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Ed Johnson

The right investment

by Barry Teater / Photography by Richard Quindrey

If you have a 401(k) retirement plan through your employer, you can thank Ed Johnson.

It was his Pennsylvania-based consulting firm, The Johnson Companies, that devised the savings instrument in the late 1970s, seizing on changes in section 401(k) of the federal tax code.

After one of its clients rejected the 401(k) plan as too new and novel, The Johnson Companies offered it to its own employees, becoming the first in the country to do so. The move elicited news coverage from The Wall Street Journal and The New York Times, and prompted the industry publication Pension and Investment to dub Ed Johnson "the Godfather" of the 401(k).

"I'm proud of my associate who came up with it and my other associates who designed and installed the 401(k) plan," Johnson recalls modestly. "We had to sell it. We worked with the Treasury Department to make sure it was right."

We've both had cancer, we're both survivors.

The 401(k) allows employees to contribute part of their pre-tax income to a retirement account— usually with matching contributions from their employer—and to defer paying income taxes on the savings and earnings until withdrawal. Today, about half a million companies provide 401(k) plans to about 60 million employees, who have a collective retirement balance of about $3 trillion.

Helping millions of Americans save for retirement would be a sufficient legacy for most people, but over the last six decades Ed Johnson and his wife, Cindy, have helped scores of other people by contributing their time, talent, passion and money to a litany of civic, educational, religious and scientific causes, including The Jackson Laboratory.

As a Jackson trustee from 1996 to 2006 and chair of the Development Committee, Ed helped the Laboratory develop a fundraising strategy and establish formal planned giving and charitable gift annuity programs. He and Cindy have made numerous financial gifts to the organization, hosted fundraising events, and persuaded other philanthropists to join the Laboratory's network of supporters, The National Council.

"Together, the two of them have supported the Laboratory because they understand the critical difference it's making worldwide," says Joanne Bean, the Laboratory's senior director of Development. "Ed's legacy has been to help initiate more planned giving among Laboratory trustees and other donors. He's been our real champion."

Cindy Johnson

The Laboratory honored the Johnsons' contributions in July 2010 by presenting them with the Philanthropy Award at its annual National Council dinner.

"I'm interested in The Jackson Laboratory for many good reasons," says Ed. "It has a great mission. It's very well managed. It's hard not to want to help." Echoes Cindy: "It's an exciting place, and the scientists are excited about what they're doing. You can't help but being swept up in the enthusiasm of the work."

The Johnsons were introduced to the Laboratory by Cindy's nephew, Paul Lemley, about 20 years ago. Lemley, a microbiologist, had attended a postdoctoral seminar at the Laboratory, and afterward "talked nonstop and was just enthused about the program, the Laboratory and what they were doing," Cindy recalls. "That piqued our interest."

The Laboratory was a relative latecomer to the Johnsons' thick portfolio of charitable causes. Their philanthropy as a couple began when the Pennsylvania natives graduated from college and were married in 1952, and Ed began building The Johnson Companies, a benefits, compensation consulting and insurance brokerage firm, at age 22.

Ed was active in the Civil Rights movement and in the early 1960s worked with two black churches and two white churches in Newtown, Pa., to refurbish an impoverished neighborhood and smooth racial relations. The volunteers he mobilized raised enough money to build decent houses where shacks with no indoor plumbing once stood.

"I think it was one of the most important things he's done," Cindy says proudly.

It's hard not to want to help.

The Johnsons faced their own personal challenges when cancer intruded in their lives. Cindy's cancer required a leg amputation in the 1970s—"a slight inconvenience," she says ironically—but has long been cured. Ed's cancer is still active after 20 years of treatments but is manageable, he says.

"We've both had cancer, we're both survivors and that's about it," Ed says matter of factly.

After building The Johnson Companies to 415 employees with offices throughout the East, the Johnsons sold the firm and retired in 1991. Today they live in a continuing care retirement community in Newtown, and spend summers at their home in Blue Hill, Maine.

The Johnsons have been lifelong supporters of their alma mater, Gettysburg College, and are also deeply involved with the Presbyterian Church. When they aren't working on church activities, charitable causes or visiting with their two children and three grown grandchildren, their days are filled largely with reading. Ed enjoys history, existential philosophy, economics and current events. Cindy leans more toward fiction. Ed is on the board of the Lincoln Prize of Gettysburg College, which awards prizes annually to authors of exceptional new books about the Civil War era.

The Johnsons also enjoy playing bridge, Cindy competitively.

"My wife is an excellent bridge player," Ed says. "I'm just a bridge player."