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RetireOne CEO and co-founder David Stone
RetireOne CEO and co-founder David Stone

RetireOne Acquires Edelman Platform to Help RIAs Offer Fee-Only Annuities

The move will enable RetireOne to offer greater options for RIAs interested in commission-free insurance and annuities products.

EF Legacy Securities, a broker-dealer platform owned by Edelman Financial Engines, has been acquired by RetireOne in a bid to expand insurance and annuity back-office services for RIAs who are interested in transitioning from commission-based to fee-based annuities options, the platform announced today. CEO David Stone said the expanded platform will help RIAs interested in fee-only insurance options expand both flexibility and control over their accounts.

“Fee-only fiduciaries look to us as a partner who can empower them to provide holistic financial advice and plans that incorporate insurance, principal protection, lifetime income guarantees, and additional tax-deferred accumulation,” Stone said.

In April 2018, Hellman & Friedman purchased Financial Engines, the largest RIA in the country, for $3.02 billion, combining it with Edelman Financial Services, a mass-affulent RIA firm founded by Ric Edelman, introducing Edelman’s firm into the 401(k) industry (many small- to mid-size firms use Financial Engines to advise employees about retirement plans). RetireOne was founded in 2011 and works with approximately 900 RIAs, with more than $1 billion in retirement savings and income investments under advisement.

The combined Edelman Financial Engines is an extremely sizable firm, with $21.7 billion in managed assets for more than 35,000 U.S. clients, while Financial Engines’ software could be accessed by more than 10 million employees with more than $1 trillion in assets. According to Stone, the acquisition will help RetireOne develop additional business opportunities by making fee-only insurance options more accessible.

“We frequently speak with former registered reps who are now IARs of RIAs,” he said. “They’ve had to abandon hundreds of millions of dollars of client assets. With our help, these client assets may no longer be left behind.”

While annuities sales are primarily commissions-based, firms are innovating in an attempt to create new opportunities for RIAs interested in pursuing fee-only options. Digital retirement-focused startup Kindur offers a no-commission annuity product on its platform after having met with 40 insurance companies to find one who would build such a product, while DPL Financial Partners has acted as an intermediary between advisors and insurance companies to better detail how those companies can craft annuities products RIAs would sell. In a video interview earlier this year, DPL Founder and CEO David Lau said RIAs would be “power users” if annuities had been fee-based all along.


“There’s so much academic support for the benefits annuities provide in generating efficient income in retirement and providing emotional benefit to retirees who can live without worrying about the market. If you started that way, RIAs would be the largest distributor of annuities in the market, but because they’ve been commission-driven for so long, you’ve got a lot of institutional bias against the product,” he said. “So,while you see all the academic support for annuities, you see that because they haven’t fit the business model of the RIA, it can be a real challenge for an RIA to recommend an annuity for their clients.”

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