Financial advisory services: Vanguard Digital Advisor vs. Personal Capital (Empower Personal Dashboard)
Quick Verdict
Vanguard Digital Advisor is a cost-effective choice for investors with smaller portfolios who are comfortable with a fully digital experience. Personal Capital is better suited for high-net-worth individuals who value access to financial advisors and more sophisticated planning tools, and are willing to pay higher fees.
- Vanguard Digital Advisor offers significantly lower advisory fees and a much lower minimum investment amount compared to Personal Capital.
- Personal Capital provides access to financial advisors, while Vanguard Digital Advisor is an all-digital service.
- Personal Capital offers more comprehensive financial planning tools, including a Retirement Planner with Monte Carlo simulations.
- Both platforms offer tax-loss harvesting and personalized advice, but Personal Capital emphasizes 'Smart Weighting' for diversification.
- Vanguard Digital Advisor has a more limited investment portfolio composition, primarily using Vanguard ETFs.
Key features – Side-by-Side
| Attribute | Vanguard Digital Advisor | Personal Capital (Empower Personal Dashboard) |
|---|---|---|
| Minimum Investment Amount | $100 for each Vanguard Brokerage Account and $5 for eligible 401(k) retirement accounts. | A minimum of $100,000 in investable assets is required to enroll in Empower Wealth Management services. |
| Annual Advisory Fee | 0.20% for an all-index portfolio or 0.25% for an active portfolio option. The net advisory fee is approximately 0.15% for a typical investment portfolio. New clients may have this fee waived for the first 90 days. | For the first $1 million, the advisory fee is 0.89% annually. The fee decreases for higher balances: 0.79% on the next $2 million, 0.69% on the next $5 million, 0.49% on assets over $10 million |
| Investment Portfolio Composition | Offers three investment portfolio options: All-Index, Active/Index, and ESG. Portfolios are built using Vanguard ETFs and may include tax-exempt municipal bond funds. The All-Index portfolio primarily uses four Vanguard ETFs: Total Stock Market (VTI), Total International Stock Market (VXUS), Total Bond Market (BND), and Total International Bond Market (BNDX). | Diversified portfolios of stocks and ETFs are created based on your financial goals. The service uses six asset classes: U.S. stocks, international stocks, U.S. bonds, international bonds, alternative investments, and cash. Clients can opt to incorporate socially responsible investing (SRI). "Smart Weighting" is used to more equally weight portfolios across size, style, and sector. |
| Tax-Loss Harvesting | Yes, it is included in the advisory fee. It sells loss-making investments to offset gains within your portfolio. | Empower practices tax-loss harvesting, which can increase after-tax returns. Tax-loss harvesting can save money and improve after-tax return. Up to $3,000 per year can be deducted in realized losses from ordinary income. Capital losses can be used to offset capital gains, creating a tax-deferred benefit that can compound over time. |
| Financial Planning Tools | Includes tools like a debt calculator, goal optimizer, and emergency fund tool. Also offers retirement planning tools and calculators. | Retirement Planner: Projects future investment balance and success likelihood using inputs like current investments, Social Security estimates, and planned savings. It uses real data and Monte Carlo simulations. Savings Planner: Helps determine how much to save for future education costs. Budgeting and Cash Flow: Tracks income and expenses to help users stay on track. Investment Checkup: Assesses portfolio risk and provides a target allocation. Fee Analyzer: Identifies hidden fees in investment and retirement accounts. Net Worth Tracker: Provides an accurate view of assets minus liabilities. |
| Access to Financial Advisors | No, Vanguard Digital Advisor is an all-digital service without access to human financial advisors. For access to financial advisors, consider Vanguard Personal Advisor. | Access to a financial advisory team is provided. Clients with over $250,000 invested get two dedicated financial advisors. Financial advisors offer support for various financial planning needs. |
| Account Types Supported (e.g., IRA, Roth IRA, taxable) | Individual and joint taxable accounts, Traditional IRAs, Roth IRAs, Rollover IRAs, SEP IRAs, Inherited IRAs, revocable trusts, and eligible 401(k) retirement accounts. | Empower Personal Dashboard works with various financial accounts, including checking, savings, investment, and IRA accounts. Also supports mortgage, home equity loans, and credit cards. Specific accounts include Taxable (Individual, Joint, Trust), Tax Deferred (Traditional IRA, Rollover IRA, SEP IRA, 401(k)), and Tax Exempt (Roth IRA, Roth 401(k), Charitable trusts). |
| Mobile App Availability and Features | Mobile apps are available on the Apple App Store and Google Play. | Empower has mobile apps for both Android and iOS. The mobile app is user-friendly and includes features such as net worth tracking, budgeting, and investment analysis. The app provides a complete picture of finances by bringing everything together. |
| Goal Setting and Tracking | Helps clients identify retirement and non-retirement goals and crafts customized investment portfolios to achieve them. | Empower allows users to set and track savings goals. It helps consolidate transactions and track progress toward goals. |
| Personalized Advice | Provides personalized glide paths based on factors like age, risk attitude, and marital status to find an appropriate asset mix. | Empower offers personalized financial strategies based on individual financial situations and goals. The service considers risk tolerance and personal preferences when creating a recommended portfolio. |
| Customer Support Channels | Customer support is available via phone during business hours (Monday-Friday, 8 a.m. - 8 p.m. ET). | Empower offers a customer service phone line. Email support is also available. |
| Security Measures | Information not available in the provided context. | Empower uses multiple layers of security to protect financial data. Data is encrypted with AES-256 with multi-layer key management. It has strict internal access controls. Two-factor authentication is required for logins from unknown devices. The platform uses secure internet security protocols. |
| App Ratings | Apple app: 4.7 stars. Android app: lower ratings due to awkward and incomplete functionality. | Not available |
Overall Comparison
Vanguard Digital Advisor: Advisory fees from 0.15% and minimum investment of $100. Personal Capital: Advisory fees from 0.89% and minimum investment of $100,000.
Pros and Cons
Vanguard Digital Advisor
Pros:
- Low advisory fees compared to other robo-advisors
- Offers tax-loss harvesting
- Provides a variety of financial planning tools
- Supports a wide range of account types
- Offers personalized advice based on age, risk attitude, and marital status
- Helps clients identify financial goals and crafts diversified portfolios
Cons:
- No access to human financial advisors
- Android app has received lower ratings due to awkward and incomplete functionality
- Certain non-Vanguard mutual funds, individual bonds, and securities traded on international exchanges are not allowed.
Personal Capital (Empower Personal Dashboard)
Pros:
- Diversified portfolios of stocks and ETFs
- Smart Weighting for diversification
- Tax-loss harvesting to minimize tax liabilities
- Retirement Planner uses real data and Monte Carlo simulations
- Access to financial advisors
- User-friendly mobile app
- Personalized investment strategies
Cons:
- Minimum of $100,000 in investable assets required for Wealth Management services
- Advisory fees are on the higher end compared to some other online advisors
User Experiences and Feedback
Vanguard Digital Advisor
What Users Love
- Clean, intuitive interface on Apple app
- Effective in helping set and track financial goals
- Personalized coaching and actionable digital reminders
Common Complaints
- Awkward and incomplete functionality on Android app
Value Perception
- Lower fees than many other robo-advisors
Personal Capital (Empower Personal Dashboard)
What Users Love
- Offers personalized financial strategies
- Provides a Retirement Planner, Savings Planner, and budgeting tools
- Mobile app is user-friendly and intuitive
- Helps users set and track savings goals
- Consolidates financial data to provide a clear view of progress
- Offers tax-loss harvesting
Common Complaints
- Advisory fees are on the higher end compared to some other online advisors. For balances under $1 million, the fee is 0.89% annually.
- A minimum of $100,000 in investable assets is required to access Empower Wealth Management services.
Value Perception
- No value feedback reported.
User Recommendations
- Empower creates diversified portfolios across multiple asset classes, including U.S. stocks, international stocks, U.S. bonds, international bonds, alternative investments, and cash.
- The mobile app is user-friendly and intuitive. It offers features such as net worth tracking, budgeting, investment analysis, and access to financial planning tools.
- Empower offers personalized investment strategies based on individual financial situations, goals, and risk tolerance.