Jeff Montgomery of Montgomery Financial ServicesSTRATEGIES FOR SUCCESS



Montgomery Financial Services founder Jeff Montgomery shares insights into his practice in a one-on-one with CSM

What was the hardest lesson you learned about the investment industry?

I think the hardest lesson I learned is that the industry at large doesn’t have the best interest of the client at heart. The big brokerage firms and the financial advisors who work for them are really in the business of selling products. Chances are those products are good for the advisors but may not be good for the client.

That may all change with the new DOL fiduciary ruling earlier this year. What really helps the client is an investment strategy that does not rely on predictions to be successful. Prudent investing and discipline really pay off in the long run. Chasing what’s hot or the latest and greatest investing gimmick leads investors to make very poor decisions, which can have devastating results to their long-term success. 

What are the biggest mistakes you see people make when it comes to their investments?

The biggest mistake is when they make changes to their portfolios or their investment strategies based on either fear or greed during short-term market conditions. This could look like the investor jumping out of the market during a bad cycle or chasing too aggressively after an investment because it had done well recently. The behavior that follows fear and greed typically leads to performance losses that can be hard to recover from.

Sticking with a prudent strategy and owning a highly diversified stock portfolio with high-quality fixed income allows the investor to rebalance by buying low in tough market conditions. 

What is the most important thing for people to know about the investing process?

The good news is, you don’t have to know everything, as long as you know the right things. We are bombarded with investing information on a daily basis. So much so, it’s hard to ignore it all. Most of this information is useless and harmful to the investor’s state of mind. I also think people don’t realize that investing is really a lifelong process. I don’t know many people that hit some magical age of, let’s say, 75 or 80 and withdraw all of their money and put it under their mattress. 

It may sound daunting, but true success comes from a lifetime of investing and sticking to a prudent investment strategy in good times and bad. 

How do you coach investors to stay disciplined with their investment strategies?

This is achieved through consistent education and community. One of the most rewarding things about my career is getting together with all of my clients, in a classroom setting, and teaching a class on a regular basis. It connects us in a way that I don’t think many other investment firms do. By bringing them together to learn and understand their investment strategies, we are building a support structure for sticking with the program. 

Does your investment strategy work for everyone?

My approach works for people who are willing to take the time to learn and be coachable. It’s amazing to me at times, but the reality is that not everyone is willing to learn what prudent investing really is. Some look for that magical solution that will grow wealth quickly.

From my experience, I have yet to find that. Prudent, evidence-based investing takes time. My approach works for people willing to invest for the long-term who want to be involved and understand the process. 

Describe the characteristics you look for in your clients.

I work with people who are motivated to achieve their financial goals and are willing to let me help them. It doesn’t matter how much money they have; it’s all about their willingness to admit that they may not know what they don’t know. That sounds crazy, but it’s not easy to admit that you may not know everything.

Not everyone is coachable and willing to understand their investment strategy in order to get the results they want. 


What is the first step in getting started in this process?

The first step is to understand that there may be a better way to invest your money. To find an approach that is based on academic evidence, not speculation.

Letting go of preconceived notions and a willingness to explore a different approach is a great start. The second step is to do a complete inventory of your current investment situation — truly analyze your investment strategy, what you have done in the past, what has worked, what hasn’t, and determine what results you need to achieve.

Being a successful investor is something anyone can do with the right tools, strategies and knowledge. 


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