I'm looking at moving our investments from our current investment company, primarily to save on fees but also to hopefully get a more proactive attitude from our advisor, as our current advisor has a buy-and-hold-and-hold-and-hold stance that has had only marginal success, even as the market has skyrocketed in the last half-year. There are other issues as well; it's just time, I think, to move on to something different. Please note: I have no plans to actively manage my own investments.

After exploring the big names (Fidelity, Schwab, Edward Jones, et al), I had intended on going with Vanguard (0.3% for personal assigned advisor account (not robo-account) with adequate funds)...low fees, low costs, good record of returns, reputable. One concern I had was the tax impact, given that they understandably encourage Vangard funds in their portfolios by requiring X amount of Vanguard funds in the portfolio to qualify for benefits (the assigned personal advisor, for example), so selling-and-buying that amount of equities at the outset was concerning.

Yesterday, however, we received a notice in the mail that Financial Engines has partnered with employer Microsoft to offer comprehensive investment management (or just 401K, if preferred...apparently that's been their bread-and-butter, and are now expanding harder into this comprehensive market) for .04% for employees. They have a local office, which I really like, and the management fee is also very good. I would like to think that they have been vetted adequately by Microsoft to protect their employees and avoid potential isses of liability or whatnot, but I've no idea. My only familiarity with Financial Engines before yesterday was their radio show, Investing Sense, that I listen to from time to time.

I haven't read through all the literature we received yet, but the above is the gist of it...local management, national corporate resources, low fee with comprehensive management of investments...and I wouldn't necessarily have to do a lion's share selloff at the outset. A quick Google search this morning of Financial Engines suggests they have a lot of money under management and I do not see many complaints/issues/litigation/etc. Can't seem to pin down their hidden costs, but I didn't see any suggestions that they were out of line with the industry.

Has anyone had experience -- past or present -- with Financial Engines, and what's your take on them?

I’ve never heard of Financial Engines, but I have never heard a radio program or commercial for financial or investment services that wasn’t deceptive in some material way.

Some of the Saturday mornings mutual fund programs are just awful. The best are thinly disguised sales pitches; the worst are even worse!

This message has been edited. Last edited by: JALLEN,

I have never heard of them either and would be leary of going with someone without a long term proven track record.
Your initial list (Vangaurd, Fidelity etc.) would be my reccomendations.
We have most of our funds with Fidelity. Which ever way you go there should not be any tax consequences if you roll over your 401K, IRA's.

Funny, I just got their mailer today.

It's actually 0.4%, not 0.04%. Still relatively cheap.

You can use their tools for free, now. Not sure how much more you're going to get from one of their advisors.

I've chosen to use an advisor who charges by the hour. Fiduciary, non-commissioned (similar to FE, in that respect). I shopped for her carefully, interviewing 5 others. I chose someone I trust. With FE, you're going to get whomever they assign to you.

With my assets, what I'm paying her for the yearly review is about 0.1-0.15%. And that will shrink as my assets grow, if we spend the same amount of time each year. YMMV. Of course, she gives me the plan and I need to execute the trades. She doesn't manage money for people.

Shoot me an email if you want her contact info. She's a former fund manager and V.P. for American Century Investments. I've found her to be great to work with.

I used Financial Engines for a while--too long. If you subscribe to the paid version (which is the 0.3% you mention), they take over management of ALL decisions on your account. You can talk to them about your priorities, but you CANNOT change allocations, change investments, or make any significant decisions.
In my case Financial Engines was using a faulty assumption about my goals, timelines, and other investments, so they had my account far too conservative.
If you have any inclination to make your own decisions--and mind you, you might well make worse decisions than they do--you don't want to use FE. My staying with them too long cost me a lot in a bull market.

showpro: Yes, sorry -- meant to t ype .4%, not .04%...that latter figure would be a helluva deal. Thanks for the lead on the hourly advisor...not sure that's the direction I want to go, but if I decide to, I'll be sure to give you a holler.

sjtill, thanks for the feedback on your experience...I'll definitely need to followup and look into the concerning issue you mention before I do anything with them.

Anyone else with experience? I've put off making a change long enough...I need to pull the trigger on something here in the next week or two.

I doubt any of us has ever read a prospectus or other sales literature for investment management without encountering the phrase, “Past performance is no guarantee of future results."

Yet, that is virtually the only metric one ever sees in use for deciding between competing alternatives.

The reality is that results vary all over the place over time. Ranking results from best to worst for different years seldom sees the same fund or advisor in the highest ranking.

One unfortunate result of this very common practice is to force fund managers to focus too much on short term results rather than long term performance. This means that mistakes are not awful as long as everyone makes the same mistake. Clients switch to the highest ranking managers and avoid the lesser ranked ones. A manager who finds an attractive investment may hesitate to load up when the consequences of being the only one to do so can be severe if it doesn’t prove out. The only long term view may be from the unemployment line!

I would start at www.cfp.net.

I am not sure your investable assets but I am assuming they are substantial enough to require management. If you have less than $500k. I would not recommend paying additional fees to "manage" your account. Basically below that asset level, most financial companies are providing a sophisticated asset allocation to institutional class mutual funds. Your all in costs may still be over 1% and that is just a lot of money to give away in fees.

If you have less than $500k, vanguard has lots of free tools to determine your risk tolerance and then you can buy your own index funds and pay all in less than 0.25% in fees.

If you have over $500k, find a fee based CFP financial planner. I would shy away from the big names, it costs a lot of money to run commercials and support all that back office. Interview a couple CFPs and ask them how they would manage your assets and your risk.

You cannot control returns, you can only control fees and risk.

A good site for finding a fee-only FP: https://www.napfa.org/find-an-advisor