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Meet the "anti-technology" technology advisor

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So often when we think of advisors utilizing technology, we think of the gadgets and gizmos they carry around and use in presentations with clients. While those are important, we’ve told that story before. In Joel Johnson, managing partner at Johnson Brunetti, we found an advisor who uses new technology and systems behind the scenes — so when he meets face-to-face with clients, the focus is on that person across the table and doesn’t get lost or overwhelmed by spreadsheets and Monte Carlo simulations.

Johnson’s business model is based on the tenets of simplicity and efficiency, and we recently had the opportunity to talk with him and gain insights on what has made him the anti-technology technology advisor.

Daniel Williams: Simplicity, efficiency — how did these become core ideas, core values for you and your practice?

Joel Johnson: When I started this firm with Nancy Brunetti, who has since retired, we wanted to set it up so we could serve families like we were raised in, which are average families. Although we have some very wealthy clients, we’re not one of those firms that has decided we’re only going to service the ultra-wealthy. And because of that, we tend to attract a number of clients from all different kinds of backgrounds. We realized early on that we need to keep things fairly simple as far as the way we speak to clients and the way we educate them. Also in the way we provide solutions and the way we communicate the solutions and strategies we’re using need to be easy to understand.

DW: Does speaking in too much jargon play a role in communication or miscommunication?

JJ: Jargon is a huge problem in our industry, and we’ve tried to be everything opposite of that. There are so many people out there working with real high-end firms that don’t understand what they own, and they feel like they’re going to talk to a chemist or some other scientist when they meet with their advisor.

DW: So simplicity is a key?

JJ: Definitely. Simplicity is in the way we communicate. It’s also in the way we run the firm behind the scenes, where we want to make sure that every process we do have we simplified it down to the simplest form so that we get to the end result without too much complexity and therefore, we can afford to deliver that to average families.

If we’re highly technical in everything we do, now all of a sudden we can only serve the wealthy because we’ve got to have very large accounts, and that’s just not who we wanted to be as a firm. We wanted to be a firm that can serve everybody, that can afford to serve all the households out there. So simplicity is not only important in our communication with clients and what we do, it’s also the way we set up things behind the scenes at the office for us to function.

DW: Do you have an example of something you’re doing that may be technical or complex behind the scenes, but once it’s presented to the client it really connects or resonates with them?

JJ: One example is the way we present our financial plans and proposals to clients. Before we present to our clients, our proposals have all kinds of technical analyses going on by myself and by the other team advisors to decide if we’re going to use annuity products, or which annuity products to use. We do a fair amount of managed money, a significant amount of managed money and so behind the scenes we’re using portfolio building tools, Morningstar and a tool called HiddenLevers to build those portfolios. 

But when we have that discussion with a client, we use a very simple one-page diagram. We call it our one-page plan that just shows the client where they are today and where we suggest they move and it’s just a very simple conversation.

joel johnson

DW: That’s good to hear. When I talk with advisors, I’m always channeling my parents as a potential client, wondering if they would understand what this advisor is talking about.

JJ: Exactly. That’s why we don’t get into illustrations and technicalities and Monte Carlo analysis on stocks and bonds and what the market could do. We just have a conversation as if I were talking to my mom and dad. We use words like, “reduce risk,” and the “rollercoaster ride of the market.” We want to reduce a little bit of that, but at the same time you need exposure of the market, because we know that over your lifetime the cost of living is going to go up so we have to own some assets that appreciate with inflation.

DW: So tell me, when did the light bulb go off as far as making this process simple for clients?

JJ: For me it really evolved over time. I got my securities license in 1989, and I was just on the stockbroker side of things. But in 1993, I added life insurance to the business and I was working with young families.

I was a young person. My wife and I had just had our first child and so my peer group was my potential clients. You know, visiting folks in the evening, at the kitchen table, making sure they had the right life insurance and disability insurance, and maybe they were saving some money for college.

Around that time, I started listening to Million Dollar Round Table people who had a gift for presenting things in a very simple way. Then, I was around other people in the life insurance business that were not that way. They would communicate with the clients and I would actually sit in on some of the client meetings and watch the reasons some of the clients would start to go blank after a while. It was usually because they wouldn’t understand what was being talked about.

DW: So you saw a gap in the way different advisors were communicating?

JJ: Yes. At that point I really clicked with the people that were the master communicators, and the things that the master communicators all have in common are the ability to use words to paint pictures, the ability to bring something extremely complex down to tremendously simple terms so that the person they were trying to help could make a decision based on what is right for them and not some super technical analysis. And I just really gravitated towards that.

As I began to grow as an advisor and added some staff, I’ve come to admire people that can communicate a message that satisfies the technically-oriented process, but at the same time satisfies the person that’s not technically oriented — that just needs some help and needs to be motivated to do the right thing for themselves.

DW: How do you get everyone on your team to buy in?

JJ: It’s been an evolution, and we train our guys that way today. We have to un-train advisors if they’ve come from other firms because most people don’t want to know all those beta and alpha and sharp ratios and all those things that we get so excited about in this business. It’s like, when a dentist puts a filling in my tooth, I don’t really care what the chemical compound is. I just want the tooth to be better.

DW: I’m curious about this one-sheet template that you use with clients. How are you able to communicate with them about their retirement plans based on one sheet of paper?

JJ: So on that one sheet, it’s very simple. It lists, in simple terms, the client’s needs, and then we use that for a discussion template. It’s really not a financial plan from a CFP standpoint, but it’s a diagram, it’s a roadmap for a discussion.

DW: How does the one-sheet process work with a client? Is there anything you can walk me through?

JJ: Due to compliance, I don’t want to get too specific with it, but I’ll give you a hypothetical. So, if we looked at the sheet of paper, you’d see your different accounts, your current income and your income that you’re going to have from guaranteed sources for retirement. As we review it, we’d see there’s about a $2,000 a month shortfall.

So one of the first things we want to help you do is let’s figure out exactly where we’re going to satisfy that $2,000 a month shortfall. In this example, we’d see this old 401(k) you have, with $327,000 in it. If we roll that over into an account where it’s properly managed for the next five years, and we get a reasonable rate of return on it, that one account out of all of these across the top of the page, could satisfy your future income shortfall.

That’s kind of an example of where the questions are hitting and then we’ll talk about some specifics. And that’s exactly how we communicate with clients; that’s it. It’s not technical. It’s just very simple. We’re talking about what they’ve told us their needs are and how to satisfy or cover those needs so they can feel good about their finances in retirement.

DW: You’ve mentioned that you utilize technology to make things easier for your clients. But what about advisors who are not techies? How can they utilize technology where it’s simple and efficient for them and isn’t scary to jump out there and do things differently?

JJ: There are two things advisors can do. One is, if they’re concerned that technology is going to pass them by in their business, hire younger people and team up with younger people. Don’t try to learn it yourself. I’m 53 and I look at the way my 18-year-old, who is going to go to school for computer science, thinks and the way he operates and learns, and I don’t know if there’s a way to rewire my brain.

So, the key is bring in young people and team up with young people that know what they’re doing. If you don’t have people in-house, then hire an outside firm to handle the technology side of the business.

Advisors have to adapt one way or the other. But for that one advisor with no staff people, I don’t know that they can continue that way and be very relevant unless they’re just serving a very small group of clients. There’s nothing wrong with that, but for us, we want to stay relevant and I’ve got to hire people or partner with people that know what they’re doing.  

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