Empower (Formerly Personal Capital) Review: Powerful Retirement Planning and Investment Tools

Empower, formerly known as Personal Capital, offers several useful free tools to help you improve your finances. You can use it as a budgeting app by connecting all your accounts, and it can assist with your investments and retirement planning. If you have at least $100,000 in investment assets, there are also wealth management services available. Read our full Empower review to see everything it has to offer.

What is Empower and how does it work?

Empower is a financial planning, money management, and investing app in one. Like many popular budgeting apps, it allows you to connect your accounts to the app's dashboard to monitor everything in one place. You can connect bank accounts, credit cards, retirement accounts, investments, and any other financial account you have. Empower also has tools to help accelerate wealth building. These include:

• A retirement planner to assess your retirement goals and your chances of success based on your portfolio.
• An investment checkup tool to see how your investments are performing and suggest possible improvements.
• A net worth calculator to track yours and see if it's headed in the right direction.

During the Empower registration process, you're required to schedule a call with one of its financial advisors for a free consultation. There's no commitment required, but Empower also offers wealth management services to those with at least $100,000 in investment assets. It offers three levels of management depending on your investment assets:

• Investment services ($100,000 to $250,000): Unlimited advice and retirement planning from financial advisors and a professionally managed ETF portfolio.
• Wealth management ($250,000 to $1 million): Two dedicated financial advisors and a customized portfolio.
• Private client (over $ 1 million): Two dedicated financial advisors with priority access to Empower's specialists and Investment Committee.

Top perks

Retirement and investment planning

The retirement and investment planning tools that Empower offers are excellent, especially considering they're available free of charge. In its retirement planner, you can set up different scenarios, plug in big expenses to see how they'll affect your retirement plan, and check how much income you'll have per month. It even lets you simulate the impact of a recession. Its investment tools evaluate your portfolio, provide an asset allocation strategy for your goals, and uncover hidden fees.

While Empower works very well as a budgeting app, retirement and investment planning are where it shines. It will show you whether you're on track to retire when you want and recommend ways you can grow your money more efficiently.

SEE MORE: Best Budgeting Apps

Monitor all your financial accounts

You can connect practically any type of account to this financial tool. On the Empower dashboard, you'll be able to conveniently view your linked accounts. From there, you can explore your monthly earnings and expenses, create a budget, set up savings goals, and much more.

When you have all your accounts in one place, it's much simpler to get a clear picture of your personal finances. Instead of logging in to separate sites to view your brokerage accounts, bank accounts, and credit card bills, you just open the Empower app. Several budgeting apps offer this, but Personal Capital stands out because of its easy-to-use design.

Free app

Personal Capital doesn't charge a fee for its app and all the features it offers. If you decide to use its wealth management services, there is a fee for that. But everything else is available for free.

Offers wealth management services

Clients who have at least $100,000 in investment assets can sign up for a wealth management plan with Empower. There are multiple plans available depending on your investment assets. Features include a financial advisory team or your own dedicated financial advisors, tax optimization, and portfolio monitoring and rebalancing. Fees start at 0.89% for the first $1 million in investment assets and decrease for private clients with over $1 million.

Keep in mind that if you have $100,000 or more in investment assets connected to your account, Empower may contact you about its wealth management services. If you're not interested, you can opt out of future contact.

What could be improved

No credit monitoring

Empower doesn't offer credit monitoring. This type of service is helpful to stay on top of your credit score and any activity on your credit file. It's also a feature available with several other budgeting apps. Even though there are plenty of free ways to get your credit score, it'd be great for Empower to include this so you don't need to look elsewhere.

RELATED: How to Find Out Your Credit Score

Wealth management fees

Empower's annual management fee starts at 0.89% for up to $1 million. That's on the high side. Similar services are available for fees of under 0.50%. For example, Vanguard Personal Advisor® charges 0.40% for a mix of index funds and active management. Betterment Premium also charges an annual fee of 0.40%. Many top robo-advisors charge even less.

Over time, investment fees can significantly cut into your portfolio's returns. That's especially true with a 0.89% fee. Before you consider wealth management with Empower, make sure to compare all your options.

$100,000 minimum for wealth management

The minimum $100,000 for Empower's wealth management services is also somewhat high. If you are interested in using it, you'll need a solid amount saved up already. There are other options with lower minimums available.

The Empower app doesn't charge a fee. You can connect your accounts to use its budgeting services and other tools free of charge. The only fee involved with Empower is for its optional wealth management services.

Empower charges an all-inclusive annual management fee for wealth management services. It uses a tiered fee structure where the fee amount depends on your assets under management. Fees start at 0.89% for the first $1 million, which includes primary and premium clients. Those with over $1 million in investment assets are private clients and qualify for lower fees.

Here are the rates based on investment assets for primary, premium, and private clients.

Primary and premium clients

• First $1 million: 0.89%

Private clients

• First $3 million: 0.79%
• Next $2 million: 0.69%
• Next $5 million: 0.59%
• Over $10 million: 0.49%

Consumers who want to optimize their retirement planning and investment portfolios. The retirement planner, budget planner, and investment check up tools are some of the best you'll find. These features are extremely useful for building wealth as efficiently as possible.

Empower's wealth management services may not be the right fit for most due to the fees involved. But the free tools available on the Empower Personal Dashboard can certainly help with better managing your money and investments.