- I recently reached my goal of saving $US100,000 by age 25, and I got there using a strategy I recommend to every client I see as a money coach – visualising your goals.
- I used Personal Capital, a personal finance app, to see where I was spending, what I was saving, and how I could save more towards my goal.
- Personal Capital helped me track my investments, understand my retirement savings, and plot out my savings strategy.
- Open your own Personal Capital account today and get help working towards your financial goals »
As a money coach, one of the top five things I tell my clients to do is create visual goals for their finances.
People who write down their financial goals are 33% more likely to achieve them, according to research. Some people like making games out of their financial goals, while some like keeping a colouring sheet on the wall that tracks their progress.
Others don’t need a gold star each time they put money into their savings, but it’s still helpful to see a complete picture of your overall wealth and financial situation. Personal Capital is the free tool I check daily to keep a close eye on my financial picture.
What I love about Personal Capital
The Personal Capital dashboard makes looking at spending habits easy and intuitive. First, you link all your accounts to the tool (including any investment or retirement accounts). Then, Personal Capital scans that data and looks for patterns in your monthly cash flow.
Now you have the knowledge of how much money you’re bringing in and how much is going out right at your fingertips. After all, you can’t start making financial decisions until you understand your cash flow.
Personal Capital also has financial advisers on call if you need any extra help deciphering what your dashboard means, or if you want some extra help making plans for your future.
The best part is the free initial consult, which lets you decide if going with their professionals is right for you.
A few notable features about Personal Capital that I love and relied on as I saved towards my goal:
Investing for retirement is confusing, complicated, and sometimes so far in the distant future that it’s hard to comprehend. If you’re lucky, your employer offers financial consultations. But for most people, you’re on your own making those decisions.
The retirement planner helps you adjust your goals by offering tools that can help forecast how much money you’ll need to retire and the amount of money you’ll need to save to get there.
Plus, Personal Capital estimates how much you’ll pay in fees over a lifetime so you can be prepared.
Real-time investment updates
Oftentimes, when you login to a retirement/investment account, it will give you delayed value information by a business day or so. You’re in the dark about how your investments are really doing.
Personal Capital gives you real-time updates based upon how the market is performing. So when you see a dip or surge, you get a clear picture of your overall wealth in the moment.
The savings planner
In order to reach financial freedom, you need to have a few different types of savings: retirement, emergency funds, and lowering your overall debt. The Savings Planner tool shows you what you can afford to save, or what you should be saving based upon your goals.
My rule of thumb: work towards building an emergency fund of at least three months of expenses, pay down your high-interest debt, like credit cards, and then add to retirement.
As always, there are a few downsides to every tool that you use:
- At its core, Personal Capital is a net-worth tracker. If you’re someone who isn’t interested in tracking that (you should be!), there are other tools out there.
- If you want day-to-day tracking of your personal expenses, it doesn’t give you that type of breakdown. There are other applications that categorise your spending to help summarize where you could be cutting costs. I recommend Charlie, which gives me alerts if I’m starting to near my monthly budget spending.
Those factors aside, this tool was there for me as I worked towards my savings goal, and I recommend it highly.
Personal Capital makes tracking your wealth easy. Open an account today and take charge of your savings and investments »
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