Personal Capital call Friday

[Outside the Box]

I got the semi-regular "we haven't talked to you since 2014" call from Personal Capital today since they think they can get some of my money.

Mainly so I can hear the updated version of their sales pitch, I allowed them to schedule it for Friday. I'll update this post after the call with anything interesting or with any answers I might get to questions here.

Mustachians, anything you want me to find out that I might not think to ask?

I already know I don't like their strategy, since it involves using individual stocks instead of index funds, and their expense is high to me compared to an indexing strategy on autopilot.

[ysette9]

I'm surprised you are wasting your time. They leave me a voice message about once a quarter or so, and I always imagine them salivating over my account balance. There is nothing they can tell me at this point that would cause me to change my investing path.

[Outside the Box]

It's 30 minutes of entertainment for me. I last endured it in 2014.

[waltworks]

I hung up on the lady after about 20 seconds. She then emailed me to "thank you for the humbling experience of being hung up on. That has never happened to me in the finance industry."

Am I just a huge jerk or what?

-W

[Outside the Box]

I mean... did you schedule the call and then hang up once it began? Or did you just hang up on the scheduling call person?

I've always said "no thanks" to the scheduling person in the intervening years and they never gave me a hard time. They said they'd just check back in a year or so if that worked for me.

They pay for the free service with paying clients. You don't owe them listening to the spiel, but you could just say "no thanks" and ask them to add you to their do not call list.

[waltworks]

No, no scheduled anything. Just a cold call "hi I'm so and so from Personal Capital" at which point I hung up.

So yeah, I'm a jerk. In my defense I run a business and get a TON of spam calls that start the same way "Hi I'm so and so..." and I just sort of reflexively hang up...

-W

[Outside the Box]

I have to admit the contents of the passive aggressive email you got afterward made me chuckle.

[Travis]

I hung up on the lady after about 20 seconds. She then emailed me to "thank you for the humbling experience of being hung up on. That has never happened to me in the finance industry."

Am I just a huge jerk or what?

-W

Really? You've never been hung up on in the process of selling something? Somebody is either lying or hasn't been doing this for very long.

[Rural]

I hung up on the lady after about 20 seconds. She then emailed me to "thank you for the humbling experience of being hung up on. That has never happened to me in the finance industry."

Am I just a huge jerk or what?

-W

Really? You've never been hung up on in the process of selling something? Somebody is either lying or hasn't been doing this for very long.

How on earth did they get your email address and know to connect it to your phone number?

[prognastat]

I hung up on the lady after about 20 seconds. She then emailed me to "thank you for the humbling experience of being hung up on. That has never happened to me in the finance industry."

Am I just a huge jerk or what?

-W

Really? You've never been hung up on in the process of selling something? Somebody is either lying or hasn't been doing this for very long.

How on earth did they get your email address and know to connect it to your phone number?

I would assume through his account as a personal capital user.

[Outside the Box]

How on earth did they get your email address and know to connect it to your phone number?

They only call you if you have $100k+ of investable assets that they could manage. You have to already be using their free service to monitor your investments. So they already know how much $ you have, your email, and your phone #.

[Heroes821]

They've called me before and I'm not at the 100k+ margin yet, unless they count my house with mortgage...

Regardless the best response to that email should have been "my phone got disconnected I was waiting for a call back can I get your manager's number now" or something snarky

[sirdoug007]

I was entertaining scheduling a call and went so far as to set a date.

Then the woman asked if I would describe my situation as having $100k outside of retirement accounts. Almost all my money is in 401ks so I had to say no.

Then she basically (but politely) hung up on me!  Well quickly ended the call anyways when she knew she couldn't move my money over to their accounts.

I appreciate that they are striving to bring financial planning to the masses but it seems like they could lay out the value of their services better and have people calling THEM rather than the other way around!


Sent from my iPhone using Tapatalk

[Travis]

I let them run their sales pitch on me a year or so ago and the call pretty much ended with "I don't need you to manage my assets, but when I'm ready to retire I might give you a call for tax and estate questions."  Fast forward about 6 months and I'm getting those periodic voice mails again trying to get me to talk to them.

[farmecologist]

I let them run their sales pitch on me a year or so ago and the call pretty much ended with "I don't need you to manage my assets, but when I'm ready to retire I might give you a call for tax and estate questions."  Fast forward about 6 months and I'm getting those periodic voice mails again trying to get me to talk to them.

I love Personal Capital.  I am also getting frequent voicemails...and just ignore them.  However, I do realize that the 'financial planning' side of things is how they produce revenue for the business....and is how they fund the free side of it.  So I'm glad that some people are taking them up on it!  :-)

[Rural]

I hung up on the lady after about 20 seconds. She then emailed me to "thank you for the humbling experience of being hung up on. That has never happened to me in the finance industry."

Am I just a huge jerk or what?

-W

Really? You've never been hung up on in the process of selling something? Somebody is either lying or hasn't been doing this for very long.

How on earth did they get your email address and know to connect it to your phone number?

I would assume through his account as a personal capital user.

Ah, I'd thought he was getting sales pitches trying to get him to sign up with PC rather than getting sales pitches while already a customer. This version is much less creepy, but I'd definitely make it clear on the first sales call that I'd be moving all my money elsewhere if I got a second.

[Indexer]

I hung up on the lady after about 20 seconds. She then emailed me to "thank you for the humbling experience of being hung up on. That has never happened to me in the finance industry."

I work in the investment industry. Thankfully, I'm at the point where I don't have to do that anymore, but I have experience calling potential clients. Yes, I had people hang up on me. If she has never been hung up on it was her first day, and if that is how she reacts I expect her last day isn't far away.

[DarkandStormy]

OP - how did the call go??

[Outside the Box]

OP - how did the call go??

It was apparently an exploratory call to update my info and then prepare the full spiel for the next call. Initially, that was going to be this Friday, but I had to reschedule for 8/25. I'll update after the real call and slide deck presentation.

[WildJager]

I had a cold call from them once.  When I said thanks, but no thanks, I basically got yelled at.  "How do you know you don't want our service if you don't listen to what we have to offer!"  Umm, you're a financial planning service.  I pretty much got the gist if what you're pitching, thanks.

I like their website, though they need to work on their people skills a bit it seems.

[ysette9]

My experience with them has actually been positive on the customer-relation front. They have been low-key and respectful. I just choose not to select their product.

[VoteCthulu]

Back when I used them I got a call from my "personal" advisor wanting to discuss tax strategies. I said no thanks and he seemed upset as he asked why I wasn't interested. When I replied that all of my investments were in tax advantaged accounts he just said "Yeah, that's a good reason" and said goodbye.

Later I wondered why my personal advisor didn't know where my investments were before calling me.

This was 4+ years ago, so things could have changed since then.

[gggggg]

They keep calling and emailing me, I just ignore it to be honest. I don't answer calls from numbers/people I don't know, so they haven't caught me off guard yet. I appreciate their aggregation tool, but I wish I could just pay them a little cash or something instead of being hit up for services.

[Another Reader]

Has anyone noticed they are publishing articles from a life insurance salesman pushing annuities and whole life/universal life insurance?  The articles by their writers state in most cases term life is appropriate, but they give the salesman a platform as well.

Oddly, they don't bother to call here.  Must not be their target demographic...

[farmecologist]

I've heard that your 'net worth' has to reach a certain level before they get serious about calling.  May or may not be true though.

[Outside the Box]

I've heard that your 'net worth' has to reach a certain level before they get serious about calling.  May or may not be true though.

I believe you have to have $100k of non-401k investable assets. Like taxable, cash, IRA, Roth IRA, etc.

[farmecologist]

I've heard that your 'net worth' has to reach a certain level before they get serious about calling.  May or may not be true though.

I believe you have to have $100k of non-401k investable assets. Like taxable, cash, IRA, Roth IRA, etc.

Yep - that sounds correct.   $100K+ of 'investable assets'  ( i.e. - money they can get their hands on ). 

[Outside the Box]

Same thing as last time.

He wanted me to put all my cash into the (his) market. They still index individual stocks doing something called "tactical weighting" to do a total US market strategy where sectors are evenly balanced. He showed examples of how S&P 500 is weighted toward Tech, Finance, Healthcare and underweighted in energy, etc.

Their fee is 0.89% and the claim to provide 2.something% in value by doing tax-loss harvesting, tactical weighting, and tax-efficient holding of stocks/ETFs. The first of those is easier since they hold individual stocks, they don't have to worry as much about wash sales. The last one I do myself by holding REITs/bonds in tax-sheltered accounts and foreign funds in taxable (to get the tax credit for foreignincome tax paid).

However, he wanted to compare everything to S&P 500. I kept saying I didn't know why he was comparing it to that, since that's just large cap, and not VTI. He didn't like that I kept bringing it up.

He basically ended the call in a huff saying they don't work with people who are only focused on price and "he talked to a lady who had an account at UBS with $2M AUM paying 2% and he cut her management fee in more than half" etc.

I maintained I'd be interested to see all his charts/graphs compared over time to VTI + holding things in the correct accounts, and he said if I was a current customer they could have their research team possibly do that, but they're focused etc.

He continued to "neg" me about how I was just focused on price, which is partially true, I guess trying to get me to say "No! I'm super rich and I want to give you all my money!"

Didn't work. He said "Well please continue to use the free product..." etc. Haha.

[Outside the Box]

Anyone else concerned about giving them your info in the first place?  Do they sell your personal info and account balances with marketing partners?

I'm no more worried about them than Mint et al. I haven't received any other financial services calls over the years other than them trying to sell their first-party services.

[Rollin]

My experience with them has actually been positive on the customer-relation front. They have been low-key and respectful. I just choose not to select their product.

I too have had only positive experiences with them. I am FIRE'd and wasn't sure how to start withdrawing $$ (e.g., best tax strategy), rebalancing, transferring from my 457K, and a few other things. They were extremely helpful. I tried talking with VG before I left them about these same subjects and I got about 20% of the answers - just didn't feel confident afterwards. Anytime I have a question PC staff are extremely thorough and helpful (I mainly work with 2 individuals). They spent a ton of time with me when I first started (we did a very thorough analysis of my retirement plan, not just what I wanted to invest). Recently I had a dilemma around tax time and they helped me through it. My CPA is awesome, but he would have charged $350/hour.

If I were still years away from FIRE or still in the accumulation stage I'd still be in Vanguard. However, I am just not comfortable at this point in my retirement to do it by myself. So far I feel their fee has been worth it. I may start slowly shifted some of my $$ back to VG, but this first year of FIRE is critical to me, as I want to set myself up correctly.

So, some of us still need a little handholding.

[Outside the Box]

I may start slowly shifted some of my $$ back to VG, but this first year of FIRE is critical to me, as I want to set myself up correctly.

Wouldn't it be really hard to leave them and rebalance later? At least for taxable accounts. Since they "index" using individual stocks, you would kinda be up a creek doing that on your own vs using mutual funds/ETFs for market sectors.

That is one of the reasons I don't want to go with them: lock in.

[Rollin]

I may start slowly shifted some of my $$ back to VG, but this first year of FIRE is critical to me, as I want to set myself up correctly.

Wouldn't it be really hard to leave them and rebalance later? At least for taxable accounts. Since they "index" using individual stocks, you would kinda be up a creek doing that on your own vs using mutual funds/ETFs for market sectors.

That is one of the reasons I don't want to go with them: lock in.

Yes thought of that, but didn't remember it :). 

[Dicey]

Their fee is 0.89% and the claim to provide 2.something% in value by doing tax-loss harvesting, tactical weighting, and tax-efficient holding of stocks/ETFs.

Quick, somebody! How does this compare to Betterment?

[Travis]

Their fee is 0.89% and the claim to provide 2.something% in value by doing tax-loss harvesting, tactical weighting, and tax-efficient holding of stocks/ETFs.

Quick, somebody! How does this compare to Betterment?

.25% AUM for the first $2 million.

Betterment doesn't promise particular returns, but uses Vanguard index funds.

[Rollin]

I may start slowly shifted some of my $$ back to VG, but this first year of FIRE is critical to me, as I want to set myself up correctly.

Wouldn't it be really hard to leave them and rebalance later? At least for taxable accounts. Since they "index" using individual stocks, you would kinda be up a creek doing that on your own vs using mutual funds/ETFs for market sectors.

That is one of the reasons I don't want to go with them: lock in.

Yes thought of that, but didn't remember it :).

I have about 75% of my portfolio in an IRA with PC, so I could shift that. My issue is knowing how to allocate that similar to what PC has the $$ in. I need to do some more studying on how to compare Vanguard funds with what PC uses.

[Outside the Box]

I have about 75% of my portfolio in an IRA with PC, so I could shift that. My issue is knowing how to allocate that similar to what PC has the $$ in. I need to do some more studying on how to compare Vanguard funds with what PC uses.

You're playing a dangerous game with the possibility of wash sales. Also, you're only going to be able to somewhat approximate at Vanguard if you buy funds relating to exactly the same market sectors as them.

With PC, I think you need to be 100% in or 100% out. At least if your stuff is in an IRA, you can escape them. You can transfer it all in-kind to Vanguard and then buy VTI or whatever with no tax consequences. I would never want a taxable account with PC. I would feel completely trapped.

[Car Jack]

I make it clear that I don't want to be bothered.  I put up with the call when I first open an account (Schwab and TDAmeritrade in the last year) but have never been bothered by Vanguard and met my Fidelity guy at the Fido office when I went in to have a form filled out while transferring my wife's old 403b over.  "Oh, you're the index guy" was his response when I introduced myself.  :D  That's fine....he doesn't bother me anymore on the phone.

If someone sent me an email like that after a cold call hang up, I'd pull all my money out and make sure they knew why.

[Outside the Box]

I make it clear that I don't want to be bothered.  I put up with the call when I first open an account (Schwab and TDAmeritrade in the last year) but have never been bothered by Vanguard and met my Fidelity guy at the Fido office when I went in to have a form filled out while transferring my wife's old 403b over.  "Oh, you're the index guy" was his response when I introduced myself.  :D  That's fine....he doesn't bother me anymore on the phone.

If someone sent me an email like that after a cold call hang up, I'd pull all my money out and make sure they knew why.

You get the calls because they want your money. We don't have money with them to pull out.

It's a free investment analysis tool, like Mint, but on steroids. They pay for the free service with the paying investment customers who pay via a % of AUM. I believe if you tell them "never call me again" they will respect it. I've never gone that far, because I'm interested in hearing how their model is every couple of years.

They only bother me, at most, twice a year. Sometimes only once a year. If I just say "No I'm not feeling like talking about it" they'll ask me when to check back and I'll tell them a year. They put it in the CRM and that's the next time I hear about it. They kept all my objectives/info/etc from the prior times and only asked me if anything changed.

[farmecologist]

I make it clear that I don't want to be bothered.  I put up with the call when I first open an account (Schwab and TDAmeritrade in the last year) but have never been bothered by Vanguard and met my Fidelity guy at the Fido office when I went in to have a form filled out while transferring my wife's old 403b over.  "Oh, you're the index guy" was his response when I introduced myself.  :D  That's fine....he doesn't bother me anymore on the phone.

If someone sent me an email like that after a cold call hang up, I'd pull all my money out and make sure they knew why.

You get the calls because they want your money. We don't have money with them to pull out.

It's a free investment analysis tool, like Mint, but on steroids. They pay for the free service with the paying investment customers who pay via a % of AUM. I believe if you tell them "never call me again" they will respect it. I've never gone that far, because I'm interested in hearing how their model is every couple of years.

They only bother me, at most, twice a year. Sometimes only once a year. If I just say "No I'm not feeling like talking about it" they'll ask me when to check back and I'll tell them a year. They put it in the CRM and that's the next time I hear about it. They kept all my objectives/info/etc from the prior times and only asked me if anything changed.

I don't mind putting up with the calls either ( at this point I just ignore them ).   However, I am grateful that some do use their services so we can continue to use the free investment tools.

[TheAnonOne]

I have done two of their calls, one a few years ago, and another in the last month or so.

The rep they assigned me was reasonably pushy but not rude. We politely debated their "equal weighting" vs VTSAX and then parted ways.

They really hate my offer- "Will you guarantee that we at least MATCH VTSAX's returns, including all fees? If we miss it one year, you can deposit the difference into my account. Otherwise, you can continue to collect your fee."

It usually ends after that.

[Outside the Box]

I have done two of their calls, one a few years ago, and another in the last month or so.

The rep they assigned me was reasonably pushy but not rude. We politely debated their "equal weighting" vs VTSAX and then parted ways.

They really hate my offer- "Will you guarantee that we at least MATCH VTSAX's returns, including all fees? If we miss it one year, you can deposit the difference into my account. Otherwise, you can continue to collect your fee."

It usually ends after that.

That's basically about how my call went if you read my after-action report. Their "tactical weighting" is smoke and mirrors as far as I'm concerned, and it's a great way to lock you in, since even if you transfer out in-kind, you're totally screwed as far as doing asset allocation (unless it's IRA where you can sell/buy without penalty).

[jrgtnre]

I have done two of their calls, one a few years ago, and another in the last month or so.

The rep they assigned me was reasonably pushy but not rude. We politely debated their "equal weighting" vs VTSAX and then parted ways.

They really hate my offer- "Will you guarantee that we at least MATCH VTSAX's returns, including all fees? If we miss it one year, you can deposit the difference into my account. Otherwise, you can continue to collect your fee."

It usually ends after that.

That's basically about how my call went if you read my after-action report. Their "tactical weighting" is smoke and mirrors as far as I'm concerned, and it's a great way to lock you in, since even if you transfer out in-kind, you're totally screwed as far as doing asset allocation (unless it's IRA where you can sell/buy without penalty).

Hi, first time post here, I listened to their presentation yesterday and it left me with some questions... but can you explain why you'd be "totally screwed" for doing asset allocation in that situation?

Other thoughts from the call:

1) He mentioned I was under weighted in international, which I thought might be a fair point.

2) He made the point that the S&P 500 (and even VTSAX) is heavy in Finance and Technology, which have taken hard hits in the last decade and had long roads to recovery. Then transitioned to their much more evenly weighted sector approach. Does anyone think that approach makes sense, and would be worth implementing with the Vanguard ETF's??

3) He also pointed out that these index funds were missing any small cap exposure... again thoughts welcome.

4) Tax loss harvesting: I don't yet understand it or know how much it is worth.

[Outside the Box]

Hi, first time post here, I listened to their presentation yesterday and it left me with some questions... but can you explain why you'd be "totally screwed" for doing asset allocation in that situation?

PC's "tactical weighting" has you invested in individual stocks like Chevron, Apple, Google, etc. If you decide to leave them or even do your own investments outside of their management, you can't just take market sectors like you would if you were using funds/ETFs.

Let's suppose you've been with PC for a while and you have a large amount of assets in a taxable account. If you leave them, and transfer all those in-kind to Vanguard, you now have a bunch of individual company stocks. You can't just sell that and buy an index fund without incurring a large amount of gains (or losses).

1) He mentioned I was under weighted in international, which I thought might be a fair point.

That's up to you how you want to do your asset allocation. I suggest you read about Lazy portfolios.

2) He made the point that the S&P 500 (and even VTSAX) is heavy in Finance and Technology, which have taken hard hits in the last decade and had long roads to recovery. Then transitioned to their much more evenly weighted sector approach. Does anyone think that approach makes sense, and would be worth implementing with the Vanguard ETF's??

3) He also pointed out that these index funds were missing any small cap exposure... again thoughts welcome

This is where I really don't like how they present it, fooling people like you. TheAnonOne and I knew to say "Why are you comparing to S&P 500?" S&P 500 is large cap only. You wouldn't hold S&P 500 only. You would either buy the total market (VTI/VTSAX/VTSMX). This would have exposure to the total market, not just large cap.

Alternatively, if you have limitations like I have in my 401k, I don't have access to total market. But I do have access to Vanguard S&P 500 index funds as well as Vanguard small cap funds. I do my own approximation of the total market. You can read more about doing that on Bogleheads as well. That is what I do.

4) Tax loss harvesting: I don't yet understand it or know how much it is worth.

It can be worth a lot, but by the questions you asked, it seems that you're a very new and/or inexperienced investor. It matters much less than getting your money in the market and getting it on autopilot.

The danger with TLH is wash sales. It's too big to explain here, but you can read more here.

Basically the IRS doesn't let you sell an asset and buy a substantially similar asset to realize a loss. It's really hard to do correctly unless you can see the total picture. That's why I said you need to be 100% in PC or 100% out. If you sell something PC on auto TLH and then buy the thing elsewhere, it can trigger a wash sale. They avoid wash sales with individual stocks, but for reasons above, I really think that's a bad thing long term.

I think that PC's inability to compare themselves with total market and their insistence on comparing only to S&P 500 speaks volumes.

I like the free service, though.

[Outside the Box]

I think it's good to point out "taken hits and long road to recovery" is totally fine in a buy-and-hold strategy. When technology "takes a hit" that means it's on sale. You can rebalance with new funds or existing funds.

The funds/ETFs at Vanguard do this rebalancing automatically for you. If you aren't just buying "total market" you'll have to do your own rebalancing of large/small cap, etc (like I have to do due to 401k), but that's a much easier problem to solve.

[DarkandStormy]

2) He made the point that the S&P 500 (and even VTSAX) is heavy in Finance and Technology, which have taken hard hits in the last decade and had long roads to recovery. Then transitioned to their much more evenly weighted sector approach. Does anyone think that approach makes sense, and would be worth implementing with the Vanguard ETF's??

The entirety of my 401k and HSA is in VTSAX (or well, VTSMX in my HSA as it's the only option).  I am heavily weighted in VGT (Tech Sector ETF) in my Roth IRA and taxable account.  I understand that the tech "bubble" may burst again so I monitor that a bit more.

[jrgtnre]

Thanks for the replies. My confidence in my simple approach is restored. The Lazy Portfolios portfolios link is great, and I will have to study them some more.

[Outside the Box]

Thanks for the replies. My confidence in my simple approach is restored. The Lazy Portfolios portfolios link is great, and I will have to study them some more.

You just mustachianly saved 0.85% compounded over your remaining lifetime, which is huge. Congrats!

[Rollin]

I have about 75% of my portfolio in an IRA with PC, so I could shift that. My issue is knowing how to allocate that similar to what PC has the $$ in. I need to do some more studying on how to compare Vanguard funds with what PC uses.

You're playing a dangerous game with the possibility of wash sales. Also, you're only going to be able to somewhat approximate at Vanguard if you buy funds relating to exactly the same market sectors as them.

With PC, I think you need to be 100% in or 100% out. At least if your stuff is in an IRA, you can escape them. You can transfer it all in-kind to Vanguard and then buy VTI or whatever with no tax consequences. I would never want a taxable account with PC. I would feel completely trapped.

I'm taking out 4% of my total investment with PC, but getting that only from my taxable account (25% of that total). I haven't touched the IRA, except to put in $6,500 for 2017. So, I could move the IRA and still withdraw from the taxable. I have about 75% in the IRA and 25% in the taxable.

[HAPPYINAZ]

I told personal capital once to stop emailing and calling me a long time ago and they stopped.  Just tell them you don't want them call and they likely will stop. 

[redrocker]

I told personal capital once to stop emailing and calling me a long time ago and they stopped.  Just tell them you don't want them call and they likely will stop.

Yep, they have a Do Not Call list (I think legitimate companies are legally required to have one). Just email their support email.

Regardless, I have deleted my account with them. They don't need all my info and Mint + Vanguard's account overview is enough for me. I do wonder how much of this blog's ~$400k/yr haul comes from Personal Capital referrals.