One step at a time for this advisor

McDonough’s approach to financial advice mirrors his approach to business. “Financial planning isn’t an event; it’s a process,” he says. “None of us is short-term focused. It’s the long-term focus over time.”

Today, McDonough, who holds both the certified financial planner and chartered financial consultant designations, has $50 million in assets under management (AUM) in his book, while the firm, now with three partners and six associates, has $150 million in AUM.

The numbers could be larger, McDonough admits, but dollar signs are not what drive this firm’s partners. “We’re not obsessed with increasing revenue,” McDonough says. “We’re focused on relationships.”

That approach represents a shift from the co-founders’ original vision. “Initially, we thought growth made a lot of sense,” McDonough says. “Now, we want to build a cohesive team. We are focused on having a synergistic group. We don’t want to get sidelined with [human resources] issues.”

McDonough’s book of business covers a wide range of demographic groups, income levels and life stages: men and women; the young and the old; professionals and business owners; families and single people; clients saving for retirement and retiree clients.

Building a niche clientele does not interest McDonough or his partners. However, McDonough adds, while the firm’s client base remains broad, it does have a “strong nucleus of clients among professionals and small businesses.

“The concept is to make a bigger splash because we have a bigger outreach,” McDonough continues. “We are generalists. We look at the global picture.”

The team, he notes, does have one significant advantage in dealing with business-owner clients: “We have incorporated as a company and as individuals. You set up structures that allow you to understand how other businesses operate.”

A native Nova Scotian, McDonough graduated from Queen’s University in 1992 with a degree in economics. Co-founding his own financial advisory firm was somewhat of a leap, he admits. McDonough’s father, Peter, is a well-known lawyer with one of Atlantic Canada’s largest firms; his mother, Alexa, is the former leader of the federal New Democratic Party. But when Justin McDonough finished his undergraduate degree at Queen’s, he wasn’t sure what career path to follow.

He was approached by London Life Insurance Co. to sell insurance, and the offer piqued his interest. An uncle recommended the firm for its training program, and McDonough signed on. He remained with London Life, working in Halifax, for nine years. Still, he says, “I was always cognizant that insurance couldn’t be the only element in planning.”

That realization and a growing desire to branch out led McDonough to start a firm with Matthews, a colleague at London Life, more than a decade ago. “We wanted more of a boutique operation,” McDonough says. “We wanted to brand ourselves. Our clients were receptive.”

Still, the move to independence was intimidating: “It was untreaded water. There was some risk even though it was well thought out. It was like buying your first house.”

Having a business partner helped to ease the anxiety and give the business greater stability. Matthews and McDonough had become familiar with each other’s style and approach to business while working together at London Life. “There was trust there already,” McDonough says.

That trust was bolstered when John Tompkins, now a partner, joined the team in 2003. Like his colleagues, Tompkins got his start with London Life and has more than 15 years’ experience in the industry.

McDonough’s approach has always been to concentrate on the client’s needs, not on the product offerings. In that regard, McDonough says, being a financial advisor gave him a sense of independence and his clients clearer insight into the services McDonough provides. “We do the global picture,” he says. “We don’t just peddle a product.”

Products should never be the focal point for a financial advisor, McDonough believes: “This is not the role of a salesperson. It is a consultant. We help people through the process.”

McDonough, who also has his elder planning counsellor designation, believes that financial advisors should practise what they preach. That means following such “motherhood” approaches to long-term financial stability as saving for the future and maintaining a sound financial balance. “We are advocates of leading by example,” McDonough says.

McDonough and his firm also have achieved steady growth by helping clients look past the immediacy of the market. “Because we try to get clients not to focus on issues beyond their control, we’ve retained clients,” he says. “We take a conservative approach. Change has to be a thoughtful and slow process.”

McDonough, 44, has worked hard to build his business. He also has worked hard to make sure business is not the central focus of his life. McDonough and his wife, Heather, have four children – two boys and two girls – all under age 13. McDonough strives to involve his children in both individual and team sports, and he coaches their baseball and basketball teams.

Being involved in sports is important for kids, McDonough says: “I believe it builds character and grace, and it [teaches you] how to lose.”

An avid athlete himself, McDonough is a former Canada Games tennis player who still plays competitively at the national level, where he is ranked among the top 10 in Nova Scotia among all age groups. He also plays squash competitively.

Another important component of the work/life balance equation is giving back to the community. McDonough, an active volunteer, is chairman of the board of Trade Centre Ltd., the largest conference facility in Nova Scotia, and is past president of the Alzheimer’s Society of Nova Scotia.

He also has served on the boards of Tennis Nova Scotia and the Holiday on the Harbour Charity Ball, which raises money for local children’s charities, among others.

Community and charitable work is an obligation, McDonough says: “It’s not just about yourself.”

Advice from an incrementalist

Building a financial advisory business requires lots of sweat equity and an individual approach, says Justin McDonough, co-founder of Matthews and McDonough Financial Planning Inc. of Halifax. Other attributes also are important. He offers the following advice:

– Surround yourself with good people – everyone from mentors to staff. There are lots of ups and downs in the first five years in business, McDonough says, and support is essential.

– Evolve over time. Slow growth enables you to retain control as you expand.

– Stay focused on your goals. It’s easy to get sidetracked, McDonough warns. Discipline is required.

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