Getting rid of Financial Engines

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peregrine
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Getting rid of Financial Engines

Post by peregrine » Wed Jan 04, 2017 10:15 am

My husband has a 401(k) from a previous employer which is serviced by Fidelity. He has not moved it to the 401(k) of his current employer because the old 401(k) has low cost investment options. Financial Engines has apparently been enlisted to provide advice for holders of these accounts.

This situation started when someone from Financial Engines told my husband he had signed up for the financial advisory service. My husband has no recollection of signing up for this service. He was informed that if he quit the service he would be charged for the small amount of time he had the service but if he signed up for the 3 month free trial he would not be charged anything. So he said he would take the 3 month free trial, intending to drop it before he was charged. I asked at the time if he had given Financial Engines permission to trade in his account and he replied that that was not his understanding of the conversation.

So now Financial Engines is trading in his 401(k) account. To say that my husband is furious is a gross understatement. He never signed anything. Financial Engines will no doubt claim he gave them permission over the telephone but if he did then they were very unclear about what he was giving them permission to do. It appears to me that Financial Engines had taken a play out of the Wells Fargo playbook.

How do we get Financial Engines out of his 401(k) and out of our lives (they call him at home) without actually paying them to go away? My husband tried contacting Fidelity to tell them Financial Engines did not have permission to trade in his account. Fidelity refused to get involved and told him he had to deal with Financial Engines.

This behavior is at the very least highly deceptive. To what government agency can we report it? the SEC?, the Department of Labor?, the Consumer Protection Bureau? All of the above?

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Re: Getting rid of Financial Engines

Post by Jack FFR1846 » Wed Jan 04, 2017 10:23 am

I had the "option" to use FE when in a previous job with the 401k through UBS. After lots and lots of spamming to use them, I called them to ask what they were all about. They briefly explained what they did. I told them I had no interest in them touching my account.

If I had found that they indeed signed me up, I'd be contacting:
Financial Engines to complain that I had not signed up and want them out of my account.
UBS (Fidelity in your case) to tell them to make sure FE has no access to my account.
My HR department to complain loudly about FE and to make them aware that I want nothing to do with them.
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Re: Getting rid of Financial Engines

Post by livesoft » Wed Jan 04, 2017 10:26 am

I'd get rid of them the same way one gets rid of any of these services.

This is the way:
If I had found that they indeed signed me up, I'd be contacting:
Financial Engines to complain that I had not signed up and want them out of my account.
UBS (Fidelity in your case) to tell them to make sure FE has no access to my account.
My HR department to complain loudly about FE and to make them aware that I want nothing to do with them.
Talking to a government agency will do you about as much good as talking to bogleheads. They (we) cannot help you make the calls.
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student
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Re: Getting rid of Financial Engines

Post by student » Wed Jan 04, 2017 10:28 am

This is horrible. Perhaps the most painless way, but not necessarily the most profitable way, is to simply roll it over to his current 401k. (I understand that you mentioned the options are not as good.) I am surprised that Fidelity is not willing to get involved. Perhaps contact Fidelity again and suggest that if this is not resolved, you will roll it to his current 401k or an IRA at another institution.

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peregrine
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Re: Getting rid of Financial Engines

Post by peregrine » Wed Jan 04, 2017 10:31 am

Thanks for quick replies. Financial Engines wants to charge us to get out of this situation - unless we continue it for 3 months. Fidelity refuses to get involved and says we must deal with Financial Engines. How can we prevent Financial Engines for charging us for this "advice" that we never wanted in the first place?

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Re: Getting rid of Financial Engines

Post by student » Wed Jan 04, 2017 10:37 am

peregrine wrote:Thanks for quick replies. Financial Engines wants to charge us to get out of this situation - unless we continue it for 3 months. Fidelity refuses to get involved and says we must deal with Financial Engines. How can we prevent Financial Engines for charging us for this "advice" that we never wanted in the first place?
How much money are we talking about? To me, the question is whether it is worth your time. Benefits office is the one carries the biggest stick but he have already left the company so getting this office involved may be difficult. Sorry, no other ideas.

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Re: Getting rid of Financial Engines

Post by sport » Wed Jan 04, 2017 10:37 am

How much do they want to charge you?

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Re: Getting rid of Financial Engines

Post by qwertyjazz » Wed Jan 04, 2017 10:39 am

State attorney general's office is also an option
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student
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Re: Getting rid of Financial Engines

Post by student » Wed Jan 04, 2017 10:46 am

One other question. What do you mean by Fidelity refuses to get involved? Are they even refusing to stop Financial Engines to make further changes to your account? This doesn't seem logical.

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Re: Getting rid of Financial Engines

Post by ved » Wed Jan 04, 2017 10:47 am

Fidelity will not get involved, as they are not a party to the agreement between your (ex)employer, FE and your spouse.

FE has 2 options - a self-managed option - where they will provide their recommendations on how you need to allocate the funds to match your risk profile. The second option is for them to manage it, for a fee - which is what seems to be happening here.

In my 401k, I got the call from FE (several years ago), and I agreed to them managing it. I understood that as they would be calling me periodically to discuss their recommendations, and I would have to agree to implement those recommendations. In all fairness, they called and left voice mails a couple times saying that they would like to discuss the recommendations. Me being lazy/ busy did not return their call. And lo and behold, they implemented the recommendation. I got a little pissed, called them and cancelled the FE managed service. Lost a few dollars, as part of the fee for them managing it for a month (and that fee comes from the 401k funds). Then I re-allocated the funds as per my AA.

I am sure FE has a record that on so-and-so day their rep John Smith called your spouse, and confirmed with the spouse that the spouse agreed to FE managing the 401k. It's their word against your spouse's.

I would call FE and tell them to stop managing it for me. Think of it as a Lesson Learned - you/ your spouse need to understand what you are agreeing to.

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peregrine
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Re: Getting rid of Financial Engines

Post by peregrine » Wed Jan 04, 2017 10:55 am

I do not know how much Financial Engines wants to charge us to make them go away. Student does have a good point that from our own personal perspective it might be more efficient time wise to pay them off. We do feel that to pay Financial Engines off encourages this behavior, which we regard an unethical. From that perspective we would like to avoid doing so. This is a large account and if my husband threatens to move it elsewhere Fidelity might take more notice. We had not thought of complaining to the state attorney general. We will look into it.

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Re: Getting rid of Financial Engines

Post by Jack FFR1846 » Wed Jan 04, 2017 10:57 am

Ah....an OLD 401k. Easy solution. Roll this over to a rollover IRA at Vanguard. Make sure you let Fidelity know that you're doing this because they wouldn't help you to rid your account of this predatory leech. Fidelity really, really hates losing accounts and pays pretty well to get people to bring money to them (I'm a Fidelity customer and have moved money there numerous times to collect more bonus money). If they don't want to be involved, so be it.

Alternatively, Schwab and TDAmeritrade have great ETFs and will give you money to move to them and they don't have daily notices on their website that their call volume is too much for them to handle.
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Re: Getting rid of Financial Engines

Post by Rainmaker41 » Wed Jan 04, 2017 11:05 am

Ouch.

I'm no expert, but it seems to me you should consider decisive action that gets around the problem, rather than trying to fight these FE characters.

FE has control over the Old 401k. Fine. Rollover all assets of the Old 401k to either the New 401k or an IRA wherever you please. That way, you aren't picking a fight with crooks that is causing stress and pain. FE can still have control over the Old 401k; it will just have $0 in assets for them to screw with.

For good measure, mail certified letters to all parties concerned stating that the Old 401k account holder is terminating any relationship with FE effective immediately
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peregrine
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Re: Getting rid of Financial Engines

Post by peregrine » Wed Jan 04, 2017 11:07 am

The comments of ved helped me understand a little of what is going on. Apparently, there is something in their agreement that says that if they try to contact you and fail that they have the right to make the changes they recommend. If my husband had known this was going to be the case, he never would have agreed to it.

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peregrine
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Re: Getting rid of Financial Engines

Post by peregrine » Wed Jan 04, 2017 11:13 am

My husband's current employer's 401(k) will not accept the funds from the former employer's 401(k). The only option to get rid of the Fidelity account is to roll it over into an IRA. If he does this, he can no longer make tax free backdoor Roth contributions.

ved
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Re: Getting rid of Financial Engines

Post by ved » Wed Jan 04, 2017 11:27 am

OP,

Call FE and tell them to not manage the 401k for you. (Well, your spouse has to call them, as it's his account and not yours). Ask him to record that. Get the rep's name and ID#, and tell him/her that you are going to make a note of this conversation (with the date/ time stamp).

Then, watch the account - log in a few times over the next few months. See, if there's any re-allocation of funds.

Since I told them not to mess with my account (several years ago), they have not touched it.

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Re: Getting rid of Financial Engines

Post by Katietsu » Wed Jan 04, 2017 11:38 am

I too have an old 401k that has access to Financial Engines. There is a free version where you go online, answer questions and get a recommended asset allocation. It is then up to you to move the money into the recommended funds should you choose to follow the advice. There is also a paid version where FE reallocates your monies for you and you have to do nothing after the initial set up.

I have used the free service and found it helpful. There was about a year or two after it was first offered that I would get solicitations for the paid service every few months. However, in my opinion, both the fact that I would be paying for it and that they would have control of my account were clearly stated. I will say that the initial information that we received had information for both the free product and the paid product. So, if you looked at it quickly you might have misunderstood the offerings. However, I would not consider anything they did to be a scam. The fees and the fact that they would be trading for you was presented in plain English. The HR dept associated with this 401k in my case has always been very proactive in protecting participants and I think they would have dropped FE had they been doing anything inappropriate.

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Re: Getting rid of Financial Engines

Post by Pajamas » Wed Jan 04, 2017 11:41 am

Can they access the account to make trades if you change the password and don't tell them what it is?

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Re: Getting rid of Financial Engines

Post by ruralavalon » Wed Jan 04, 2017 11:46 am

ved wrote:OP,

Call FE and tell them to not manage the 401k for you. (Well, your spouse has to call them, as it's his account and not yours). Ask him to record that. Get the rep's name and ID#, and tell him/her that you are going to make a note of this conversation (with the date/ time stamp).

Then, watch the account - log in a few times over the next few months. See, if there's any re-allocation of funds.

Since I told them not to mess with my account (several years ago), they have not touched it.
Do as ved suggests, pay the Financial Engines' fee if you must. Don't leave the old Fidelity 401k with its low expenses just because of this mix up, don't shoot yourself in the foot.
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ved
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Re: Getting rid of Financial Engines

Post by ved » Wed Jan 04, 2017 11:50 am

Katietsu wrote:I too have an old 401k that has access to Financial Engines. There is a free version where you go online, answer questions and get a recommended asset allocation. It is then up to you to move the money into the recommended funds should you choose to follow the advice. There is also a paid version where FE reallocates your monies for you and you have to do nothing after the initial set up.

I have used the free service and found it helpful. There was about a year or two after it was first offered that I would get solicitations for the paid service every few months. However, in my opinion, both the fact that I would be paying for it and that they would have control of my account were clearly stated. I will say that the initial information that we received had information for both the free product and the paid product. So, if you looked at it quickly you might have misunderstood the offerings. However, I would not consider anything they did to be a scam. The fees and the fact that they would be trading for you was presented in plain English. The HR dept associated with this 401k in my case has always been very proactive in protecting participants and I think they would have dropped FE had they been doing anything inappropriate.
I second this completely. I also remember getting packages in mail that described this, along with the associated fee % for them to manage it. I don't think FE is doing any nefarious activities. They are selling their service, and if the user agrees to their service, they are providing that service and charging for it (based on published fee schedule).
Pajamas wrote:Can they access the account to make trades if you change the password and don't tell them what it is?
The employer gives FE access to the accounts - they don't ask you for your password.

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Re: Getting rid of Financial Engines

Post by Impromptu » Wed Jan 04, 2017 1:52 pm

If you have some sort of self employment income you may want to check out Schwab's individual 401(k). Free. And great ETFs.
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Re: Getting rid of Financial Engines

Post by LadyGeek » Wed Jan 04, 2017 7:38 pm

I removed a few off-topic posts and a reply which were derailing the thread. As a reminder, see: General Etiquette
We expect this forum to be a place where people can feel comfortable asking questions and where debates and discussions are conducted in civil tones.
Please state your concerns in a factual (not accusatory) manner.

This thread is now in the Personal Finance (Not Investing) (unwanted financial transactions).
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Re: Getting rid of Financial Engines

Post by Mudpuppy » Wed Jan 04, 2017 7:44 pm

Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.

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Re: Getting rid of Financial Engines

Post by *3!4!/5! » Wed Jan 04, 2017 7:52 pm

This is fraud. I don't know who you should report it to, but I hope you don't let them get away with it. Obviously, you also want to minimize the damage and further risk. Having a hostile party with access and control over your account is a very scary and dangerous situation indeed.

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Re: Getting rid of Financial Engines

Post by *3!4!/5! » Wed Jan 04, 2017 7:57 pm

Mudpuppy wrote:Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.
There was no "agreement" initially, and at no time was there "agreement" not under duress.

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Re: Getting rid of Financial Engines

Post by Mudpuppy » Wed Jan 04, 2017 8:06 pm

*3!4!/5! wrote:
Mudpuppy wrote:Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.
There was no "agreement" initially, and at no time was there "agreement" not under duress.
Being confused about the nature of the services before agreeing to the services is not the same as agreeing under duress and it does not nullify the agreement. Learning how to harden oneself against the sales tactics of these sort of businesses is part of investment and financial learning.

These sorts of businesses will always be circling. Better to pay a small fee now and learn the lesson to default to saying "no" to such businesses in the future.

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Re: Getting rid of Financial Engines

Post by FIREchief » Wed Jan 04, 2017 8:16 pm

I hate FE. My megacorp's 401k included this "feature" as well, but I never utilized it. The most annoying part of their process to me was that they would send mailings providing a high level view of my financial situation with various suggestions about changes I should consider. That sure wasn't something I wanted getting mixed into my neighbor's mail. :annoyed

The managed service they were trying to sell back at megacorp was, IIRC, 0.5% AUM fee for their active management. If that's what the OP "signed up" for, were talking about 12.5 basis points across all account holdings for 3 months. That certainly would not sit well with many here, since we take pride in reducing ERs by such amounts wherever possible.
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Re: Getting rid of Financial Engines

Post by *3!4!/5! » Wed Jan 04, 2017 8:19 pm

Mudpuppy wrote:
*3!4!/5! wrote:
Mudpuppy wrote:Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.
There was no "agreement" initially, and at no time was there "agreement" not under duress.
Being confused about the nature of the services before agreeing to the services is not the same as agreeing under duress and it does not nullify the agreement. Learning how to harden oneself against the sales tactics of these sort of businesses is part of investment and financial learning.

These sorts of businesses will always be circling. Better to pay a small fee now and learn the lesson to default to saying "no" to such businesses in the future.
But your version of events is completely different to the OPs. I don't understand why you would make your own version. These kinds of mischaracterizations really help the fraudsters.

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Re: Getting rid of Financial Engines

Post by Mudpuppy » Wed Jan 04, 2017 9:00 pm

*3!4!/5! wrote:
Mudpuppy wrote:
*3!4!/5! wrote:
Mudpuppy wrote:Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.
There was no "agreement" initially, and at no time was there "agreement" not under duress.
Being confused about the nature of the services before agreeing to the services is not the same as agreeing under duress and it does not nullify the agreement. Learning how to harden oneself against the sales tactics of these sort of businesses is part of investment and financial learning.

These sorts of businesses will always be circling. Better to pay a small fee now and learn the lesson to default to saying "no" to such businesses in the future.
But your version of events is completely different to the OPs. I don't understand why you would make your own version. These kinds of mischaracterizations really help the fraudsters.
What mischaracterization is there in saying the OP and her husband should take this event as a life lesson and learn to say "no" by default to these sorts of companies? The OP said her husband agreed to the service without understanding what he was agreeing to. There will always be companies circling the financial waters seeking people who default to saying "yes" without understanding what they are agreeing to. Don't be that person.

Yeah, the OP could try to fight it, but at what cost financially and emotionally? It will likely be easier to pay the fee, cut them off from the account, and walk away with a lesson learned and a story to tell. Not everything needs to be a battle. Sometimes walking away is the better option.

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Re: Getting rid of Financial Engines

Post by ved » Wed Jan 04, 2017 9:10 pm

Mudpuppy wrote:
*3!4!/5! wrote:
Mudpuppy wrote:
*3!4!/5! wrote:
Mudpuppy wrote:Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.
There was no "agreement" initially, and at no time was there "agreement" not under duress.
Being confused about the nature of the services before agreeing to the services is not the same as agreeing under duress and it does not nullify the agreement. Learning how to harden oneself against the sales tactics of these sort of businesses is part of investment and financial learning.

These sorts of businesses will always be circling. Better to pay a small fee now and learn the lesson to default to saying "no" to such businesses in the future.
But your version of events is completely different to the OPs. I don't understand why you would make your own version. These kinds of mischaracterizations really help the fraudsters.
What mischaracterization is there in saying the OP and her husband should take this event as a life lesson and learn to say "no" by default to these sorts of companies? The OP said her husband agreed to the service without understanding what he was agreeing to. There will always be companies circling the financial waters seeking people who default to saying "yes" without understanding what they are agreeing to. Don't be that person.

Yeah, the OP could try to fight it, but at what cost financially and emotionally? It will likely be easier to pay the fee, cut them off from the account, and walk away with a lesson learned and a story to tell. Not everything needs to be a battle. Sometimes walking away is the better option.
+1

There was likely no fraud committed. See above at my post on my experience with FE. Were they aggressive? Probably. But, they sent info packages, associated fees, and called me several times. But, I was lazy/ did not completely understand what I was agreeing to. So, lesson learned, and no permanent damage done. I re-shuffled the funds to my liking, and because it's in 401k no tax implications.

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Re: Getting rid of Financial Engines

Post by Whakamole » Wed Jan 04, 2017 9:19 pm

Mudpuppy wrote: What mischaracterization is there in saying the OP and her husband should take this event as a life lesson and learn to say "no" by default to these sorts of companies? The OP said her husband agreed to the service without understanding what he was agreeing to. There will always be companies circling the financial waters seeking people who default to saying "yes" without understanding what they are agreeing to. Don't be that person.

Yeah, the OP could try to fight it, but at what cost financially and emotionally? It will likely be easier to pay the fee, cut them off from the account, and walk away with a lesson learned and a story to tell. Not everything needs to be a battle. Sometimes walking away is the better option.
The OP says:
This situation started when someone from Financial Engines told my husband he had signed up for the financial advisory service. My husband has no recollection of signing up for this service. He was informed that if he quit the service he would be charged for the small amount of time he had the service but if he signed up for the 3 month free trial he would not be charged anything.
This to me sounds like fraud. "You signed up? Don't remember? We'll charge you unless you sign up for our 'free trial' and then we'll start trading in your account."

I agree someone needs to be taught a lesson, that's Financial Engines. And Fidelity for blowing off OP. The mere threat to pull an account may get Fidelity to take these sorts of complaints (you know this isn't the first) a bit more seriously, and it would certainly result in this complaint getting escalated beyond normal support to customer retention who usually has a bit more power in these kinds of situations.

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Re: Getting rid of Financial Engines

Post by *3!4!/5! » Wed Jan 04, 2017 9:21 pm

Mudpuppy wrote:
*3!4!/5! wrote:
Mudpuppy wrote:
*3!4!/5! wrote:
Mudpuppy wrote:Pay the fee to terminate FE's services and consider it a lesson in knowing what one agrees to before agreeing to anything.
There was no "agreement" initially, and at no time was there "agreement" not under duress.
Being confused about the nature of the services before agreeing to the services is not the same as agreeing under duress and it does not nullify the agreement. Learning how to harden oneself against the sales tactics of these sort of businesses is part of investment and financial learning.

These sorts of businesses will always be circling. Better to pay a small fee now and learn the lesson to default to saying "no" to such businesses in the future.
But your version of events is completely different to the OPs. I don't understand why you would make your own version. These kinds of mischaracterizations really help the fraudsters.
What mischaracterization is there in saying the OP and her husband should take this event as a life lesson and learn to say "no" by default to these sorts of companies? The OP said her husband agreed to the service without understanding what he was agreeing to. There will always be companies circling the financial waters seeking people who default to saying "yes" without understanding what they are agreeing to. Don't be that person.

Yeah, the OP could try to fight it, but at what cost financially and emotionally? It will likely be easier to pay the fee, cut them off from the account, and walk away with a lesson learned and a story to tell. Not everything needs to be a battle. Sometimes walking away is the better option.
What you are describing is completely different to what the OP describes. It's just like the Wells Fargo fake account scandal. The situation starts with the victim being signed up for some "account" or "service" without their knowledge or consent. When the victim later tries to somehow disentangle themselves from the situation, then nothing they do should be construed as an "agreement" not under duress.

It's a classic modus operandus where the perpetrator unilaterally attacks the victim, and then when the victim tries to defend themselves from the situation, the perpetrator traps the victim by convincing complicit observers that they are merely entering into an agreement.

Don't be complicit observers.

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Re: Getting rid of Financial Engines

Post by ved » Wed Jan 04, 2017 9:34 pm

Whakamole wrote:
I agree someone needs to be taught a lesson, that's Financial Engines. And Fidelity for blowing off OP. The mere threat to pull an account may get Fidelity to take these sorts of complaints (you know this isn't the first) a bit more seriously, and it would certainly result in this complaint getting escalated beyond normal support to customer retention who usually has a bit more power in these kinds of situations.
Fidelity is the plan administrator. They don't have a say on who will have the authority to access the accounts. The employer contracted with FE to provide this service to the employees/participants. If OP wants to complain, she should complain to the employer.

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Re: Getting rid of Financial Engines

Post by LadyGeek » Thu Jan 05, 2017 4:35 pm

The points about Wells Fargo and fraud have been made more than once, let's move on.
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Re: Getting rid of Financial Engines

Post by NotWhoYouThink » Thu Jan 05, 2017 4:52 pm

We are hearing the story from the spouse of an account holder who was not paying much attention. If someone called me and said I'd signed up for a service and would have to pay to cancel, I'd raise holy heck right then, not agree to a 3 month trial. I suspect something is missing from this story that the spouse doesn't know about, because the account holder didn't notice it or mention it.

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Re: Getting rid of Financial Engines

Post by davidkw » Thu Jan 05, 2017 6:17 pm

Call up and try and get on the news with the consumer reporter at the news station where you live. Bad press really gets people moving.
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Re: Getting rid of Financial Engines

Post by afan » Thu Jan 05, 2017 6:52 pm

Call Fe and ask to speak to a compliance officer. They will try to put you off. That is fine. You just want to ask "So you are refusing to connect me to a compliance officer?"

Take careful notes of the conversation, then send a complaint letter to FE, your state authorities and FINRA. It may not help, but you can also post online reviews and contact the BBB. With luck, FE may decide that letting you go is easier than fighting.

Do they have anything signed by you authorizing them to make changes to your account? If so, then you may be stuck. If not, then push back hard. In either case revoke whatever permission they claim to have. Do it on the phone immediately and follow up with a letter, including proof of mailing and delivery.

But do it now. Writing letters is more hassle than phone calls, but the longer you wait the more money they may grab.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

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Index Fan
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Re: Getting rid of Financial Engines

Post by Index Fan » Thu Jan 05, 2017 7:24 pm

Never, ever, agree to anything a shark (financial business) offers to you. The fine print hides a lot even if it sounds like it is free and with no consequences.
"Optimum est pati quod emendare non possis." | -Seneca

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Re: Getting rid of Financial Engines

Post by inbox788 » Thu Jan 05, 2017 7:57 pm

peregrine wrote:I do not know how much Financial Engines wants to charge us to make them go away. Student does have a good point that from our own personal perspective it might be more efficient time wise to pay them off. We do feel that to pay Financial Engines off encourages this behavior, which we regard an unethical. From that perspective we would like to avoid doing so. This is a large account and if my husband threatens to move it elsewhere Fidelity might take more notice. We had not thought of complaining to the state attorney general. We will look into it.
Financial Engines isn't the worst actor out there. Ask them about their fees. When and what exactly occurred? If this happened a month or two ago, you might just sit it out till the 3 month period ends and end the relationship then. What were your funds and allocations before and what did they switch you into? Did you do better or worse by their action? Not a whole lot has happened in the last month. Two months ago had a modest move, and depending on how much they messed with your allocation, you might have lost or gained something to argue about. Either way, there's little you should expect from them, and if it turns out they increased the equity risk, you might actually be ahead. You can change the allocation without discounting the relationship and being hit with cancellation fees. Calculate what is going to cost you more, cancellation fees or AUM fees. Neither should be all that much to make a big deal over.

Consider it a lesson learned, and understand what you're agreeing to when dealing with this business and any other business for that matter.

FWIW, I've done some free self-serve calculations with Financial Engines, and the overall recommendations haven't been bad. They have recommended strange ways of getting to the same type of allocation (i.e. combining target date funds with lifestyle funds and large cap funds), and the EF might have been a tiny bit more, but overall I think it was to hit the desired percentage AA that their algorithm used. I increased my equity AA by a few percentage, and it sometimes switched to a different lot of funds to use.

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Re: Getting rid of Financial Engines

Post by afan » Fri Jan 06, 2017 9:50 am

Interesting. An old employer had Financial Engines as a tool to calculate projected retirement assets and income. I did not agree to them doing anything, but filled out the forms to get their estimates. They were comically optimistic. Had me with enormous asset growth. I tried to get answers as to what assumptions they were using and ran into dead ends. Concluded it was worthless. Free, and no ability to trade my account, but worthless.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

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Re: Getting rid of Financial Engines

Post by student » Fri Jan 06, 2017 10:08 am

afan wrote:Interesting. An old employer had Financial Engines as a tool to calculate projected retirement assets and income. I did not agree to them doing anything, but filled out the forms to get their estimates. They were comically optimistic. Had me with enormous asset growth. I tried to get answers as to what assumptions they were using and ran into dead ends. Concluded it was worthless. Free, and no ability to trade my account, but worthless.
They use monte carlo simulation and I can see their explanation and assumption in the corresponding tab. They give multiple scenarios. I only pay attention to the one that is significant below average. I agree that it is not worth it if it is not free. The analysis that they gave is similar to others such as the one at Fidelity.

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Re: Getting rid of Financial Engines

Post by afan » Fri Jan 06, 2017 10:55 am

Maybe they have updated the presentation to give some more information. When I ran it they did not even say it was Monte Carlo, let alone what inputs. If they have revised it, it could be useful now.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama

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Re: Getting rid of Financial Engines

Post by student » Fri Jan 06, 2017 11:07 am

afan wrote:Maybe they have updated the presentation to give some more information. When I ran it they did not even say it was Monte Carlo, let alone what inputs. If they have revised it, it could be useful now.
As far as I can remember, they always mentioned monte carlo, this and Bill Sharpe were the reasons that I signed up when they was first established. (It was free for a few years and then I paid for a few years.) I remember that had catchy graphic "showing" the simulations. What I am not certain is whether it was mentioned prominently on its website or that I have read it in an article. For example, here are a couple of old articles: http://articles.baltimoresun.com/2000-1 ... -variables and http://www.wsj.com/articles/SB956783022421992832 If you have an account at Vanguard with at least $50,000 invested in Vanguard funds, you can use Financial Engines for free. There is a link to it on your Vanguard account page.

Edit: Added two links.

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