Empower Review: Helping You Make Smarter Investment Decisions
Written by
Jacob Wade
Edited by
Melanie Grafil
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GOBankingRates Score
Empower
-
Financial Tools
4.8
-
Advisory Services
4.0
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Investment Selection
4.0
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Fees
4.5
Empower Overview
Empower is a financial management platform and financial advisory service that offers free financial tools and complete portfolio management, depending on your investment balances. Anyone can download the Empower Personal Dashboard app, which was formerly known as Personal Capital, and connect financial accounts to track your budget and net worth.
If you have $100,000 or more invested, you can hire Empower Wealth Management to help evaluate your investments, make financial goals, and create an investment strategy and portfolio. You will have access to a team of fee-only financial advisors–many of them CFPs–that you can schedule a meeting with any time during business hours.
Key Features
Empower offers a free app with tons of features, as well as full-service wealth management to oversee your investments. Here are a few key features that Empower offers:
Financial Tools
Empower acquired Personal Capital in 2020, and continued to offer the free financial tools that Personal Capital was famous for. The Empower Personal Dashboard app is free to download, and offers budget tracking, net worth tracking, investment track and analysis and a few other cool financial tools.
Two of the best tools available are:
- Retirement fee analyzer. The retirement fee analyzer will review your investments and allow you to slide the “additional fee” input to see how fees impact your investments. This tool is eye-opening, as it shows how just 1% or 2% in investing fees can make a massive impact on your returns.
- Retirement planner. The retirement planner lets you input your income, contribution, investment returns, and financial goals to see a full picture of your future finances. The tools show you how much you can expect in growth, as well as the odds of your money lasting throughout retirement.
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Advisory Services
Empower Wealth Management is a traditional fee-only advisory service that offers financial advisor services for a modest fee. There are different tiers of services depending on the size of your investment portfolio:
- Investment services ($100k to $250k): Standard advisory services offer access to a team of financial advisors that can help review your investments, set financial goals and create a portfolio of low-cost ETFs for you. You can call an advisor any time during business hours, which are Monday through Friday, and review your investments at any time.
- Wealth management ($250k to $1 million): If you have over $250k invested, you gain access to two dedicated financial advisors that you can call anytime during business hours. You also can invest in individual stocks and other assets, such as real estate and options. You also gain access to more advanced tax strategies.
- Private client ($1 million and above): If you have $1 million or more invested, you gain priority access to your dedicated financial advisors, as well as a wealth-planning specialist. If you have $5 million or more, you gain access to private equity investing.
Investment Selection
For most Empower clients, your investment portfolio is constructed of low-cost ETFs in multiple sectors and asset classes. Empower utilizes Modern Portfolio Theory in their investment approach, keeping costs low while diversifying among multiple investment funds.
For clients with larger portfolios, Empower also offers access to individual stocks and options strategies, as well as private equity and alternative assets. The investment selection is advisor-driven, but as a client you have the ultimate say in portfolio construction.
Fees
Empower offers a lot of free financial tools, making it one of the best values out there for digital financial planning tools. Empower’s advisory services utilize a fee-only approach, charging an assets under management fee as a percentage of your entire portfolio.
The fees starts at 0.89% annually, but go lower the more you have invested:
- $100,000 to $1 million: 0.89% annual fee
- $1 million to $3 million: 0.79% annual fee
- $3 million to $5 million: 0.69% annual fee
- $5 million to $10 million: 0.59% annual fee
- $10 million and above: 0.49% annual fee
The fees for most of the ETFs within your portfolio are below 0.15% annually, with many at 0.05% or less. And there are no fees for holding individual stocks.
How Empower Stands Out
Empower offers some of the best free financial planning tools on the market, allowing you to connect your financial accounts and quickly see how your investments are doing. Empower also offers financial advisory services to clients with $100,000 or more invested.
Empower follows a low-cost investing strategy to help grow your investment portfolio. It also offers access to a team of advisors you can call anytime during business hours. Their advisory fees are below industry standards, making Empower a solid choice for hiring an advisor.
Comparable Financial Advisor Options
While Empower offers free financial tools and advisory services for some clients, there are other financial advisors you may want to compare them with. Here are a few other choices for advisory services:
Fidelity Wealth Management
Fidelity is a large broker that offers a wide range of investment services, including wealth management. You can hire a Fidelity advisor to help you set financial goals, set up investing accounts and help manage your investments for you. The fees range from 0.50% to 1.50% annually, depending on your investment balance.
Vanguard Personal Advisor
Vanguard Personal Advisor is a low-cost advisory service that gives you access to a team of financial advisors that can set up and manage your investments utilizing Vanguard low-cost funds. The service has a very low 0.30% annual advisory fee–plus you gain access to a simple-to-use investment dashboard. Vanguard Personal Advisor doesn’t let you pick individual stocks, but allows you to customize your investments through different types of funds.
How To Apply
To apply for Empower, you can sign up for a free account online by just providing an email address and password, plus your phone number. Once you’ve signed up, you can start connecting your financial accounts to track your spending and investments.
If you link investment accounts worth over $100,000, you may receive a call from the Empower wealth management team to offer advisory services. To enroll, you’ll need to speak with a representative, complete an application and agree to having Empower manage your investments for you. You’ll also pay an annual fee for the services provided.
Who Empower Is Best For
Empower is great for investors that want smart tracking and analysis tools to keep an eye on your finances. The tools are free, and the mobile app makes it easy to see how you’re doing from anywhere.
Empower wealth management services are best for those looking to plan for retirement and larger financial goals that want personalized help with their investments. Having access to a team of advisors that can create a customized investment portfolio and answer any money questions you have may be worth the cost. But just be aware that the annual fee may hurt your overall returns.
Final Take
Empower is a popular investing app that offers free tools to help you make smarter investment decisions. It also offers full-service financial advisors that can manage your investments for you, help with setting financial goals and help you plan for retirement.
The advisory service does come with an annual fee, but it’s lower than most other advisors out there. Plus, Empower focuses on utilizing low-cost ETFs to build a diversified portfolio–offering better performance and lower fees as opposed to an active investing approach.
Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.
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