As we are getting closer to retirement age, I was looking for an easy way to find out where we were truly at financially. Were we on track to retire?
Everything I read said you needed eight times, nine times, even ten times your current salary saved up. Did we have that? If not, how much money did we actually have?
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Image source: Fidelity.com
Even though I am the "bill-payer" of the family, I truly didn't know. Just like you, we had random asset accounts scattered around (banks, retirement and stock accounts), plus various liability accounts (credit cards, mortgage and car payments). I looked around for an easy net worth calculator where I could link all of my accounts and I found one that I really like (it's free)! When I started it was called Personal Capital, but it is now called Empower.
Initially, I was a little hesitant to start linking my accounts and adding my passwords; however it was easy to do and the multi-factor authentication makes me feel secure.
Linking simply means that you add your login information for each account that you have.
Things like:
- Checking/Savings Accounts (for each bank that you use)
- Retirement Account Information (401K, IRA, Mutual Funds)
- Individual Stock Account Information (Etrade, in my case)
- Health Savings Accounts (HSA)
- Mortgage, Home Equity Loans
- Car & Student Loans
- Whatever other asset/liability accounts that you have...
Most accounts will update automatically each time you log-in, but a few need you to authenticate inside Empower each time. (One of mine is Huntington Bank, so every couple of weeks I just click "fix account" and enter the code texted to my phone to get it to update.)
Note: Since I am the person who pays the bills, my husband doesn't know much about any of these accounts. This is a nice SINGLE login spot where you can direct them if there is ever a need for them to take over.
You can click on individual accounts and get up to date transaction history, but Empower also emails me a "Daily Financial Monitor". I can see all of the transactions that happened in my linked accounts every day (which is very eye-opening). Once a month, they also send me a graph of this month's spending vs. last month's (also very eye-opening).
Here is a snip of our total net worth. Of course, there is quite a bit of volatility in the stock market, so if that part makes you nervous just don't login very often. 😀 Even though there are clearly ups and downs, the overall trend is going up (which is good). It will even tell you what it thinks your house is worth in the current market (using Zestimate). Your house is a valuable addition to your overall net worth that we sometimes forget about.
I truly love this tool! It is giving me confidence that I know where all of our money is and that we can actually start contemplating retirement. Empower is simply a wonderful tool to help you get financially organized once and for all.
Note: If you are the future executor of someone's estate, do yourself a favor and get them to start an account too!
Cheers!
Karen
It's FREE!
