Keeping track of your investment accounts is no small task. Between your employer’s 401(k) plan, one or more individual retirement accounts (IRAs), a health savings account (HSA) and taxable investment accounts, you could end up managing more than a few investment portfolios. My wife and I have more than a dozen.
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Juggling multiple accounts is a big job that comes with big challenges, like building an asset allocation plan, tracking performance and logging into multiple accounts. Keeping an eye on expenses across accounts can involve serious mental gymnastics.
One effective solution is to use software or an app to manage the process. Let’s take a look at five investment tracking apps available today that I consider to be the best.
Personal Capital offers a free financial dashboard that I’ve used for many years. In my opinion, Personal Capital is the best overall investment tracking solution available today.
Begin by opening a free account, and then link your various financial accounts to the Personal Capital platform. For me, this includes not only my 401(k) and individual retirement account, but also taxable investment accounts, bank accounts and credit card accounts.
Once your accounts are linked, Personal Capital’s dashboard aggregates all of your financial data and provides a wealth of information and analysis. Focusing on its investment tools, Personal Capital provides the following high-level information:
It classifies your investments between retirement and taxable accounts.
It displays your investments by account or by individual holding.
It tracks your investment performance over time, comparing your returns to several benchmarks.
Personal Capital also organizes your investments by asset class. It does so using the following investment categories:
Cash
International bonds
US bonds
International stocks
US stocks
Alternatives
In addition to aggregating and sorting your account and investment data, Personal Capital provides tools that provide insight into your retirement investments, the fees you’re paying and an investment checkup that looks at your overall asset allocation
How Does Personal Capital’s Retirement Planner Work?
Personal Capital offers a robust retirement planner that incorporates all of the holdings in linked accounts, along with spending data from the linked bank and credit card accounts. The retirement planner enables you to add specific income events, such as Social Security and planned pre-retirement savings. You can also add spending goals, such as a trip around the world that you plan to take after you retire.
The retirement planner enables you to set your effective tax rate, an assumed inflation rate and your life expectancy. You can also create multiple retirement scenarios that can then be compared. For example, you could create two different scenarios with different spending levels.
With these data points, the retirement planner calculates the chance your portfolio will support your retirement goals. The tool also provides a detailed cash flow table through your assumed life expectancy.
How Does Personal Capital’s Fee Analyzer Work?
Personal Capital’s retirement fee analyzer calculates your overall expense ratio across all of your investments. In my case, fees totaled 6 basis points. The tool then shows you the amount of fees you’ll pay over time and the effect they will have on your portfolio returns. The tool is designed to calculate your fees up until your date of retirement. This date can be changed so that you can see the impact of fees over a longer period of time.
How Does Personal Capital’s Investment Checkup Work?
Finally, Personal Capital offers what it calls an investment checkup. This tool analyzes your current asset allocation and compares it to a recommended asset allocation. For both allocations, Personal Capital shows you historical performance, future projections and risk and return expectations.
The Morningstar Portfolio Manager takes a different approach than Personal Capital’s financial dashboard. With Morningstar, you must manually enter each of your investments into its Portfolio Manager tool (although the company says it’s working on an automated solution).
While it takes more work to enter your investment account data into Morningstar’s Portfolio Manager, the analysis provided by the tool is well worth the effort. The tool provides basic data about each of your investments, including its current price, daily changes in value and its percentage weight in your overall portfolio.
Morningstar’s Portfolio Manager also provides robust data on overall portfolio performance. It shows you your portfolio’s total return by month and year, and compares it to a benchmark of your choice. Where Morningstar really shines, however, is with its Instant X-Ray feature.
Instant X-Ray gives you detailed information about your portfolio’s asset allocation. It shows you the investment style box of your portfolio for both stocks and bonds. It breaks out your investments by sector, stock type and even by region. And it shows you the weighted average mutual fund expense ratio of your portfolio.
Finally, Instant X-Ray shows you what percentage each individual investment in your portfolio represents in your portfolio as a whole. This can be particularly useful for those who invest in mutual funds. In my case, Apple represents just over 13% of my portfolio. That’s due in part to direct ownership of Apple stock, but also to the heavy weight given to large companies like Apple in index funds that are also part of my portfolio.
Morningstar offers both a free and paid membership. You can use its Portfolio Monitor with either membership, although some tools require a paid membership.
eMoneyAdvisor’s Retirement Cash Flow Analysis
eMoney Advisor is available from financial advisors. While I manage my own investments, I do use an advisor to discuss questions from time to time. As a result, I have access to this tool. Similar to Personal Capital, eMoney Advisor aggregates all of your financial data by linking your accounts.
While the interface is not as polished as Personal Capital, eMoney Advisor does provide a wealth of information, and its portfolio analysis is quite sophisticated. Specifically, it can project future cash flows of a portfolio through retirement, and it’s this feature that I’ve found to be the most valuable.
Specifically, eMoney Advisor will project cash flows throughout your retirement based on a number of data points and assumptions. It takes into account future Social Security payments as well as the required minimum distribution (RMDs) of tax-deferred retirement accounts. It enables you to set an amount for annual spending in retirement, and then adjusts it for inflation.
The resulting cash flow report is broken down by year. For each year, it shows you your total income, investment income and planned retirement distributions. It also shows total expenses, which can include not only annual expenses adjusted for inflation, but also one-time expenses you plan to incur during retirement. Finally, it shows the total portfolio over time.
Beyond this cash flow report, eMoney Advisor provides the type of portfolio data and analysis you would expect. It breaks out a portfolio’s asset allocation and offers data on estate planning and tax issues.
Portfolio Analysis with Quicken Premier
Quicken Premier offers investment tools to track and analyze a portfolio. It’s well-suited for those who prefer software over an online app, and the Premiere version of Quicken allows you to connect your investment accounts to the software. Once an account is connected, Quicken tracks investment activity, including all transactions in the accounts. What’s particularly noteworthy is Quicken’s use of Morningstar data.
For example, Quicken will show you the Morningstar category of each investment, its rank in that category, the Morningstar rating and other Morningstar data. Quicken also gives you access to Morningstar’s Instant X-Ray tool described above. In this, you get access to the data offered by Morningstar without having to manually enter your portfolio.
Quicken also enables you to set a target asset allocation and then compares it with your portfolio’s actual asset allocation. You can review the asset allocation at the portfolio level, the account level or by individual security.
The one downside to Quicken is its user interface. The software looks like it hasn’t been updated in a long time. It’s functional, but not polished.
Build Your Own Spreadsheet in Google Sheets
If you would prefer not to link investment accounts to an online tool or software app, Google Sheets offers an excellent way to track your investments. While a Google Sheets spreadsheet requires you to manual enter your portfolio data, Google Finance functions can automatically update the market price of each security.
The spreadsheet that I use is particularly well-suited when it comes to rebalancing a portfolio. As helpful as the tools listed above are, I find myself going back to this spreadsheet each time I need to make an adjustment to my asset allocation. The sheet allows me to see the target allocation for each asset class, along with variance from target based on the market performance of my portfolio. In this short video (created for my own personal finance site), you’ll find a helpful tutorial on how to use the spreadsheet
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