Meet an Advisor: Jorie Johnson

Evan Harp: When and how did your practice began?

Jorie Johnson: I was working in corporate America, in investment banking in Midtown New York, and I was frustrated with the corporate structure.

I have a very entrepreneurial spirit, so I went back to school to get my CFP and I fully embraced the fiduciary fee-only approach to planning. I was searching for a firm that was like-minded — and this was 20 years ago. There weren’t many out there who are doing fee-only fiduciary planning. And of the minimum subset that was out there, many were not hiring, as a lot of it was independent advisors.

So, I started my own firm as opposed to going down the commission path, which I did not want to do. I didn’t want to sell. I didn’t want to have to convince any of my clients to buy a product for me to get paid. It was very important to me to maintain my fiduciary status. And I thought that fee-only was a much better approach to doing this than fee-based or commission-based.

Harp: What is your investment philosophy?

Johnson: Our philosophy is passive wins in the long haul for equities. On the fixed income side, we do a combination of passive and active management. That has really helped these past few years with the Fed actively raising interest rates to be short duration on the fixed income side. But overall, I would say our investment approach is … very boring!  It’s not sexy. Our models buy and hold at the lowest cost with the broadest net possible. We use a lot of ETFs for this purpose.

Harp: I think that’s a really smart answer. What’s the biggest obstacle you had to overcome, and how did you do it?

Johnson: I started the firm in 2004. The biggest obstacle was marketing — getting exposure. There weren’t many fee-only firms back then, and there were even fewer female CFPs or fiduciary advisors. So the challenge was in just getting the word out. Still, to this day, marketing is one of the biggest obstacles. Fee-only fiduciary independent advisors do not have the marketing budget that national larger firms possess. The biggest obstacle was educating people that firms like mine existed, and then getting them to understand the differences between hiring an independent firm versus a firm that was aligned with producing products.

Harp: What’s something happening in the market right now that not enough people are paying attention to?

Johnson: I have two answers to that. One is that I think consumers are spending too much time worrying about spending and debt and not enough about saving for the future. We see a lot of people who come in who are undersaving and overspending. Because it gives them instant gratification when they spend today as opposed to saving for something that’s feels very esoteric, that’s 10 years off, or 20 years or 30 years — however far off retirement age might be for them. It’s getting people to focus on the fact that investing is long term, and that the benefits come by being in the market for a long period of time.

The other thing I would say is the flip side of that. There are people who think they can outsmart the market by paying attention to the media and trying to decide what the Fed is going to do this year, or what the Fed might do next quarter. They try to trade around that to optimize it or time the market. It just it doesn’t work in the long run. I would say that what’s happening in the market and being reported by the media is almost like financial garbage that’s just making everybody in U.S. work themselves up and they just can’t see the forest for the trees and stay invested in and keep their vision on the horizon.

Evan Harp: Our final question is, who is another financial advisor that inspires you and why?

Johnson: That’s a hard one. I have a lot of friends in the industry. I am inspired by advisors who maintain their independence and maintain their fiduciary duty to clients, even if that means the advice they give their clients is not financially in the advisor’s or the practice’s best interest — which is what they’re supposed to do. When I see people actually doing that, it warms my heart that there are still good people out there in the world delivering objective financial advice.

I would say that the National Association of Personal Financial Advisors has really helped a lot because they focus on fee-only independent advisors. They have a high bar to join the organization. You can’t just pay a fee and join. You have to actually apply and do a financial plan and they have to vet you. I like that they’re keeping the standards high.

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