Our Take

Formerly known as Personal Capital, Empower offers financial planning, retirement management, and investment-related services. Nܫot officially a robo-advisor, Empower considers itself an automated investment manager with a strong human element, similar to aꦫ traditional financial advisory firm. 

Emp🍸ower users have free access to a wide array of🍌 free investment management analytical tools.

There are also three premium tiers. Those with at least $100,000 in investable assets on deposit can sign up for fee-based investment advisory services. A broader wealth management service is available for those who deposit $250,000 in investable assets. A private client tier serves people with $1 million or more in their accounts.

Pros & Cons

Account Overview

Account Setup

Sign up and create an Empower account by providing an email, password, phone number, birth date, and basic financial information. To use the free investment management tools and the paid advisory service, ಌyou’re required to𒁃 schedule a brief, no-obligation phone call with a financial advisor. This is a small price to pay for the use of the robust suite of financial tools. 

Next, link your financial accounts, or input them manually. This enables you to use the free financial management cಌalcula🥃tors and tools. 

The next step allows you to link your accounts. This process is fast and secure and you can add most ಞfinaꩵncial accounts, including:

• Bank
• Investment
• Debt
• Credit card
• Manually entered categories
• Home mortgage information

After syncing your financial accounts or manually inputting your data, you can access the free financial tools and reports. These budgeting, saving, spending, and retirement planning reports are available to all users, not just premium-tier subscribers.

Users with $100,🌱000 or more to invest can opt for a free investment analysis or sign up for the premium tier by answe🌠ring a few questions that cover financial situation, goals, and risk comfort level. You’ll receive a personalized financial plan.

To sign up for Empower Investment Services, you’ll need to open an account at the fund’s custodian and transfer your assets. Along wit♛h your advisor, you can explore the available customization options to craft a suitable investment mix for you. 

Users with $100,000 in asse𒀰ts to invest can start with Empower Investment Services, which includes access to a team of advisors. People with more than $250,000 to invest are eligible for Empower Wealth Management and two dedicated advisors in addition to more customization options෴.

Accounts over $1 million qualify as Private Clients and open up access to the investment committee, more direct support, and private equity options (requires $5 million).

Goal Planning

The features in the customized Empower goal-planning offering rivals those available from 澳洲幸运5官方开奖结果体彩网:Betterment. Wealth Management goal-setting for clients is customized and starts with a conversation with your licens🌜ed financial advisor. Although retirement is a popular goal, clients can invest for any goal such as saving for college tuition or a vacation home. 

The free tools test in-depth retirement planning scenarios. The retirement simulator projects your income and spending during both the accumulation and distribution phases of life to reveal best- and wo♉rst-case expectations for meeting your long-term retirement needs. 

Empower Wealth Management clients benefit from ongoing monitoring of goals with their financial advisor𒉰 with the opportunity for revisions along the way as your life evolves.

Account Services

Empower’s Services fit into three categories: Free 🌱financial planning and analysis, fee-based wealth m🔯anagement services, and private client services.

Free Financial Planning and Analysis

Anyone can sync their financial accounts and access Empower's financial planning software. The calculators and tools encompass:

• Retirement planner
• Budgeting planner
• Education Planner
• Investment checkup
• Net worth tracking

The investment checkup analyzes your asset allocation and suggests ways to increase returns and lower risks. It a൲lso looks at your investment fees and suggests replacing high-fee funds.

The retirement planner allows you to adjust inputs and investigate the success of various retirement scenarios. It delves into scenario analysis and customize💯d guidance.

We found the calculators and tools 🎶extremely helpful. Thanks to account syncing, they provided individualized and actionable insights.

Fee-Based Wealth Management Services

Empower financial management services are spearheaded by the financial advisor and offer typical investment and money management services. The services vary, depending upon your asset level. 

Cash Management

The Empower Personal Cash account is managed through UMB bank and doesn’t require a minimum balance.

The yield on deposits is comparable to ❀the highest available online. It currently offers 4.20% APY. The FDIC insurance is capped at $5 million and is provided by partner ba𒁃nks. 

Features of this account include:

• Paycheck direct deposit
• Unlimited monthly transfers via ACH transfer
• Withdraw up to $100,000 per day
• No required minimum
• Individual and joint accounts
• Link to your checking account for bill pay
  

Portfolio Construction

Empower personalizes the portfolio construction process and uses your aggregated financial accounts and your personal goals and risk tolerance level to select an investment strategy. Unlike many competitors, the Empower portfolios use a “smart weighting” approach which equal-weights equity sector exposure as opposed to a market capitalization asset class weighting. The typical market-cap weighting replicates portfolio sectors by number of shares multiplied by share value and tends to overweight the largest companies and sectors. The firm’s smart weighting equally weights assets based on size, sector, and style. This portfolio construction strives to provide a higher risk-adjusted return than the 澳洲幸运5官方开奖结果体彩网:market cap-weighted allocation.

When constructing 🔥p🧸ortfolios, the Empower computerized algorithm considers:

• Time horizon, goals, and liquidity needs
• Current net worth and income
• Age
• Desired lifestyle, personal beliefs, and dependents
• Expenses including mortgage and educational expenses
• Marginal tax rate and tax laws
• Risk tolerance
• Legacy goals
• Future pensions and Social Security

The data synced to Empower and discussed during the call with the financial advisor gives Empower more to work with than most digital investment advisors have. This data provides a distinct diversification model that 💮ends up being more comprehensive than many other algorithm-based platforms. The asset allocation employed in the Empower strategy includes varying allotments to the following asset classes:

• ETFs for both stocks and bonds in varying styles, sizes, and sectors
• U.S. stocks, including varying styles, sizes, and sectors
• International stocks, including developed and emerging markets
• U.S. bonds, including diverse government and corporate bonds of varying credit quality
• International bonds of varying credit quality
• Alternatives, including real estate and commodities
• Cash

Empower does not offer exposure to 澳洲幸运5官方开奖结果体彩网:cyptocurrency.

Available Assets

Portfolio Customization

Cust🐎omization is an area in which Empower excels. Driven by the client and financial advisor, customization accommodates your tax situation and unique preferences.

Clients can request distinct asset allocations, a socially responsible option, additional individual stocks to supplement ETFs, exclusions of individual stocks, restricted buy or sell lists, replacement ETFs or stocks, special tax-influenced strategies, and moꩵre.

Wealthier clients can access direct equity investments and 澳洲幸运5官方开奖结果体彩网:private equity as well. 

Portfolio Management

Nearly all robo-advisory portfolio strategies are driven by the seminal research of 澳洲幸运5官方开奖结果体彩网:Harry Markowitz, who created an 澳洲幸运5官方开奖结果体彩网:efficient frontier graph. Back in its Personal Capital days, Markowitz was an advisor to the board and no doubt influenced the company's commitme🎐nt to true diversification.

Individual portfolios are selected based on the client’s risk-tolerance levels. The appropriate balance of stock and bond investments is chosen to deliver the highest return for an investor's given risk level. 

When portfolios deviate from the predetermined stock vs. bond 🐠mix, they are rebalanced back to their original percentages. This is usually done✃ by selling a proportion of the overperforming assets and buying more of the underperformers. 

Taxable accounts at Empower are eligible for 澳洲幸运5官方开奖结果体彩网:tax-loss harvesting, which is a process of selling losing positions and offsetting rea🍨lized taxable gains with the losses. This minimi𓂃zes tax liabilities, thereby increasing aggregate investment gains.

Municipal bond funds are also included to provide t🧸ax-exempt cash flow. 

User Experience

Desktop

The Empower use🐓r experience is among the best of the robo-advisory group. Every important sect✱ion of the website can be accessed within one click from a home page menu item.

The menu items and categories make navigation a breeze꧅. F🅠rom the home page, you can quickly go to the following areas.

• Overview: Dashboard, net worth, transactions
• Banking: Cash flow, budgeting, bills
• Investing: Holdings, balances, performance, allocation, U.S. sectors
• Planning: Retirement planner, savings planner, retirement fee analyzer, investment checkup 
• Wealth Management: Advisor and currency educational portal
  

Mobile

♓The mobile app includes the Em🍎power automated investment manager and the free financial advice tools. This Empower review excludes the other Empower verticals such as 401k management. 

The mobile app isܫ available for iOܫS and Android and offers account management, Empower Personal Cash, and many portfolio analysis tools. It’s also accessible on a wearable device. As with the desktop version, users can track cash flow and investments and use the retirement planning features.

T💞he app also provides personalized insights such as how much you’ve saved this year.

A few desktop features are lacking on the app. In addition, there are some issues with account sync and a lack of accur🍸ate current data reporting, particularly on the Android app.

Customer Service

• Phone
• Email
• Telephone and virtual meetings with advisors
• Comprehensive FAQs

Customer service is above average at Empower. Users can contact the🔯 company by phone and via email.

Advisory clients can email an♎d phone their investment representa🎐tives to schedule virtual or telephone meetings.

The FAQs are comprehensive and well-categorized. Chat is not available, although there is a chatbot for clients. Empower Personal Cash directs users to contact the company via email. 

Security

The platform employs the highest security protocols. Multiple layers of security protect users' accounts, money, and information. The encrypted client login is not available to company employees.

The unique Empower Security Guarantee states that the company will “restore losses to your account that occur as a result of unauthorized transactions through no fault of your own.”

Security protocols include:

• Two-factor authentication
• Firewalls and perimeter security comparable with banks and payment cards
• 256-bit AES data encryption
• Empower doesn’t sell your data.
• Empower carries Securities Investor Protection Corporation (SIPC) insurance up to $500,000, which includes $250,000 for cash deposits. As is universal in the industry, there is no coverage for market losses.
• Cash accounts carry FDIC insurance through partner banks, with up to $5 million for losses due to bankruptcy or malfeasance.

Education

The Empower educational content is weak. It appears as though all of the articles from 🌠the prior Personal Capital blog have been removed.

The Press Center continues to publish announcements and some economic analysis and the Currency has more gener﷽al fina🔯ncial content that includes original research.

Tꦗhe Empower YouTube channel is a hodgepodge of 96 videos including testimonials and commercials but little educational content. Empower users will need to look elsewhere for investment education content. 

Commissions and Fees

Empower’s money management software is available for free and is well worth checking out. Empower charges fees based on assets under management. There are no commissions or transaction fees. This fee covers advice on all of a client's assets, not only those managed through Empower. 

Empower's cost is higher than most competitors with financial advisors, such as Betterment, Schwab Intelligent Portfolios Premium, and Vanguard Personal Advisors.

Empoꦿwer considers itself more of a replacement for a traditional financial advisor and less of a typical robo-ad🌺visor.

Can Empower Save Me Money on Taxes?

If you open a taxable account with Empower, you'll get tax-efficient investing as well as tax-loss harvesting guidance.

The service prioritizes debt investments that are tax-advantaged, like 澳洲幸运5官方开奖结果体彩网:municipal bonds.

For tax-loss harvesting, the service looks for portions of the portfolio where an investment with a loss can be swapped out to realize the loss without changing the overall portfolio. These losses are realized to offset gains in other parts of the portfolio while also respecting 澳洲幸运5官方开奖结果体彩网:wash sale rules.

Is Empower Legit?

Empower is a legitimate 澳洲幸运5官方开奖结果体彩网:financial advisory firm. The fee-free cash account and financial analysis tools are also the real deal. Anyone who wants to analyze their spending habits, track their n⛄et worth, and do some retirement planning might check out Empower.

Does Empower Have High Fees?

When compared with the 澳洲幸运5官方开奖结果体彩网:average fee of 1% of in༒vestable assets charged by traditional financial advisors, the fees are reasonable. If you’re comparing the Empower 0.89% AUM fee to robo-advisors with human financial advisors like Betterment, SigFig, or Schwab, the fees are high.

The Bottom Line

Empower offers high-level investmen🍃t analysis software for the low cost of a phone call with a🍸 company representative.

For those with $100,000 or more in investable assets, the opportunity for an investment review and conversation with a licensed financial ♒advisor can be quite valuable. This opportunity makes checking out Empower a viable strategy.

The high-yield, fee-free cash account is ﷽also a worthwhile place for short-term cash♛ needs. 

The paid wealth management services are best compared with those of a traditional financial advisory service. The 0.89% investment management fee is lower than som🐻e traditional financial advisory firms and in line with others.

The smart-weightin𓆏g diversification model, unlimited access to financial advisors, tax-minimization strategies, portfolio customization, and goal-focused strategies are worth investigating.🍃

Empower makes 🥃i꧑t easy to decide whether to invest with the company with accessible access to financial advisors and responsive customer service.

How We Picked the Best Robo-Advisors

Providing readers with unbiased, comprehensive reviews of digital wealth management companies, more commonly known as robo-advisors, is a top priority of Investopedia. To collect data for our 2024 best robo-advisor awards and ra▨nkings, we sent a digital survey with 64 questions directly to each of the 21 companies we included in our rubric. Our team of reseꦏarchers verified the survey responses and collected any missing data points through online research and conversations with each company directly. The data collection process took place from Jan. 8 to Feb. 9, 2024.

We then developed a quantitative model that scored each company to rate its performance across nine major categories and 59 criteria to find the best robo-advisors. The score for each company’s overall star rating is a wei🍌ghted average of the criteria:

• Goal Planning - 21.00%
• Portfolio Contents - 17.00%
• Portfolio Management - 17.00%
• Fees - 15.00%
• Account Services - 10.00%
• Account Setup - 5.00%
• Customer Service - 5.00%
  
• Security & Education - 5.00%
• User Experience - 5.00%

Many of the companies we review for our projects grant our team of expert writers and editors access to live accounts so they🅘 can perform hands-on testi༒ng. Robo-advisor companies allowed us to do this, as well.

Through this all-encompassing data collection and review process, Investopedia has provided you with an unbiased and thorough review of the top robo-advisors. Read more about 澳洲幸运5官方开奖结果体彩网♔:how 🍌we research and review robo-advisors.

The above material and content should not be considered to be a recommendation. Investing in digital assets is highly speculative and volatile, and only suitable for investors who are able to bear the risk of potential loss and experience sharp drawdowns. Digital assets are not legal tender and are not backed by the U.S. government. Digital assets are not subject to FDIC insurance or SIPC protections.