How I Manage 28 Financial Accounts In A Single App
I received an email last month from a follower of my YouTube channel. Tired of juggling multiple accounts, she wanted a single app that could monitor everything from bank accounts to credit cards to her 401(k). She had reached out to a financial advisor who offered to help her—for $3,000!
She asked me if $3,000 was a reasonable fee.
Deep breath.
No, it’s not reasonable for a financial advisor to charge $3,000 to do what can be done for free in less than 30 minutes. To help her, I created a video walking through exactly how I manage 28 financial accounts in my favorite free financial app—Personal Capital.
Account Aggregation Software
While Personal Capital is my favorite financial tool, it’s not the only alternative. There are a number of apps, software and tools that can help monitor a person’s financial life. They all have one thing in common. They link to your financial accounts and automatically download account data.
This is both a blessing and a potential cause for concern. It’s a blessing because it makes tracking every aspect of one’s financial life a breeze. Personal Capital keeps track of everything from the $4 latte you bought last Thursday to the reinvested dividend a mutual fund paid out in your IRA.
It can be a cause for concern, however, when it comes to security. In the case of Personal Capital, it uses bank-level security features. For example, not even Personal Capital has the login credentials to the accounts users link to its financial dashboard. Those are managed by a company called Yodlee, a data aggregation company used by many of the largest U.S. banks. Still, it’s a psychology hurdle one needs to clear before taking advantage of an account aggregation app.
If you clear that hurdle, there are many benefits to a seeing all your data in one place.
Financial Data in One Place
The first thing that Personal Capital does is bring all of date from linked accounts into one place. Rather than logging into 28 separate accounts to check balances and transactions, I can log into just Personal Capital. Here’s what its dashboard looks like using sample data:
Along the left sidebar are all the linked accounts, their balances, and the last time they were updated. Beyond just the numbers, however, Personal Capital also analyzes the data and presents it in a number of ways. This can be seen in the middle of the Dashboard, where users will find snapshots of their net worth, budget, cash flow, portfolio, retirement planner and emergency savings.
Financial Analysis
The financial dashboard is just the beginning. For each of the different ways Personal Capital analyzes a user’s financial accounts, they can drill down into the details.
Cash Flow
The cash flow screens allow users to view details of their income and expenses across all accounts. They can select the time period, and they can also select which accounts to view. I use the income view across just my investment accounts to see how much interest and dividend income has been generated each month.
Budgeting
Personal Capital also has a budget tracking feature. It starts with a predefined set of categories that it automatically applies to incoming transactions. These categories can be changed, and users can create new categories. This information is then displayed in a graph and chart (see image above) to make it easy to track spending by category throughout the month.
Bill Tracking
For each loan linked to Personal Capital, you can receive notices when the monthly payment is due. This is helpful to avoid missing a payment. We use it to track when each of our cash back and travel reward credit cards are due.
Net Worth Tracker
Net worth is the single most important metric when measuring financial progress. It reflects, for better or worse,…
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