Intuit Chief Launches Finance Site
Personal Capital site offers lots of tools, plus access to a real human being.
Back in the early days of online investing—say, 1996—amateur traders moved a little “play money” out of their full-service brokerage accounts to bet with. Everyone was a genius in the late 1990s, and do-it-yourself trading became all the rage.
The past decade has been more challenging, and some of these traders have decided to retreat and get more professional help. Many online brokers have added investing advice to their sites, to retain those clients.
While there are lots of resources online for investors who want to go it alone, those who want some personal help usually find a local advisor and establish a face-to-face relationship. In the past few years, however, we’ve seen sites such as Covestor (http://www.covestor.com) and Market Riders (http://www.marketriders.com), which help investors with asset allocation and innovative ways of getting advice and trading ideas ("From MoneyChimps to Bogleheads,” April 25).
Now there’s a new entrant, bringing an interesting twist on personal advice and investing help. Personal Capital (http://www.personalcapital.com), which was launched last week, has a familiar feel, but contains some new features at a reasonable cost. Most of its tools are free; if you choose to hire a personal advisor, you’ll pay a typical fee of less than 1% of your assets under management. It isn’t an online broker—it’s a new-wave investment-advisory service. You start by aggregating your online accounts, and you can use the free tools to see how your portfolio should be balanced. But the real purpose is to gently nudge you toward an investment advisor.
THE MANAGEMENT TEAM at Personal Capital includes CEO Bill Harris, who has been at the helm of two big online successes, Intuit and PayPal. Harris says his new venture is designed to serve the broad middle of the investing market, which he defines as those with $250,000 to $5 million in investable assets. Harris says, “Fundamentally, Personal Capital is a financial-services firm, infused with technology, not just a software platform.”
Harris has pulled together a team of senior executives that he describes as “financial-technology-innovation rock stars.” The team includes Rob Foregger, co-founder of EverBank, along with Jay Shah, formerly chief information officer of E-Loan, plus Jim Del Favero, the former group product manager for Quicken.
When you first visit the Personal Capital site, you tweak your security settings, then start importing financial information. You can import bank, investment, credit, mortgage and other accounts—essentially any financial account that you can access online. Security appears very strong for the entire site.
We took the measure of Personal Capital with a variety of test accounts that we use for our review of online brokers, and found that importing data was pretty easy.
Once the information is imported, Personal Capital’s “dashboard” feature shows you an easy-to-understand breakdown of your spending, your investment allocation, and the gainers and losers in your portfolio. This piece feels familiar if you’ve ever used Quicken, Mint, or even Yodlee. The dashboard cannot (yet) be customized, however.
The picture of your finances that it presents is well-designed. You’ll see your current asset allocation and also a comparison to a target allocation. This takes into account any mutual funds and exchange-traded funds that you hold.
For additional detail, including an estimate of all the fees that you’re paying for the mutual funds and ETFs in your portfolio, click on the “investing” tab. There, you can view your asset allocation, and see where you are over- or under-exposed. The investment-checkup feature encourages moving money out of mutual funds and into individual stocks or ETFs.
The feature that you won’t find on other consolidation sites is labeled “your advisor.” Personal Capital assigns a real human to your account! You can communicate with this person via a toll-free phone number, online chat or video conference. Says Harris: “We want users to engage with our advisors. We’re doing a lot to create a human bond without a physical presence.”
The advisor team is in San Francisco. You can peruse the advisors’ biographies and, if you desire, call the firm to switch to one other than the individual originally assigned to you.
Should you choose to have your investments managed by a Personal Capital advisor, you will transfer funds to an account held at custodian Penson, or a bank account held at Everbank. Your advisor creates what the firm calls a “personal fund,” which is a collection of stocks and ETFs targeted to your needs. Personal Capital tends to avoid mutual funds, owing to their high management fees; you may find that you’re paying less for your investments after an overhaul.
Though the Website needs more customization features, it’s worth a visit to get a good overall picture of your finances. And if you feel that you need more assistance with your investment management, Personal Capital should be on your list of candidates.
BONDS FOR BOOMERS: Recognizing that the huge wave of baby boomers is breaking into retirement, Fidelity Investments (http://www.fidelity.com) has spruced up its fixed-income research center, found under the “research” tab on its Website. The goal is to help customers analyze and develop investing strategies for individual bonds, bond funds and certificates of deposit.
The opening screen of the fixed-income research center now offers a quick search tool, allowing you to scan through five types of bond inventory: Treasury, agency, municipal, investment-grade corporate and high-yield corporate. You can search bond funds and CDs with the same simple interface; a click on advanced search takes you to a much more detailed search engine.
The tweaked search-result screens can be sorted quickly by clicking on any column header, and the new layout is easier to read than its earlier incarnation. One nice touch is the ability to export a search result to a spreadsheet, letting you slice and dice the data to your heart’s content.
The Fidelity funds on the site are highlighted when they appear on a mutual-fund search result, but that’s to be expected. One odd result we’d like to see fixed: A mutual-fund search takes you out of the fixed-income research center, and it takes a few mouse clicks to get back.