Financial Engines
FINANCIAL ENGINES® TO PROVIDE FINANCIAL GUIDANCE TO 650,000 SUNSHINE STATE EMPLOYEES
Florida to Embark on the Largest Conversion of a Retirement Plan in U.S. History Allowing Employees Choice of Plan Options
TALLAHASSEE, Fla and PALO ALTO, Calif., July 9, 2001 – Today, the Florida State Board of Administration (FSBA), the investment manager of the State of Florida's $100 billion pension plan, announced that Financial Engines' investment education and guidance will be an integral part of the State's transition from a traditional retirement system (offering only a defined benefits option) to one also offering a participant-directed plan (a defined contribution plan, also referred to as "PEORP"). Florida employees will have an opportunity to elect between the pension plan and the PEORP. Financial Engines will begin a rollout of its service in March 2002. This is a multi-year, multi-million dollar agreement.
Financial Engines' powerful simulation technology, with its customized service and communications materials, will help State employees to understand the implications of switching from a defined benefit to the PEORP. The service will forecast how an employee's retirement portfolio may fare in the newly created defined contribution plan. It will take factors such as risk and retirement age into account, allowing employees to see the potential outcomes.
"This shift in options offers an innovative benefit to our State's employees who are faced with a complex choice to make. We feel strongly that employees must understand the investment risk of either selection and be able to develop a specific strategy to define and meet their retirement goals," said Tom Herndon, Executive Director of the FSBA. "Financial Engines' customized interface will be easy to use. And its in-depth educational content is the best in the market and will arm state employees with the personalized tools they need."
Choosing Financial Engines as the Education Content Specialist was the result of an in-depth search by the State of Florida, which involved the experts of the FSBA, as well as many outside consultants, including Ennis Knupp & Associates.
In its recommendations to the FSBA, Ennis Knupp concluded that the Financial Engines package "reflects current best practices in the investment and financial disciplines, and the team has very solid credentials (led by the Nobel Prize winner, William Sharpe)...Financial Engines also has the best simulation technology to develop a broad range of future economic scenarios that illustrate how investment and other financial risk factors will affect retirement benefits under both the current DB plan and under PEORP for any specific participant situation."
"Financial Engines was founded on the tenets of outcome-based, long-term investing," said Bill Sharpe, Chairman and founder of Financial Engines "and we are delighted to be able to work with the State of Florida to help its hundreds of thousands of employees plan for their financial future."
About the Florida State Board of Administration
The Florida State Board of Administration is a team of people dedicated to providing exceptional investment, financial, and administrative services to members of the Florida Retirement System and state and local governments.
About Financial Engines
Financial Engines is a leading provider of investment advice services to the workplace and to financial institutions. Financial Engines enables employers, financial professionals and financialorganizations such as fund companies, brokerages and banks to offer consistent,high-quality, personalized investment advice on a cross-enterprise basis. Founded by Economics Nobel Laureate William F. Sharpe, Financial Engines works with its customers to help their clients make better investment decisions to meet their financial goals. Financial Engines was founded in 1996 and is located in Palo Alto, Calif.
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Financial Engines® is a registered trademark of Financial Engines, Inc. All other trademarks and service marks are the property of their respective owners. All advisory services are provided by Financial Engines Advisors LLC, a federally registered investment advisor.