Edelman Financial Engines vs. Fidelity: which is right for you?
Edelman Financial Engines and Fidelity both offer financial advisory services, but they organize advice, portfolio management, fees, and advisor access differently.
Feature | Edelman Financial Engines | Fidelity |
|---|---|---|
Service type | Advisor-led wealth planning and investment management | Tiered financial advisory services |
Fees | 0.50% to 1.75%, negotiable above $25 million | 0.20% to 1.50%, depending on the program |
Minimum account size | Workplace IRA clients may need $10,000, legacy wrap minimum is $5,000 | Varies by service tier, wealth services range from $50,000 to $10 million |
Best for | Investors who want planning-led advice with a retirement and portfolio management focus | Investors who want a choice of digital, hybrid, advisor-led, or private wealth options |
Edelman Financial Engines vs. Fidelity: Key services
Edelman Financial Engines offers integrated planning and managed portfolios through a planner relationship. Fidelity serves investors who want a menu of advisory tiers and account options. Their services are organized differently.
Edelman Financial Engines:
- Financial planning: Personalized planning around goals, savings, investing, retirement, taxes, insurance needs, and estate considerations.
- Investment management: Advisor-led portfolio management using model or customized portfolios, typically built with mutual funds and ETFs, with ongoing monitoring, rebalancing, and reallocation.
- Retirement planning and income support: Retirement projections, workplace retirement account advice where available, and retirement income services.
- Tax planning guidance: Tax-aware planning and, where appropriate, tax-loss harvesting discussions.
- Estate planning guidance: Estate and legacy planning support, including coordination with outside attorneys where needed.
- Advanced portfolio options for eligible clients: Customized portfolios, SMAs, direct indexing, fixed income strategies, and selected alternative investments.
Fidelity:
- Fidelity Go: Automated investment management with professional oversight and coaching.
- Fidelity Managed FidFolios: Direct indexing with automated tax-loss harvesting and portfolio customization.
- Fidelity Wealth Services (FWS): Advisor-supported planning and discretionary portfolio management through Personalized Portfolios.
- Fidelity Wealth Management (FWM): Dedicated advisor support, comprehensive planning, and personalized investment strategy.
- Fidelity Strategic Disciplines (FSD): Separately managed account strategies for investors seeking more customized portfolio management.
- Fidelity Private Wealth Management: Advisor-led team support for complex wealth needs.
Edelman Financial Engines vs. Fidelity: Fees
Edelman Financial Engines and Fidelity both use asset-based pricing for advisor-led wealth management, but their fee structures differ.
Edelman Financial Engines uses a tiered wealth planning wrap fee schedule for many wealth planning clients:
Assets | Edelman Financial Engines annual fee |
|---|---|
First $400,000 | 1.75% |
Next $350,000 | 1.25% |
Next $250,000 | 1.00% |
Next $2 million | 0.75% |
Next $7 million | 0.60% |
Next $15 million | 0.50% |
$25 million+ | Negotiable |
Fidelity’s fees depend on the selected service:
- Fidelity Go: No advisory fee under $25,000; 0.35% at $25,000 or more.
- Fidelity Managed FidFolios: 0.40% or 0.70% annually.
- Fidelity Wealth Services (FWS): Tiered advisory fees range 0.50%–1.50%
- Fidelity Strategic Disciplines (FSD): 0.20%–1.04%, depending on strategy and assets.
- Fidelity Private Wealth Management (FPW): Fees follow the relevant FWS or FSD schedule, with higher service eligibility.
Key fee differences:
Fee category | Edelman Financial Engines | Fidelity |
|---|---|---|
Advisor-led fee | 0.50%–1.75%, negotiable above $25 million | 0.20%–1.50%, depending on program |
Digital / lower-cost advice | Online Advice fixed fee is $300 | $0–0.35% for Fidelity Go; 0.40% or 0.70% for Managed FidFolios |
Planning fee | Up to $10,000 may be waived | Not separately disclosed |
Edelman Financial Engines vs. Fidelity: Minimum account sizes
Edelman Financial Engines and Fidelity both disclose minimums, but they present them differently.
Edelman Financial Engines:
Edelman Financial Engines service/account | Minimum disclosed |
|---|---|
Wealth planning clients | No single fixed minimum disclosed |
Legacy EFS wrap fee household accounts | $5,000 |
Workplace IRA | $10,000 |
Personal Advisor | $225 quarterly |
Institutional clients | $500,000 |
Fidelity:
Service | Minimum |
|---|---|
Fidelity Go | $0 to open; $10 required for Fidelity to invest |
Fidelity Managed FidFolios | $5,000 |
Fidelity Wealth Services | $50,000 |
Fidelity Strategic Disciplines | $100,000–$200,000, depending on strategy |
Fidelity Private Wealth Management | $2 million managed through FWS and/or FSD and $10 million in investable assets |
Edelman Financial Engines vs. Fidelity: Pros and cons
Here is a look at the key pros and cons of both Edelman Financial Engines and Fidelity.
Pros of Edelman Financial Engines:
- Planning-led service: This helps readers connect investment management with retirement, tax, estate, and insurance guidance.
- Retirement-focused advice: The firm has a clear focus on retirement planning, workplace retirement accounts, and retirement income services.
- Hands-off portfolio implementation: Edelman can manage portfolios on a discretionary basis, including trade implementation, rebalancing, and allocation changes.
- Advanced options for eligible clients: Eligible clients may access customized portfolios, SMAs, direct indexing, fixed income strategies, and selected alternative investments.
Cons of Edelman Financial Engines:
- Higher starting advisory fee: The wealth planning wrap fee starts at 1.75% on the first $400,000, which may be high for smaller advisory accounts.
- Unclear wealth planning minimum: Its current wealth planning minimum depends on the model and may be reduced, increased, or waived.
- Wrap fee does not cover every cost: It does not include all fund, ETF, account, transfer, wire, alternative investment, or special transaction costs.
Pros of Fidelity:
- Multiple service levels: Investors can move from automated investing to planner access, dedicated advisor support, and private wealth services.
- Lower entry options: Fidelity Go and Managed FidFolios give smaller investors access to managed portfolios at lower minimums.
- Clear fee and minimum disclosures: Program costs and eligibility levels are easier to compare.
- Combination of planning and portfolio management: The advisory tiers integrate financial planning with discretionary investment management, providing clients with both strategic guidance and execution within a single program.
Cons of Fidelity:
- Program selection complexity: Clients need to compare several service models, minimums, and fee schedules.
- Higher-touch services require larger balances: Wealth management and private wealth management have much higher eligibility levels.
- Limited personalization for digital services: Fidelity Go has no human advisor support and offers only standardized portfolios.
- Additional program costs: Underlying investment expenses, SMA manager fees, and other account-level costs may apply.
Edelman Financial Engines vs. Fidelity: Technology and security
Both firms support digital access.
Edelman Financial Engines has its own EFE App. It also provides online access through tools, workplace access, and investment professionals. Its disclosures include monthly or quarterly custodian statements and quarterly portfolio reports. Clients can communicate by phone, mail, or email, with in-person meetings scheduled in advance.
Fidelity provides a dedicated app and digital account access. It supports account access, portfolio tracking, trading, transfers, planning tools, documents, alerts, and security settings. Client communication can include phone or video calls, a dedicated advisor, or an advisor-led wealth management team, depending on the service.
For asset custody, Edelman Financial Engines does not physically custody managed client assets. Clients use qualified custodians such as Schwab and Fidelity. Fidelity uses Fidelity-affiliated brokerage and custody entities.
For security, Edelman Financial Engines discloses technical, organizational, and physical safeguards. Fidelity discloses multi-factor authentication, encryption, 24/7 monitoring, and account activity alerts.
Final verdict: Edelman Financial Engines vs. Fidelity
Edelman Financial Engines and Fidelity both provide financial advisor services, but the service models differ.
Edelman Financial Engines uses a planning-led advisory model that includes managed portfolios, retirement planning, and ongoing access to a planner. Fidelity uses a tiered advisory model that includes automated investing, planner access, dedicated advisor support, and private wealth services.
Edelman’s fee schedule is based on a declining wrap fee structure, while Fidelity’s pricing varies by program.
Investors may choose Edelman Financial Engines if they want:
- A planner-led relationship
- A wrap fee advisory model
- Retirement-income and workplace retirement advisory support
Investors may choose Fidelity if they want:
- A wider range of advisory options, from robo advice to private wealth management.
- Lower starting minimums and more digital account tools.
- Digital access plus the option to move into a dedicated advisor or private wealth support.
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