I signed into Personal Capital and was greeted by a lecture on risk management This is one reason I like this site, the investment advice is actual investment advice not just back of the napkin. Why pay for your return with too much risk when in the long run the risk can and will eat your lunch and ruin your sleep????
I was going to go into a long over view but I’ll play this instead It gives the overview. Personal Capital is a suite of integrated tools. Its main feature is it’s an account aggregation program. It will log into all of your accounts and create an aggregate snapshot of what you own, what you spend, what you save (or forgot to save), and it will help you spiff up your returns and help you to set your AA to place you smack dab on the Efficient Frontier at your chosen level of risk. It will optimize in a way that projects your mistake into the future and shows you the difference between “your way” and the optimized way. The optimized way wins.
It freaked me out at first allowing all of my accounts to be scanned by the aggragator but the payoff is worth it and nothing has been hacked. I really like the way it aids in portfolio planning. It uses the same kind of tools to do the analysis that I have been describing Efficient Frontier and Monte Carlo analysis. It optimizes taxes to some extent and has a hierarchy of account payout strategy It’s not perfect but very good and these strategies are what I’ve read about in professional investment journal articles . So the advice is professional and up to date in portfolio theory.
It tracks accumulation and reads out probability of success and allows testing of different scenarios. I still do things my way but I always check my results against the PC software. I use a proprietary aggregator which is more granular and can help me answer specific questions but for a free program PC is hard to beat and wholly adequate for anyone but a money Nerd like me. Employing an aggregator was the single most powerful investment decision I ever made. Between me and my wife at one point we had 14 accounts with 14 asset mixes based on assets available to the account and before the aggragator it was impossible to correctly track reality. This one does it automatically and has the prognostication and optimization tools built in and they are reliable. If you have the real probabilities laid out before you it’s easy to judge the risk and choose correctly. If you veer off course PC will help you correct soonest. Because the program is not emotional it helps relieve fear and fantasy and the epic tales of great Ulysses or Buffet from the mix. The only way to know is to sign up and create your portfolio. Here is the web site I am not affiliated in any way, just a fan! They make their money by selling advice. They will to to sell you advice but like Nancy Reagan said “just say no”. I don’t know anything about their investment advice service except it seems a little expensive. I did look up some reviews and they do help with tax planning and a good tax plan like tax loss harvesting can save you a lot more than management fees but again this is not a recommendation for or against the professional services.