Author Topic: Has anyone used Personal Captitals management services?  (Read 1628 times)

Jules13

  • Stubble
  • **
  • Posts: 243
    • January Girl
Has anyone used Personal Captitals management services?
« on: February 08, 2017, 12:10:39 PM »
I tried to search on this topic, but my search doesn't appear to be working as I'm sure someone has discussed this.  If so, please direct me to the correct thread if possible, thanks.

I have signed up for them and talked with them and even thought I'm a pretty good saver, I'm not very knowledgeable on funds or how to pick them or how to allocate sectors, etc.  They made their services sound pretty good (automatic re-balancing and all that).  I'm a pretty hands off investor (simply because I don't really know enough) and the .89% management fee, although reportedly high, is not much higher than the .72% I'm evidently currently paying in fund fees on the ones they would be managing.  Plus, they'd give me advice on our 401k as well, even though not managing it directly. 

It sounds like it might be good for us, but I wanted to check with others and what they thought....if anyone has had any first hand experience?

Thanks!

inline five

  • Pencil Stache
  • ****
  • Posts: 675
Re: Has anyone used Personal Captitals management services?
« Reply #1 on: February 08, 2017, 12:26:45 PM »
One thing I thought to do was sign up using a small account balance. They would allocate based on that and fees would be based on that. Example $1000 balance is $9 in fees. Based on their allocation for that account expand it to include all of yours. Would save considerable amounts in fees.

ysette9

  • Walrus Stache
  • *******
  • Posts: 8930
  • Age: 2020
  • Location: Bay Area at heart living in the PNW
Re: Has anyone used Personal Captitals management services?
« Reply #2 on: February 08, 2017, 12:30:08 PM »
Try using google search outside this website to search the forums. That will bring up the multiple times this topic has been addressed. The consensus has always been that it is not a good idea, and the service is not worth the fees they charge.

Spend time educating yourself and lean on the smart people ok this forum to help you decide on an investing strategy that fits your goals and risk tolerance. You future self will thank you for taking charge.

I recommend JLcollin's stock series and the boglehead wiki Investment Startup Kit. I'm on a phone so I can't easily insert the links, but just google them and you'll find a great place to start your education.

NorthernBlitz

  • Bristles
  • ***
  • Posts: 493
Re: Has anyone used Personal Captitals management services?
« Reply #3 on: February 08, 2017, 01:29:46 PM »
I haven't used Personal Capital's management service. But at ~0.9%, I think that you shouldn't either.

What we've done is (a) read JL Collins Stock Series, (b) added our into into a tool like Personal Capital and (c) re balanced every year. Buy your funds from a place like Vanguard and you're cutting that fee by 90%. You'll accumulate funds faster with the lower expense ratio, and the lower fees will give you a higher safe withdrawal rate after you retire.

From what I've heard, wanting to be hands off is the best thing possible for Index Investors. Tinkering with investments usually leads to bad behavioral decisions. Doing it yourself requires (a) automatic contributions (one time effort to set up) and (b) re-balancing once / year (<30 minutes a year). I suppose that it also requires sticking with the program and not pulling out money when the market drops...I've heard the argument that paying for advice means that you're less likely to make poor emotionally decisions (i.e. behavioral finance).

I think that the free investment portfolio tool at Personal Capital gives you a target allocation. You can probably hit that allocation (or something very close to it) buy buying three funds:
- Total US Stock Market Index (i.e. Vanguard's VTSAX) MER 0.05%
- Total International Stock Market Index (i.e. Vanguard's VTIAX) MER 0.12%
- Total US Bond Market Index (i.e. VBTLX) MER 0.06%

I've listed the names / MERs for admiral shares above. These are the versions of the funds you get after you surpass a certain minimum investment requirement (typically $10,000). If you're not at that level yet, it's probably best to do something like what JL Collins suggests and just plug it all into VTSAX. For me, I put all my contributions for my Roth IRA into VTSAX, then I get the Institutional versions of the other funds through my 403b (we're lucky that they have good fund selection in our workplace plan) and re-ballance every year.

I'm not sure about Personal Capital, but I think that you'd be paying their fee + whatever MER is related to the funds you have.

Of course, take all of this with a grain of salt. I'm still pretty early on in my own adventure. But, it seems like it's a reasonable plan to me.

Fomerly known as something

  • Handlebar Stache
  • *****
  • Posts: 1627
  • Location: CA
Re: Has anyone used Personal Captitals management services?
« Reply #4 on: February 08, 2017, 05:40:40 PM »
If you want some guidance from a professional look for a fee only planner that charges a set amount vs a percentage.  They can be engaged in either a limited role set up a plan (one time fee) or on-giong planning with a monthly fee.  There are a couple of networks of these professionals out there.  The one I know is XY network. 

Disclaimer:  I only know about XY because a friend of mine is part of it.  He directs his clients to funds that are popular here, I don't currently use him because I have a good handle of what I want to be doing with my investments.  However, if I do FIRE earlier than I currently plan I will likely at a minimum pay him to help me during the transition/make sure the numbers add up and are not me hoping.