If you’ve built up serious wealth and want more than a basic algorithm managing your money, Empower is worth a close look. It sits in a different category than most digital investment platforms because it pairs automated portfolio management with real human financial advisors, which means you get personalized guidance without paying full traditional advisor rates.
The catch is that Empower isn’t for everyone. You need at least $100,000 in investable assets to access its managed services. For those who qualify, the platform covers a lot of ground, from tax optimization and retirement planning to estate strategy and college savings.
This review breaks down Empower’s three service tiers, fee structure, investment approach, and free tools so you can decide if it makes sense for your financial situation.
Empower at a Glance
Empower has grown well beyond its roots as Personal Capital, the digital wealth platform it acquired and rebranded. Today, the platform has over 3.4 million active users and more than $200 billion in assets under management, which puts it among the largest hybrid advisory platforms in the country, second only to Vanguard Digital Advisor in total AUM among robo-advisory services.
The platform is split into two distinct experiences. Anyone can sign up for free and access Empower’s financial dashboard tools. But to get into the managed investing side, called Empower Personal Strategy, you need at least $100,000 in investable assets and will pay an annual management fee starting at 0.89%.
Empower Investment Plans and Account Tiers
Empower divides its managed services into three tiers based on how much you invest. Each tier builds on the one below it, adding more personalized services as your assets grow.
Investment Service Plan
The entry-level tier is designed for investors with between $100,000 and $200,000 in assets. At this level, you get access to a team of financial advisors by phone or email, a tax-efficient ETF portfolio, dynamic tactical weighting, 401(k) advice, and cash flow and spending insights. You also get full access to Empower’s free financial dashboard tools.
One thing to note: while your advisors can help you plan for accounts like a 401(k) or 529, Empower does not actually offer these account types directly. They advise on them, but you hold those accounts elsewhere.
Wealth Management Plan
The Wealth Management tier covers investors with between $200,000 and $1 million in assets. You keep everything from the Investment Service plan and add several meaningful upgrades.
The most significant addition is dedicated advisor access. Investors with at least $250,000 invested get two dedicated financial advisors rather than a general advisory team.
You also gain access to customizable stocks and ETFs, a full financial and retirement plan, college savings and 529 planning, tax-loss harvesting, tax location strategy, and support for financial decisions like insurance, home financing, stock options, and compensation planning.
Private Client Plan
The Private Client tier is for investors with more than $1 million in assets. It includes everything from the two lower tiers plus a more comprehensive set of services built for complex financial situations.
At this level, you get priority access to CFP professionals, the investment committee, and dedicated support. Your portfolio can include a mix of ETFs, individual stocks, and individual bonds depending on your situation.
Additional benefits include family tiered billing, private banking services, estate and legacy portfolio construction, donor-advised funds, deferred compensation strategy, and coordination with estate attorneys and CPAs. Access to private equity investments is available for portfolios above $5 million, which is a rare feature among digital advisory platforms.
Empower Fees and Account Options Explained
Empower uses a tiered fee structure where the percentage you pay decreases as your assets grow. Here’s how it breaks down:
- Up to $1 million: 0.89%
- Next $3 million: 0.79%
- Next $2 million: 0.69%
- Next $5 million: 0.59%
- $10 million and above: 0.49%
There are no additional charges for account setup, transfers, or closing your account. The advisory fee is all-inclusive, covering personalized portfolio management, financial planning, advisor access, and tax optimization strategies. While the fee is higher than many robo-advisors, it is still generally below the more than 1% that traditional financial advisors typically charge.
Account Types Supported
Empower supports a range of standard account types to cover most investors’ needs. Available accounts include:
- Individual and Joint Brokerage Accounts: Standard taxable investment accounts for individuals or co-owners.
- Traditional IRA: Pre-tax retirement contributions with tax-deferred growth.
- Roth IRA: After-tax contributions with tax-free growth and withdrawals in retirement.
- SEP IRA: Designed for self-employed individuals and small business owners.
- Rollover IRA: For moving funds from a former employer’s 401(k) or similar plan.
- Trust Accounts: For investors who hold assets in a trust structure.
The platform focuses on liquid investments, meaning your money is not locked up in illiquid assets. Most trades settle within one to three days if you need to access cash. All assets are held by Pershing LLC, a well-established custodian in the U.S. financial industry.
Empower Personal Cash
Empower also offers a free high-yield cash account for those who want a place to park money outside of their investment portfolio. The account carries an APY of 3.75% with no fees, no minimum balance, and no transfer limits, and you can link monthly bills to withdraw from it automatically.
This is worth knowing about if you are not yet at the $100,000 investment minimum, since it gives you a way to use Empower’s platform while you build toward that threshold.
Tax Optimization Strategies
Tax efficiency is one of the areas where Empower puts real effort into separating itself from simpler robo-advisors. The platform uses three main strategies to reduce the tax drag on your portfolio.
First, Empower avoids mutual funds, which it considers tax-inefficient compared to ETFs. Second, it uses asset location to place investments in the most tax-advantaged accounts possible. For example, high-yield assets and fixed income are typically placed in tax-deferred or tax-exempt accounts, and REITs are generally moved into retirement accounts because they pay nonqualified dividends.
Third, Empower applies tax-loss harvesting, selling individual securities at a loss to offset gains or generate a tax deduction. According to Empower’s own research, these strategies combined could boost annual returns by approximately 1%, though actual results will vary depending on your account mix and tax situation.
Investment Strategy and Tools
Empower’s investment approach is built around five core strategies that work together to balance growth and risk management across your portfolio.
Modern Portfolio Theory
The foundation of Empower’s approach is building efficient portfolios that aim for the highest possible return for a given level of risk. The platform works across six asset classes: U.S. stocks, U.S. bonds, international stocks, international bonds, alternatives including ETFs and commodities, and cash for liquidity. All asset classes are designed to be liquid and broadly investable.
Smart Weighting
Empower uses a proprietary feature called Smart Weighting, which re-weights your portfolio holdings to reduce overexposure to the largest companies in a given fund and deliver more return without taking on additional risk.
In a traditional ETF, mega-cap stocks tend to dominate the weighting, which means your returns are heavily tied to a small number of large companies. Smart Weighting is designed to correct that imbalance.
Personalized Asset Allocation
Empower looks at your individual financial data and goals to determine the right balance of risk and growth for your specific situation. The platform uses its Retirement Planner software to analyze your spending, savings habits, and projected income. This helps project what your financial future looks like and what adjustments may be needed to reach your goals.
Socially Responsible Investing
Empower offers socially responsible portfolios built using ESG rankings from third-party evaluator Sustainalytics. It selects top-scoring companies and applies its proprietary Smart Weighting methodology to that basket for the U.S. stocks allocation. This is an option worth exploring if you want your investments to align with your values without paying a premium for ESG-focused ETFs.
Disciplined Rebalancing
Your portfolio gets a daily review for potential rebalancing needs. High-level assets are generally rebalanced when they drift more than a few percentage points from their target. Individual securities are reviewed after just a 0.5% move from the target, which keeps your portfolio aligned with your strategy without overtrading.
Free Financial Tools
Even if you never invest a dollar with Empower, you can sign up and use its financial dashboard at no cost. These tools give you a comprehensive look at your finances across all linked accounts, including bank accounts, credit cards, and investments.
The free tools are genuinely useful and not just a sales funnel, though Empower will eventually encourage you to speak with an advisor once your linked assets cross a certain threshold. Here’s what you get:
- Investment Checkup: Analyzes your current asset allocation and flags areas that may need adjustment.
- Fee Analyzer: Scans your existing investment accounts for hidden fees you may not be aware of.
- Retirement Planner: Projects your long-term savings with best- and worst-case scenarios based on your actual numbers.
- 401(k) Analyzer: Reviews your employer-sponsored retirement plan for inefficiencies.
- Net Worth Tracker: Gives you a real-time view of your total financial picture across all linked accounts.
Is Empower Right for You?
Empower makes the most sense for investors who have significant assets and want a level of service that goes beyond what a standard robo-advisor provides. The combination of human advisors, tax optimization, Smart Weighting, and comprehensive financial planning gives it more depth than most automated platforms. If your financial situation involves multiple account types, estate considerations, or complex tax questions, the higher fee is easier to justify.
That said, if you are still building toward the $100,000 minimum or prefer a low-cost, hands-off approach, there are better-suited platforms available. Betterment and Wealthfront both offer tax-loss harvesting and automated rebalancing at 0.25% annually with no meaningful minimums. But if you are ready to put serious money to work with professional guidance behind it, Empower is a legitimate option worth a close look.
