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Personal Capital pitch
Old 06-15-2014, 08:09 PM   #1
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Personal Capital pitch

A year or more ago I tried out Personal Capital - put in a few accounts and passwords and they aggregate your holdings and show you what you have and have earned or lost. Very easy, one site and password to remember and all the data is right there. One of the founders was a big cheese with Quicken and Paypal and they make a big deal of how secure your data is. We didn't divulge all our accounts to Personal Capital, but I will say there has been no hint of any data leakage or compromise (unlike going shopping at Target for instance). Up till a few weeks ago we had one low key call from PC.

Couple weeks ago we got a call and I filled the caller in on our assets and their composition. He got all enthused and we got another call last week. I listened to the pitch and got the fee schedule and said we were pretty certain not to be customers, but he wants to call back Wednesday. I don't want to do my standard knee jerk "NO!", so I'm looking for input. We do ok with other than stock market holdings and I've done some stunningly dumb things (given hindsight), like selling our stock holdings on 8/31 2012 and sitting out that icky old 2013 30% market surge. Still, this year, now that prices are higher, we've been buying back in at a couple thousand each week, 1/2 Vanguard VTSAX and 1/2 VIMSX.

Personal Capital says this for fees:
"Our fees are low, transparent, and aligned with our clients’ best interest. One simple fee includes investment advice, portfolio management, custody and trading. The schedule is as follows:
  • First $250,000:0.95%
  • Next $250,000:0.90%
  • Next $500,000:0.85%
  • Next $4,000,000:0.80%
  • Remaining:0.75%
Your assets are held at a world-class third party custodian. We pay them a fee based on assets instead of per trade. The result is you never pay a dime for trade commissions. This lowers your costs and allows us to make all trade decisions objectively, based on what is best for your portfolio.
This arrangement makes Tactical Weighting and Tax Optimization possible. We are excited to offer the type of service previously only available to institutions and ultra-high net worth individuals".



I'm dubious that Personal Capital can overcome a 0.65 to 0.75% fee bump over Vanguard's fees. OTOH, about all I plan to do is camp out on that 50/50 pair of US stock funds, so no re-balancing or sector weighting or nuttin. What do you think? PC or plodding purchases?
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Old 06-15-2014, 09:01 PM   #2
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Too expensive. Try FPL, or Cardiff Park, or Evanson Or even Portfolio Solutions for much more reasonable rates.
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Old 06-15-2014, 09:25 PM   #3
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Originally Posted by calmloki View Post
I'm dubious that Personal Capital can overcome a 0.65 to 0.75% fee bump over Vanguard's fees. OTOH, about all I plan to do is camp out on that 50/50 pair of US stock funds, so no re-balancing or sector weighting or nuttin. What do you think? PC or plodding purchases?
I vote for plodding purchases and no fees. They (PC) have no magic bullets or secret funds.
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Old 06-15-2014, 09:26 PM   #4
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I like and use the Personal Capital dashboard to look at my holdings. It is a nicely designed overview of my financial situation and includes analysis of TSP funds in the asset allocation information. I went through a presentation from their rep, explained that I would not be a candidate to use their portfolio management services and have not been bothered since (about 15 months). I get an occasional info email, but that's all.

While their overall approach was not at great variance with my views, their strategy of using a bucket of individual positions vice index funds in the equity portion of the portfolio did not appeal to me.

My opinion...as they say, everybody has one...First decide if you want to DYI or have another person/firm manage your investments. My view is that you should not entertain another pitch from PC, or any investment management firm for that matter, until you've made that first choice. If you want investment management help, there are plenty of firms that are worthy of your research and consideration, not just PC.

Good fortune on your efforts...
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Old 06-15-2014, 10:01 PM   #5
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I think there was a meeting in some conference room at Personal Capital where folks were told "We need to make some money now and capture some assets under management before everyone figures out that new assets managing deal at Vanguard."

If you want to have some fun, get the caller to switch their portfolio to Vanguard and then quit their job at Personal Capital. I would suggest phrases such as "I'd have to be an idiot to pay more than 0.3% since that's what the better competition is charging." Or perhaps, "Aren't you worried about losing your job since the competition is eating your lunch?"
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Old 06-16-2014, 11:17 AM   #6
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I previously used the Personal Capital website until its login troubles started forcing password resets at one of my financial institutions. That, and its inability to access an account that held about half of my assets meant I just couldn't rely on it.

I recall that it had a page that told me the ER's of all my investment accounts, and how much it was costing me per year and maybe even projected into the future. If they still have that page, I wonder if they show the comparable view of using PC's managed investments?
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Old 06-16-2014, 11:42 AM   #7
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I use Personal Capital, but I have simply never returned any of my rep's calls because I'm not convinced their advisory services are worth the fee. I vote for avoiding the hard sell; if I were you, I'd email the rep and tell him that you are not presently interested, but thanks anyway. Their fees are essentially the same as any other financial adviser. They are unlikely to dump you from their platform if you don't use their services.
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Old 06-16-2014, 11:52 AM   #8
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If you are planning a 50/50 asset allocation and are using Vangard funds, Personal Capital cannot compete. Unless, of course, they are willing to negotiate a fee.

If you feel there is a need to have your money managed, as others have said, there are equally skilled money managers who will charge far less than they are offering.

Even at 0.20% on the entire portfolio amount, you need to add Vangard funds expense ratio to that amount. Anything more than a combined 0.50% is too much, in my opinion, for an auto-pilot asset allocation.

-- Rita

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Old 06-16-2014, 12:23 PM   #9
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Do what I do. Get the free steak dinner and then say NO!
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Old 06-16-2014, 01:28 PM   #10
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Quote:
Originally Posted by Mo Money View Post
I use Personal Capital, but I have simply never returned any of my rep's calls because I'm not convinced their advisory services are worth the fee. I vote for avoiding the hard sell; if I were you, I'd email the rep and tell him that you are not presently interested, but thanks anyway. Their fees are essentially the same as any other financial adviser. They are unlikely to dump you from their platform if you don't use their services.
Email was a good suggestion - neither the PC rep nor I need to waste time. Sent him this:

"I read through the presentation page by page last night and have looked at the 2012-current performance and fee pages. At this point we will not be hiring Personal Capital as an adviser.

S*** has no interest in moving her IRA or Roth accounts and we only plan on adding about $50k maximum to our stock accounts this year. Given the extra layer and cost of adviser and added tax complexity & tax prep expense vs. buy and hold of only a couple Vanguard index funds (which we can do for 0.20%) we are going to opt for simplicity.

I wanted to save you the phone call on Wednesday - looks like I'll be doing a dump run from one of the rentals instead!

Thanks for the detailed exposition though,"

The PC rep was professional and sent this:

"Thank you for getting back to me with you decision. I will plan to follow up with you next year to see if it makes sense at that point. If you need anything in the interim feel free to give me a call at any point."

Good deal - I really didn't need the stress of saying "no" repeatedly. Thanks.
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Old 06-16-2014, 02:11 PM   #11
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If you have very little investing knowledge or desire to learn: Portfolio Solutions.

Otherwise: bogleheads.org
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Old 06-16-2014, 04:23 PM   #12
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Quote:
Originally Posted by Mo Money View Post
I use Personal Capital, but I have simply never returned any of my rep's calls because I'm not convinced their advisory services are worth the fee. I vote for avoiding the hard sell; if I were you, I'd email the rep and tell him that you are not presently interested, but thanks anyway. Their fees are essentially the same as any other financial adviser. They are unlikely to dump you from their platform if you don't use their services.
This +1. I wrote "my guy" when he started calling a while ago and just said "Thanks for checking up, I understand that's what you have to do. I'm quite comfortable with my financial situation and prefer to manage it on my own. You guys have a great website/dashboard, and I pass it on to friends and provide good advertising on some financial forums I frequent as well!"

Haven't heard a peep since.
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Old 06-16-2014, 10:14 PM   #13
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If you have very little investing knowledge or desire to learn: Portfolio Solutions.

Otherwise: bogleheads.org
Completely agree
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Old 06-17-2014, 12:52 AM   #14
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I got a call from PC also (actually a couple of calls) - I told him I was not interested in using their service (I think he said they charged 1% or something but I am not 100% sure), but he was like why not have a couple of free consultations anyway? "Our consultant <plug in a name> can review your assets for free." I was like so what kind of credentials does this person have? Is he a CFP? And he explained to me he has Series <plug in some numbers> certificate or something or other. I told him I was going to call him back (I didn't and he called me back). I told him I would write to him with some open dates. I don't think I will write back though...
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Old 06-17-2014, 08:03 AM   #15
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Might be end of quarter activity - I received my occasional call from a Personal Capital rep yesterday.
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Old 06-17-2014, 12:07 PM   #16
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I never heard of these people. Also I never get invitations to prospecting dinners or anything. Maybe these guys do not work inner city residents much.

At any rate, I wouldn't do any of it. unless maybe a baseball game or other sort of outing which my discount broker occasionally comes up with.

I might be too downscale.

Ha
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