The Robin Hood of fees

FeeX, a free, web-based service, helps users reduce management fees for their pension and savings plans.

David Weisz (photo credit: SAHAR ROTT)
David Weisz
(photo credit: SAHAR ROTT)
‘We wanted to build something that would help a lot of people and change their lives,” says David Weisz, co-founder and chief of products at FeeX, a startup that styles itself as the Robin Hood of fees.
Launched in May 2013, FeeX is a free, web-based service that enables users to redeem some of the exorbitant and unjustified costs they might unwittingly have been paying to the financial institutions that manage their pension plans, life insurance, etc.
The concept was inspired by Uri Levine, one of the founders of the GPS software Waze and now FeeX co-founder and chairman, who discovered that he had been paying an annual fee of 2 percent to the financial institution responsible for losing about 30% of his savings. Levine contacted the company to ask how it could justify the charge when it had so obviously mismanaged his money.
The company responded by returning all management fees for the relevant period and reducing his annual fee to 1%.
“That was the aha moment,” says Weisz. “You can get your fees reduced simply by asking. But the problem is that not only do people not ask, they don’t know what to ask for.”
According to Weisz, we, the unsuspecting public, could be paying management fees amounting to one-third of our total pension savings.
“We found that people, even those in the finance business, don’t know where their money is, how much they’re being charged, how it is divided among different products, what each product is. Nobody talks about it because they don’t want to be thought stupid, but the differences between what people pay for the same financial product is outrageous. The financial institutions take advantage of their customers’ ignorance. Our job is to bring transparency to a market where fees are well hidden.”
To use FeeX, users upload details of their financial statement to the FeeX website, where it is compared to the statements of other users with the same financial characteristics, such as type of policy, level of monthly deposit, etc. A freier (sucker) meter indicates to what degree the user has been exploited in relation to others.
Explains FeeX general manager Eyran Blumberg, “Once the statement has been analyzed, FeeX shows the user a lower fee paid by at least 15% of users with a similar policy and financial characteristics. For example, the user might have been paying an annual fee of 2% while others have been paying 0.8%.
At a click of a button, the user can then send a customized email to the financial institution involved, pointing out that he or she is paying more than others for the same product and asking for a meaningful discount. This email kickstarts the negotiation process.”
At that point, he continues, “the financial institution responds, there’s an exchange of emails and the user gets a reduction. We are collecting examples of how customer representatives respond to our users, and building a script that other users can use in their negotiations.”
Although the reductions might initially appear minimal, even a difference of a few tenths of a percent can result in an increase of tens to thousands of shekels in savings in a pension fund due to compound interest over many long years of saving. Indeed, fees that appear to be small and insignificant can represent a third – and sometimes more – of overall savings.
Blumberg demonstrates a sample policy in which the user, following negotiations with his financial institution, would reap an additional sum of NIS 102,000 or NIS 500 a month on retirement.
He explains that FeeX is also dedicated to increasing its users’ knowledge about their policies and alerting them to any anomalies. “For example, here is a policy where the user is paying for a wife and kids despite the fact that he is a bachelor. Over 60% of bachelors are paying for insurance that they don’t need.”
According to Blumberg, the financial institutions are beginning to feel the impact of FeeX on their business.
“They understand that we have created trust with our users, and they’re offering us joint ventures, special promotions, etc.,” he says. “But for us, the objectivity we bring to this venture is so important. If we make a deal with one of the institutions, we immediately lose our objectivity.”
Another affected player in this field is the insurance agent, the man in the middle who sells the policy to the customer. States Blumberg, “There is a compensation system whereby the more the customer is charged, the more the agent earns. Therefore, when we empower people to reduce their fees, the agent is also affected.”
Adds Weisz, “Most people think that the insurance agent is on their side, but they don’t know that the agent can earn about 50% of the fee that they pay to the financial institution.”
FeeX has currently reached 45,000 users, from the self-employed and teachers to government and hi-tech workers, and manages almost NIS 2 billion worth of assets.
FeeX recently launched its service on the American market, where, according to Weisz, the incidence of hidden and excessive fees is even worse than in Israel. By default, Israeli- based users are automatically taken to the Israeli site when typing FeeX into their browsers, but Israeli citizens with American individual retirement accounts (IRAs) can also access the American site from Israel.
The Israeli site is currently only in Hebrew, but there are plans to make it available in English by the end of the year. Still, users with limited Hebrew- reading skills are not neglected, as user Angela Ben Gur from Jerusalem was delighted to discover.
Recounts Ben Gur, “After registering with FeeX, I received some written material from them, but I couldn’t understand what they wanted me to do, so I called and one of their reps helped me upload my keren hishtalmut [continuing education fund] statement. The upshot is that my agent, who I never knew existed until now, responded to my email, and without any argument undertook to reduce one fee from 6% to 4% and another from .5% to .25%, both retroactive from January 2014.
The agent also said he’d try to get the reduced fees retroactive from July 2011. The guy from FeeX was very supportive, and I’m very impressed with the service.”
Blumberg sums up that “in general, FeeX offers three key elements: First, it’s a free service for private consumers.
Second, we are truly objective; we’re not selling anything, we’re not subsidized by one of the big guys, we’re truly the Robin Hood of fees.
And third, anonymity, because the user can use our system without disclosing personal information.”
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Israeli website:
American website:
The writer has worked for over 20 years in hi-tech. If you have a question about any of the products featured in this column or have developed a product you’d like to share, contact