United States

Profile: Financial Engines Inc (FNGN.OQ)

FNGN.OQ on NASDAQ Stock Exchange Global Select Market

17 Feb 2017
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Financial Engines, Inc., incorporated on March 17, 2008, is a provider of independent, technology-enabled portfolio management services, investment advice and retirement income services to participants in employer-sponsored defined contribution plans, such as 401(k) plans. The Company offers personalized plans for saving, investing, and generating retirement income, as well as by providing assessments of retirement income needs and readiness. The Company uses its advice technology platform to provide its services to millions of retirement plan participants. Its target over three constituencies in the retirement plan market, including plan participants (employees of companies offering 401(k) plans), plan sponsors (employers offering 401(k) plans to their employees) and plan providers (companies providing administrative services to plan sponsors).

The Company provides personalized, unconflicted advice and management services to each individual's specific investment needs and goals. It offers various principal services, including Professional Management, which is a discretionary managed account service designed for plan participants who want personalized and professional portfolio management services, investment advice and retirement income services from an independent investment advisor without the conflicts of interest that can arise when an advisor offers products. With this service, it provides discretionary management of the participant's plan assets and makes investment decisions on behalf of the participant. In some cases, the Company provides this service by acting as a sub advisor to a plan provider acting as the investment manager to plan participants. Its Financial Engines Income+ is a feature of Professional Management that manages portfolios to generate income, and calculates and facilitates the potential payment of steady recurring payouts from those portfolios in retirement, for plans where Income+ is available; the Company also provides social security claiming guidance and retirement income planning. The Company also offers Income+, a feature of its Professional Management service that provides retirement income for 401(k) participants. The Company's Income+ provides discretionary portfolio management and provides participants with steady monthly payouts from their 401(k) accounts during retirement. Early in retirement, Income+ provides payouts from the 401(k) assets. With Income+, members can contact an investment advisor representative to start payouts, stop payouts, or make additional withdrawals from their 401(k) accounts so they have access to their savings as needed. With Income+, members receive retirement plans that show how the Company plans to allocate their investments, as well as quarterly retirement updates that show any changes the Company has made to their investment allocations.

The Company's Online Advice is an Internet-based non-discretionary investment advisory service designed for plan participants who manage their portfolios directly and want to receive personalized investment advice, including Social Security claiming guidance for participants at plans where Income+ is available. With this service, plan participants may elect to follow the online advice without delegating investment decision-making and trading authority to it, making this a nondiscretionary service. This Internet-based service includes interactive access to simulation and portfolio optimization technologies through the Company's Advice Engines. Plan participants see a forecast that shows how likely they are to reach their desired retirement goals, get recommendations on which investments to buy or sell and simulate how their portfolios might perform under a range of economic scenarios. They can also explore different levels of investment risk, savings amounts and retirement horizons, as well as get tax-efficient advice on accounts other than their 401(k) accounts.

The Online Advice service offers investment advice on the fund options available in a 401(k) plan and can also offer advice on the investment options available in other non-plan sponsored accounts. The Online Advice service is integrated with single sign-on to the plan provider's 401(k) Website, which enables data pre-population and, typically, the ability to initiate transactions directly from the Online Advice service. In addition, its Online Advice users have the opportunity to access one of its Investment Advisor Representatives by phone if they wish. Its Advice Engines consist of two main components: a Simulation Engine and an Optimization Engine. Its Monte Carlo Simulation Engine provides plan participants with a view of their retirement investments. The Simulation Engine helps plan participants reach informed decisions about the appropriate level of risk, savings and time horizon to achieve financial goals. It uses its Optimization Engine to construct personalized portfolios. Its services also include individual retirement account (IRA) Management, which includes the Income+ capability, for members and their spouses on custodial platforms with Charles Schwab and TD Ameritrade.

The Company's Retirement Evaluation is a retirement readiness assessment, which is provided to plan participants upon rollout and periodically thereafter, together with Professional Management enrollment materials. Retirement Evaluations highlight specific risks in a plan participant's retirement account, provides guidance on how to reduce those risks and introduce its services as a means of obtaining help in addressing these issues. Retirement Evaluations are based on data provided by the plan provider and in some cases, supplemental data provided by the plan sponsor, plan participant, or other data providers. Retirement Evaluations include an evaluation of how well the plan participant is investing and saving in the retirement plan. Specifically, the evaluation considers aspects of how the individual plan participant is using the 401(k) account, including investment decisions (risk, diversification and employer stock concentration) and contribution rate. It integrates personalized online assessments of certain types of investing risks into plan providers' Websites. This integration allows participants who log onto the provider Website to view personalized assessments of their portfolio online.

The Company's Social Security claiming guidance is available online and through registered investment advisor representatives and is offered for plans where Income+ is available. For retirement plan sponsors, its services are designed to develop employee satisfaction and reduce fiduciary and business risk by evaluating, disclosing and addressing investment and savings decisions by plan participants, and by providing an opportunity for lifetime payouts in retirement. For retirement plan providers, its services provide personalized, independent investment advice that can be a service for the plan sponsors.

The Company competes with Morningstar, GuidedChoice, ProManage, LLC, Fidelity, Bank of America Merrill Lynch, Vanguard, T. Rowe Price, Principal Funds, Wells Fargo Advantage, J.P. Morgan, Voya, Empower Retirement Funds, Prudential, AllianceBernstein, Charles Schwab and Morgan Stanley Smith Barney.

Company Address

Financial Engines Inc

1050 Enterprise Way Fl 3
SUNNYVALE   CA   94089-1411
P: +1408.4986000
F: +1408.4986010

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