will provide the most value.

The last thing I want is for the company I recommend to shutdown like Adaptu did in 2013 or Manilla in June 2014. Businesses fail all the time for many reasons, and it’s my goal to highlight long term product winners on Financial Samurai. To keep trading in and out of stocks (switching products) is a very suboptimal use of time and money.

Personal Capital recently celebrated its $1 billion in client assets under management milestone on January 20, 2015. This is a huge milestone the demonstrates Personal Capital’s legitimacy as one of the premier digital wealth advisors. The first $100 million took several years to accumulate, and the second $100 million took under one year by June 2013. As of mid-2015, the firm now has close to $1.5 billion in managed client assets.

Personal Capital offers free wealth management tools available for all of us, but only makes money when users elect to have at least $100,000 in assets managed by Personal Capital’s wealth advisors for 75 – 89 bps annual fee of assets. In a financial world dominated by big brand names such as Fidelity, Merrill Lynch, and Charles Schwab, Personal Capital’s biggest challenge is to answer a consumer’s question, “Why them?

Personal Capital’s competitive advantage is that they built their company from the ground up with technology at its core. As a result, they are much more flexible in tailoring offerings to meet consumer demand. By implementing a work force of financial advisors across the country on top of its technology platform they can leverage their proprietary financial planning software to help customers and more easily convert existing customers to participate in managed services. In other words, they are a technology-assisted registered investment adviser (RIA).


Given my background in finance, I always automatically approach a company as a potential investor and not just as a financial writer. I’ve got a couple private equity investments that are doing well, and I’m always looking for more if they’ll have me. Personal Capital closed a $25 million Series C funding in the summer of 2013 led by Crosslink Capital with participation of asset management giant BlackRock and previous investors Venture Partners and Venrock.

The continued ability for a company to raise money is always a good sign. But the most bullish point from an investor’s point of view is BlackRock’s participation since they manage over $1 trillion in assets and are not just venture capitalists. I’m sure BlackRock is figuring out ways in which they, too can leverage technology to gather more assets under management. By becoming a minority investor in Personal Capital, they are more privy to their technology. Furthermore, if Personal Capital ever decides to sell their entire company, BlackRock will surely get first dibs due to their long standing relationship.

In October 2014, Personal Capital raised $50 million in a Series D round led by USAA, Corsair, and BBVA. USAA is one of the most respect financial institutions in the world and I’m very happy they’ve taken the lead. The total amount invested over the four year old company comes out to $102.3 million. Personal Capital is very well capitalized and here to stay.

Personal Capital currently has over 800,000 users with in excess of $100 billion assets being tracked on the platform (as of 2Q2015). They actively manage roughly $1.4 billion in assets under management and are growing at a 10% month over month clip. The entire wealth management market is roughly $32 trillion for individually managed investable assets in the US. The upside is huge.

In Silicon Valley, it’s all about B for Billion. Who is going to create the next billion dollar+ company? I believe Personal Capital will get there over time and I would invest in the company if I could.


Bill Harris, CEO is obviously financially independent after his time as CEO of both Paypal and Intuit. So I’m always curious to know what makes someone who doesn’t have to work still work so hard. I’ve asked myself these same questions before in posts such as, “Overcoming The One More Year Syndrome,” and “How Does It Feel To Be Financially Independent.” I still spend hours writing posts, visiting companies, and responding to comments on Financial Samurai despite the six figure passive income stream developed after 15 years of work.

What makes Bill tick is the desire to create something out of nothing and see things through until a successful outcome is achieved. Bill says, “Personal Capital is a culmination of my career.” Although Bill was CEO of Paypal and Intuit, he didn’t create Paypal or Intuit. As a co-founder of a company, there’s nothing more satisfying than seeing your baby grow into something meaningful. Perhaps the situation is analogous to being a biological father vs. a stepfather. You’re still proud of your child no matter what. But if you have adopted children (a company you lead, but did not found), then you’re always going to be curious what it’s like to have a biological child to raise as well.

It seems obvious to me that Bill’s main goal isn’t about making more money for himself, but about making Personal Capital the best online wealth management product possible. “Charles Schwab disrupted the wealth management industry 25 years ago. I think we can do the same with Personal Capital today,” says Bill. Here’s a short video from Bill describing his vision of Personal Capital.


Personal Capital has brought their online platform mobile with new app launches on iOS and Android lead by Jim Del Favero, CPO. The main feature that has saved me the most immediate money is Personal Capital’s Investing tab which analyzes your portfolios’ risk metrics, asset allocation, and fees.

I ran my 401(k) through Personal Capital’s 401(k) Fee Analyzer and it showed I was paying $1,750 in annual portfolio fees I had no idea I was paying thanks to a very expensive Fidelity fund. I ended up selling the fund and transferring assets into a Vanguard Large Cap fund which cut my annual portfolio fees down by 80%. I highly recommend everyone run their 401(k)s through the 401(k) Fee Analyzer as well to get an idea of how much fees are robbing you of your retirement years and portfolio performance.

Personal Capital is making their Investing tab more educational and interactive for users. Take a look at the screenshot below of my latest rollover IRA allocation. The first thing that should jump out at you is the enormous percentage I had in cash after I took profits on the majority of my holdings recently. My rollover IRA is my punt portfolio where I’m fortune hunting for high growth stocks. Such an extreme allocation of assets serves nicely to explain the following new investment analysis charts that Personal Capital now provides.

Personal Capital Investment Checkup Tab

What you’ll notice in the Allocation Comparison chart above are the new “Target Allocation,” “Historical Performance,” “Future Projections,” and “Risk & Return” tabs along with the target allocation and current allocation bar charts based on investor profile questions I’ve answered when I first signed up. You are always able to take the questionnaire again if your risk profile changes.

Personal Capital Historical Performance

The above Historical Performance chart basically shows how my existing cash heavy portfolio would have performed since 1992 if I kept the allocation the same. Much less volatile, but much less money! Let’s take a look at the next chart to estimate future performance.

Personal Capital Future Projections

The above Future Projections tab shows how I am projected to have $400,000 less in retirement than projections if I keep my existing portfolio allocation. What’s interesting is that the “10% Worst Outcome At Retirement” for my Current Allocation is still WORSE than a higher risk Target Allocation. The more proper point of comparison is to compare Current Allocation with Current Allocation and Target Allocation with Target Allocation. Once you do, you can see a wider volatility. The Future Projections is based off the initial recommended asset allocation based on my own risk metrics.

Risk Return Personal Capital

The above Risk & Return chart shows where I am on the Efficient Frontier Curve. The Efficient Frontier represents the best asset class mixes. Based on historical results, it is the set of allocations which offer the highest expected returns for each level of risk. The idea is to be on the curve, and not below or above the curve. The example used in the Personal Capital video discusses an umbrella store which could improve its sales returns by adding sunscreen on its shelves during the summer. As you can see from the chart, my current allocation is below the curve.

Personal Capital Recommendation Of Assets

The final chart shows the actual hard dollar target allocation amounts to be deployed on the Efficient Frontier curve. The tricky thing to figure out is which index funds to buy to achieve the best allocation for the best risk-adjusted returns over time. This is where Personal Capital’s financial advisors can hep you, or where you can do research on your own.

It’s important to realize that outputs depend on inputs. The recommended asset allocation Personal Capital spits out depends on your individual risk tolerance as determined in the initial questionnaire profile. The beauty of Personal Capital’s software is that it can make tailored recommendations for each user.

So how do you replicate the above charts for your own portfolio? Easy. All you have to do is link the portfolios you want to screen onto Personal Capital’s dashboard and then click the Investing tab in the top right and then click Investment Checkup. Personal capital will automatically produce the above charts and recommendations for you. You can also toggle between individual portfolios to do the same analysis e.g. 401(k), after-tax portfolio, etc.

The Best Retirement Planning Calculator Today. On 6/22/2015, the product team came up with what I think is the best retirement calculator on the market because it uses real data and Monte Carlo simulations to come up with the most realistic financial scenarios for your future. Other calculators simply ask you to guess input values to then come up with your financial future. The problem with this method is that we often underestimate how much we are saving and spending! You can input different life events such as a wedding or home purchase in your cash flow statement and recalculate your financial future to see how you’ll do. Everybody should give it a try.

Personal Capital Retirement Planner


Award Winning Technology – Personal Capital can be used on the computer, tablet, or smart phone – iOS and Android. I speak with the CPO, Jim Del Favero on a monthly basis because I’m a consultant and he keeps me in the loop. Next up is integration with Zillow for real estate valuation tracking, which will be great.

Easy To Use – All you’ve got to do is sign up, press the “+” to link all your desired accounts, fill in the respective user names and passwords and everything will get downloaded on the Personal Capital dashboard.

E-mail updates – Every week you’ll get an e-mail update of your net worth, the latest Personal Capital news, and a snapshot of the markets. You can also subscribe to Daily Capital, the Personal Capital blog to gain insights.

Tax Loss Harvesting – Personal Capital practices tax loss harvesting and tax location for their clients. Tax loss harvesting alone gains up to 1% in after tax return a year.

Smart Indexing – Smart Indexing aka Tactical Weighting is the practice of investing in equal weighted sectors or styles. In bull markets, one sector can grow to an outsized percentage, such as during the dot com bubble or the financial bubble. When the market corrected, people lost a lot of money. But if they practiced Smart Indexing, by constantly staying disciplined with equal weightings in the sectors, they would have outperformed.

Award Winning Content – Personal Capital also produces some of the best personal finance content on the web for all its users. I’ve been the Managing Editor of the blog since November 2013, and the goal is to entertain, educate, and boost reader’s net worth.


It’s really amazing how many free resources we have at our fingertips thanks to technology and the internet. Managing our own money has never been easier. The business model of leveraging the internet to gather assets under management makes a lot of sense due to scalability. The key for Personal Capital is hiring enough financially savvy financial advisors and continuously innovate their technology platform.

I hope after spending three years as a user of Personal Capital, highlighting various ways in which I use Personal Capital’s tools to create more wealth, and spending over a thousand hours meeting with senior management, research, and the advisors that I’ve provided the most comprehensive Personal Capital review online. There’s no other personal finance blogger who has the experience and insights to be able to write as thorough a review.

If you’re looking for a great way to track your net worth, analyze your portfolio fees, manage your cash flow, and get a handle on your finances, I recommend signing up for Personal Capital and linking your accounts. It’s free and is empowering people to take control of their wealth. May 2015 be the year that you super charge your net worth and gain a little more financial freedom!

Updated on July 24, 2015



Sam started Financial Samurai in 2009 during the depths of the financial crisis as a way to make sense of chaos. After 13 years working on Wall Street, Sam decided to retire in 2012 to utilize everything he learned in business school to focus on online entrepreneurship. Sam focuses on helping readers build more income in real estate, investing, entrepreneurship, and alternative investments in order to achieve financial independence sooner, rather than later.

You can sign up to receive his articles via email or by RSS. Sam also sends out a private quarterly newsletter with information on where he's investing his money and more sensitive information.

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  1. Julian says

    Hey Sam,

    Enjoyed the piece on Personal Capital. I have explored the possibility of becoming one of the advisors you speak of. Couple questions here:

    1. Why wait if you’re Blackrock?

    2. In your opinion how does Personal Capital compare to Betterment, Learnvest, etc.?


    • says

      You’ll enjoy my upcoming post on financial advisors this week. Stay tuned!

      1) Allocation of resources probably. PC is still very small, so BR may simply be waiting to see if they gain traction before taking a bigger stake. I’d say the $1 billion managed assets mark is when Blackrock and other big wealth management companies will start taking more notice. Then of course it’s getting existing shareholders to sell. If they think PC can grow to multi-billions managed assets, then selling too soon is suboptimal.

      2) PC allows more DIY opportunities given its tools. A lot of finance is about spending the time to understand things on your own and discovering your risk tolerance. I’ve not used Learnvest and others before.

  2. says

    Sounds like you had a great box of macaroons. Oh, was there more to this post than that?

    I think Personal Capital has really brought a lot of desirable features to the table with the fee analyzer as well as being the investment version of Mint. Of course the money is to be made from the assets under management. As you have said branding and exposure is really what will grow those assets. Best of luck with the future affiliate relationship and possible private equity deal (naturally we’d all love to know the details of that).

    • says

      As a writer, I thought it’d be fun to throw in the macaroons provided, in the post. I shot PC a Tweet saying I was on my way down and hope they provide cookies. Macaroons are close enough!

      They won’t want my piddly private equity money. They’ve got the big boys jumping in already. I just like to approach companies with an investor’s mindset as well. Makes me think critically of different things.

      • says

        I should clarify to say “private equity deals” so as to express the desire to read about any you might be involved in. You have tremendous connections, resources, and access out there on the west coast and could give an outstanding view of how these deals go down, and your viewpoints on why it is a great investment or not.

        • Dave says

          OP – I too would enjoy a write up of any current or past pe deals you have looked at and the resulting analysis there of. As it seems that most PE firms (and angels) bring either money or connections (and usually both) to the deal. In addition, I would be interested in hearing how one gets to that point where they could do PE or angel investments.

          • says

            Hi Guys, the issue with private equity investments is that it’s private. Private companies don’t want to disclose their financials to the world and to competitors. Also, many of these deals are limited to only accredited investors, which I fear will ostracize and maybe anger people for the exclusion. A private deal analysis is much like a public company analysis, just with more assumptions.

            Definition of accredited investors:

            1) A natural person who has individual net worth, or joint net worth with the person’s spouse, that exceeds $1 million at the time of the purchase, excluding the value of the primary residence of such person;

            2) A natural person with income exceeding $200,000 in each of the two most recent years or joint income with a spouse exceeding $300,000 for those years and a reasonable expectation of the same income level in the current year;

  3. says

    I’m a huge fan of Personal Capital and use it currently (although only as a tracking tool). I think the company has great upside potential and look forward to seeing how they perform. Great article.

  4. Austin says

    This is a great article and Personal Capital is a great tool. PC’s approach is unique, timely and has the potential to play well to a new generation of investors.

    I started using Personal Capital because wasn’t performing up to par. That said, I was using the platform as an analysis tool and not looking for financial guidance. With tools like we take for granted that while we are really putting an incredible amount of personal information forward we assume that no one is really scrutinizing our individual accounts. Not so with PC. PC employees will attempt to contact you multiple times. To be frank, for technology users today, it can be a little creepy to think that there really is a man behind the curtain on the app you downloaded and they are looking closely at your vital statistics. This is not to take away from PC, but I think it is a hurdle they will have to overcome in their attempt to gain momentum.

    Another hurdle I think they may need to overcome is the one of personal touch. Regional offices may be the key to awareness and acceptance of this unique model. I am not a HNW individual. So, I am automatically suspicious that the JV is being assigned to my account. Couple that with the experience being impersonal and you have the groundwork for inherent distrust. Sam is spot on that a marketing push with a headline manager might be the momentum needed.

    As an aside. I wonder if younger generations have grown to inherently distrust firms like Edward Jones, Morgan Stanley et al. post 2008. If this were true it might be beneficial for PC to look to brand themselves as a different animal.

    • says

      Good point about Personal Capital not having the legacy baggage of the bigger Wall St. firms post financial crisis. PC can sculpt their brand the way they see fit. But it’s important to do so sooner, rather than later given the sea of well-funded competition. We talked about branding for about 30 minutes in the meeting.

  5. J. Everett says

    Thanks for the read! I started using Personal Capital a few months ago and love it. I logged in today before reading this post and was elated to see the new tools they have made available. One thing I would suggest. As a 22 year old user, I feel that the road to financial hell is paved with re-occurring costs, and although I love Personal Capital, I would be more apt to pay for their services if they had a scheme besides the 1% of assets managed fee. I have never used a financial adviser, so I don’t know if this is a standard fee, but I do know that over my working career and life that fee would take easily a million dollars from my future net worth, and although one may argue that their services would add more than that, from my position I don’d really see that. Maybe if for a flat rate I could purchase time from one of their advisers, or if I could upgrade to “premium” whatever that would be for x dollars a month. I say this knowing that I may not even be the type of person they are trying to market too since my net worth only broke into 6 figures within the last year. Just a thought, this company is really exciting to me, again thanks for this and all other posts.

    • says

      A flat rate structure is actually a better deal for those with bigger assets. What I would do at 22 is to simply track your portfolios, study the charts, play around with the assumptions and see what fits you best. Your risk tolerance will change over time so it’s best to stay on too of things.

      Have fun! That’s what the PC tools allow. It’s fun to dream of all our riches if we make X return over Y many years. Motivating to keep on track.

  6. says

    The Personal Capital 401k fee analyzer is a fantastic tool. If you are a participant in a plan, dont be hesitant about letting your employer know about your findings. They often have the largest balance in the plan, so you’ll be helping them as well. Employers are required to benchmark their plan against alternatives annually anyway, so a fresh perspective may be good for everyone

  7. Jason says

    I’ve tried their site and it seems good for someone that’s very into stocks and bonds. But, as of just a little while ago, they didn’t really have much for tracking real estate assets, rent collections, mortgage balances, etc. So, it wasn’t of much use to me.

    Maybe I’ll revisit them in a couple of years to see if they’ve beefed up that portion of their product.

    • says

      It tracks mortgages, but yes, PC is more geared towards stock and bond investing.

      Perhaps they’ll develop real estate investor tools and screens in the future.
      I’ll suggest it as RE is a core part of many people’s net worths and retirement strategies.

      • Jason says

        I’ve mentioned it to them as well before I closed my account. They said they were working on it. I’m not holding my breath, though, especially since their business model is centered around stocks. There’s just no incentive for them to do it, unless they can monetize it. (They’d need to establish partnerships with lenders, turnkey vendors, etc… a lot of work to do there)

        But, if they want to do something about it, I’d like to see the following:

        * Property valuation updates (maybe an average of zillow and another site combined with some numbers from a CMA)

        * Real-time pulls of mortgage balances

        * Ability to identify bank line items as “rental income” to track gross rents

        * The ability to mark bank line items as “investment” or “expense”. Right now, the online tool I use is horrible and “alerts” me with ridiculous messages like “Large expense detected this month!” and “You are over budget with expenses on your home!” Thanks, Captain Obvious.

        * Linking of initial investments with above-mentioned items so that you can track ROI by property, all automatic after this initial linking is done.

        Oh, and while I’m at it, I might as well wish for all the children in the world to join hands and sing a song for world peace.

        Maybe I’ll build it myself after I retire. :)

  8. JC says

    I use it for analyzing purposes and think its great. I just rant the “investment check-up” and received this message: Due to a high level of unclassified assets, we cannot analyze your portfolio with reasonable accuracy. They cant seem to classify my bonds (muni and zero’s) and it falls under the “other” category. That seems silly. I guess because the “other” category is a nice chunk of my portfolio they cant run the check up.

    I also took a few calls with them regarding them managing some money. Ultimately I decided not to move forward because they have a very limited track record. I agree, that having a CIO who has a long resume would be helpful. Their philosophy aligns with mine in that 1. they believe in low fees and therefore use almost all ETF index funds and 2. they believe in equal weight and not cap weighted buys, so they allocate money by adding to laggards or companies that market cap isn’t overly a larger % of the index (example not adding $ to apples % of the nasdaq but adding at an equal %) which results in buying low and selling high.

    Besides the lack of history, the ETF’s I buy almost all have fees of .10-.50% and I enjoy managing my portfolio. These are the same ETF’s they will buy anyway, but you pay for the execution, advice, and discipline. Also no commissions. Not too bad for 1%. For passive folks this is a good deal.

    • says

      Interesting that the system is having a tough time classifying your bonds and munis. That’s good feedback which I think they’ll appreciate. They got a feedback box on the dashboard.

      It’s all about screening and running pro forma scenarios which I love as a DIY investor.

  9. Micro says

    It’s been a bit since I played with Personal Capital’s analysis tools. I think I’m going to have to swing back over there and play around a bit. Especially since I just passed a threshold for my account at Vanguard and the expense fees on my index funds are now lower. :)

  10. says

    That’s so cool you got to meet the CEO and learn more about their business. The new features look really cool. I didn’t realize that Blackrock invested money in Personal Capital. Very cool. Time for me to log in and play around with the new tools now. Thanks for the insights and tips Sam!

  11. says

    Talk about a thorough review! I’m in the process of figuring out how I want to start investing outside of the 401(k) and mutual fund I currently have. Consider Personal Capital’s hat in the ring!

  12. Steve says

    Hi Sam, Great article. Just some ideas for the next time you get together with the PC team. Since investing is so closely linked to budgeting and lowering living cost improves the amount we have to invest it would be great if PC could add some budgeting tools to the website. The classification of expenses helps but doesn’t let you run any budgetary graphs for the year or simulations over multiple years. The example of your switching to IC light bulbs and other energy savings could be run in models for budget planning. Then all of the improvements could roll into potential investment gains showing the impact of the extra invested money. Also when saving an expense to a new category in PC it doesnt recognize future expenses to the new category. If there are other budgeting tools that can be linked to PC let me know please. Thanks again for your tips.

  13. Mr B says

    Spent a good amount of time working with their advisers and frankly I haven’t gotten much information from them that I couldn’t of gotten from blogs or anyhow. And I don’t know (particularly) much about personal finance, but I am semi-fluent. The advisors seem to know the same if not a bit less than I. Either that or they are instructed not to advise beyond reiterating the company’s overall investment approach to asset allocation. I’m thinking I could save half a point by just allocating my funds to equal weighted domestic/intl ETFs… with nearly identical results.

    Sam I presume you do not use their service other than for tracking purposes…?

    • JW says

      BTW, Sam if you talk to them again (or when you do), the could make some improvements around their tagging of transactions to categories so the software learns my spending habits – i.e., can if i tag an amount as something specific (not initially intuitive) could the software remember that assignment (based on dollar amount, payer/payee, and date), and add budgeting functionality.

  14. says

    Totally agree with you that the brand needs a face. I believe it’s the missing link for many of these online advisors. Either a prominent money manager or someone from the academia world!


  15. Marko says

    Just talked to PC Advisor… The good thing is that all you need is to give them $100,000 to manage in their account for 0.95% fee… Than, for all of your other accounts (your employer 401k, fidelity 529, any other account- they will set up your portfolio and tell you what funds to buy/ sell/ when etc for free.. Seems like a pretty good deal to me…

  16. Jon Gupton says

    Do you think Personal Capital is better than Betterment or Wealthfront and why? The fees are higher, but it seems P.C. isn’t so “cookie cutter”?

    • says

      Hi Jon,

      It’s a different target demographic really. Betterment and Wealthfront are 100% algorithmic advisors i.e. there is no human to get advice from and speak to about retirement savings, college savings, tax planning, outlook on the market, etc. That, to me is valuable b/c I’ve gone through multiple up and DOWN cycles in the market.

      Robo-advisors are thriving now because anybody can make money in a bull market. It’s what happens when things aren’t as rosy that makes having some human advice very helpful. The roboadvisor fees are very attractive though compared to alternatives. It’s not a bad way to diversify a portion of you investing assets.




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