What is Goals-Based Investing?

Updated: Original Post January 15, 2015

A New Year means new resolutions, as people look to ways they can live better, happier and more productive lives. Right up there with getting healthier, one of the most popular resolutions centers on finances. This is not surprising given that, according to AARP, the median retirement account balance is $3,000 for working-age households. As Balentine CEO Robert Balentine wrote in an op-ed for the Atlanta Business Chronicle, “we have spent too much, saved too little and lived beyond our means. Simply put, we are a financially illiterate nation.”

While iPhone apps, SMART goals (Specific, Measurable, Attainable, Realistic and Timely) and other tools help with keeping resolutions, research shows that between 62-88% of resolutions fail. How can one attempt to avoid this grim reality?

At Balentine, we use a goals-based approach to wealth management to help our clients reach their long-term financial objectives. Goals-based investing means our focus is not on relative returns or what the S&P is doing this minute, hour or day. Instead it is about helping our clients understand what their goals are and building an investment policy statement around those objectives – whether they are to send grandchildren to college, to fund philanthropic organizations, to create a retirement nest egg or a combination of the three. We then factor in time horizon, spending retirements, portfolio contributions and behavioral biases to create a portfolio tailored to each client’s unique needs.

As a goals-based wealth manager, this also means that Balentine’s job is to help clients stay disciplined and committed to their long-term investment objectives, even when it feels uncomfortable. Though it may seem contrarian to whatever CNBC or Jim Cramer is saying on a particular day, a thoughtful, repeatable investment process that considers historical context helps overcome those emotional biases to which we are all subject.

Perhaps next to their health, people worry about their money more than anything else, which explains the onslaught of resolutions surrounding these topics every January. At Balentine, we believe that our goals-based approach to wealth management has the ability to help clients not only create goals but to maintain them long term.

Contact Us

Looking for guidance managing your wealth? Balentine is committed to providing the education and advice our clients need to realize their goals.