WBS: Episode 15 – Foundations Platform

The Johnston Group recently launched its Foundations client service platform that focuses exclusively on young professionals and young families.  There is tremendous value in smart financial decision-making from a younger stage of life and this program seeks to develop a strong foundation for long-term financial success.  The Foundations platform aims to build good savings and investing habits and also guides individuals through important life milestones such as marriage, children and career development.  Technology has completely changed the financial services landscape and younger individuals need to embrace a proactive approach to smart financial decision-making at an earlier stage in their lives.    

    

 
 

The Whiteboard Series is a continuous exploration and discussion across a wide range of personal finance topics. Through a series of drawings, interviews and explanations, we hope to educate and simplify important financial planning principles. 



Video Transcript

On today’s Whiteboard Series I want to talk about our Foundations platform and the value of smart financial decision-making at a younger age.  Not surprisingly, there’s a strong co-relation between someone’s age and the amount of money they’ve accumulated in the form of savings and investments.  Everyone’s got their own situation and it’s certainly not a straight linear relationship, but the slope generally looks like this.  As you get older, perhaps make more money and have had more years of saving under your belt, your total assets tend to rise with your age.  

For years, the financial services industry was reserved for this side of the spectrum.  There’s no exact profile, but the floor to start engaging someone for financial planning and investment management services was generally someone with at least $1M and around the age of 40.  This is when people started focusing on some financial planning and investment strategy and trying to put a plan together.  Relatively more established individuals, individuals with fairly significant amounts of money, that were maybe approaching retirement or had some complex planning requirements later in life.   

 Technology has completely changed the landscape of the financial services industry.  Which is a great thing.  Now there’s so much more access to education, information and savings & investing platforms, that you can start engaging in financial planning at much younger stages in life.

The irony of this perception that financial planning is only for older individuals or individuals with lots of money, is that younger people have the most to gain by good planning at younger ages since they have so much runway ahead of them to capitalize on smart financial decision-making. 

A few years ago, we created a new platform we call our Foundations platform, which is specifically designed for young professionals and young families.  We’ve had tremendous success and have gotten a lot of good feedback as we help people build a strong FOUNDATION for long-term financial success. 

So, some of the focus on this platform:

  • Someone in their early mid-20s with some employer benefit questions or looking to start saving/investing outside their 401k

  • Individuals looking to purchase a home for the first time

  • Recently married individuals or people starting to have kids, as they look at issues like life insurance, basic estate documents, college savings plans for their kids

  • As people go through their 30s, approach 40s, making good money for the first time, and they’re really looking to start saving and investing

 There’s rarely anything overly complex at these stages of life, but it’s so important to get organized and start developing good habits at younger ages.  The two biggest advantages these people have in investing are TIME and COMPOUNDING INTEREST.  The long-term upside of good financial decision-making at these stages is huge for long-term financial success.