As I am starting business school in the fall, I have been wondering for months whether my financial situation is in a solid position for taking on a bunch of debt. My gut response is “yes,” but I wanted to back that up with real data…a mathematical/graphical overview of my financial situation.  A few months ago, I started googling for online financial planners, but the only one I could find was LearnVest and the reviews didn’t sound too promising. I wanted a site that would allow me to enter my current salary/investments and future expenses by date (grad school, wedding, kids, etc) to see whether I was on track given by estimations. I even thought about maybe creating such a site on my own while in business school. A few weeks went by and low-and-behold my hopes were answered. LifeHacker posted an article about a site, Pefin, that promised to deliver exactly what I was looking for in a automatic financial  planner.

The Wait

I signed up sometime in November when I read the LifeHacker article and was told that I was on a waiting list. I waited for two months of silence before I decided to reach out on Twitter:

So I waited some more….until….

 

email pefin

 

The Sign-Up Process

Excited that I finally got the invitation, I eagerly signed up that night. The on-boarding process was similar to other financial sites like Mint, but of course asked some financial lifestyle questions. Like many other financial sites, you also add all of your active financial accounts (brokerages, savings, checking, credit card, 401K/IRA, etc). Here are some screen shots from my sign up.

pefin on boarding welcome screen

Pefin Welcome Screen

 

pefin onboarding goals

Goals

pefin account setup

Account Setup

 

Demographic Information

In addition to the general goal and account info, Pefin asked for a few demographic questions.

Overall the sign-up experience was painless, though I was a little concerned with the lack of features. Unfortunately, once I submitted the final form and the site said that it was calculating my financial plan, it hit an error. Not surprising considering it’s in beta 🙂

Pefin Error

The error

The Main Dashboard

Once the CTO helped me fix the error, I was on my way! I logged in to my dashboard and saw an overview of my current financial situation as well as a graph of my financial picture over time.

Current Financial Picture

Not much different from any other financial aggregation software, such as Mint or Personal Capital, the financial overview section gives your overall net worth and debt, total investment value, and spending habits for the past month. For some reason, this section didn’t do a very good job of calculating my credit card debt, calculating it at ~$300 instead of $3000 (mostly all from business school deposits). Since I use Mint primarily for calculating my net worth, this doesn’t concern me very much, but definitely something for the developers to consider since I don’t have to touch Mint and it calculates it correctly.

Projected Financial Picture

The next section is the money graph, no pun intended. This is the graph I had been searching for in a financial planning tool, a way of adding life events, such as college or kids, and seeing whether I would still have money for retirement. I am actually very happy with how Pefin implemented this section. I could easily spend hundreds of dollars and several weeks getting this same picture from a Certified Financial Planner. Though Pefin will cost some money (see Pricing section) once the beta period is over, it is great getting this graph for free now!

Financial Picture with Life Events

Financial Picture with Life Events

Things That Could Be Better

More Life Event Options

Understandably, Pefin is in beta, so some of the options are limited with a few labeled as “TBD.” From the start, they offer the following life events: child, retirement, income change, college, and home with the following grayed out: gift, car, vacation. There are several others that I was hoping they would include since they pertain to my life:

  • Grad school: Considering that I will be starting my MBA in August, I was hoping I would be able to add my grad school expenses. Unfortunately, the college option only allows you to select 4-year college with assumed cost-to-attend estimates; no way to enter your actual cost. I jerry-rigged the app for grad school by saying I will attend college for 4-years at a rate equivalent to what my loans will be and by  saying I’ll have an income change. Not perfect, but good enough for testing the app.
  • Pets:  I’ve been holding off on getting a dog until after business school. 1) Because of the time investment needed and 2) it’s quite costly. Would love to have the option to add a pet to my timeline.

 

Other Issues

  • Frequent Logouts: When I first set up my account it seemed to log me out very frequently. It’s seemed to calm down a bit now, but if I close the tab in my browser, the Pefin session is gone.
  • User experience: There are several quirky UX problems with the tool such as pop-ups not being able to close with the ESC button, input boxes that need to be tapped just right, etc. I’ve submitted some feedback on these issues and it sounds like they’re being remediated, but it can be confusing sometimes.
  • Financial Timeline Lag: I have noticed that sometimes when I add a life event to the timeline, it will say that my plan is affordable. However, when I log back in a day or two later, it will be refreshed and say that my plan is no longer affordable. Might be some “wizard-of-oz” mimicry for the beta test, but definitely odd.

 

Pricing

You’d think that having an online tool based on AI would be cheaper than a real in-person conversation and you’d be mostly right! A regular fee-only financial planner costs about $1000-$2000 to deliver a financial plan, but Pefin will only charge $12/month after the beta period ends. Unless you’re only getting a financial plan done every 7 years or longer, Pefin is the more economical choice!

 

Final Thoughts

So far, Pefin has been working pretty well. Despite being in beta, it is still fairly robust and I would recommend checking it out. Can’t wait to see what it’s like in the next year or two as they roll out new features and capabilities.