Two of wealth management technology giant Envestnet’s platforms experienced operational issues significant enough to prompt advisors to speak out over the last two weeks.
First, the RIA portfolio management and rebalancing platform Envestnet | Tamarac was down for hours on April 21. According to an advisor from a firm managing assets in excess of $1 billion, the outage lasted most of the day.
In a statement, Envestnet admitted to the platform's problems. "A limited number of advisors experienced a Tamarac issue last Friday, which was resolved by Monday and is isolated to Tamarac only.”
Then, a few days later, a large update to the venerable goals-based financial planning application MoneyGuidePro prompted advisors to compare notes and commiserate on Twitter about errors they were seeing from the software.
Bob Veres, publisher of the Inside Information service for financial planners, and a frequent industry speaker, sent an email to readers warning them of issues with MoneyGuidePro.
Veres and others reported seeing differing results between MoneyGuide’s Monte Carlo simulation meter and outputs even when nothing had been changed.
“Other inaccuracies that have been reported: the out-of-pocket costs in the healthcare module are inexplicably zeroed out in the reports, and the stock option module produced inconsistent results in the net worth statement—even if you take a restricted stock or options out of the inputs,” wrote Veres.
He pointed out another issue was that the marginal tax rate is showing zero when you look at the “what if” worksheet, which in turn prevents advisors from accurately predicting a client’s future marginal tax rate when modeling strategies for Roth conversions, among other issues.
In a statement, Envestnet acknowledged some users experienced issues with a "generational release" of MoneyGuidePro.
“Every 2-3 years when MoneyGuide issues a generational release we execute them in a very thoughtful and considerate way, to a limited number of clients, so that we can identify and respond to any items that require resolution in a short period of time—typically a day or less,” Envestnet Group President of Financial Planning Rose Palazzo said in a statement.
“Upon going live a small number of those customers (approximately 1% of total users) experienced issues," Palazzo said. "With any release of this size, we do anticipate items to arise, which is why we roll out the release in this way. At this point the majority of the issues that have been surfaced have been fixed and the MoneyGuide Support Team continues to communicate with our clients to ensure every item is identified and is resolved.”
Tens of thousands of advisors have access to MoneyGuidePro software, from small single-proprietor practices to large wealth management firms (for example, Edward Jones announced in March 2022 that its 19,000 advisors would gain access over the course of the year).
According to the firm, 3,100 independent RIAs with $2 trillion in assets use some part of the Envestnet platform, which provides an integrated ecosystem of technology ranging from client acquisition and onboarding to financial planning, portfolio management, account aggregation and data intelligence and other areas.
