Approach 2 temp - Keating Wealth

Our Approach

We forcefully advocate an investment philosophy focused on the few variables that actually govern successful long‐term financial outcomes. Instead of confusing complexity, we provide precise, evidence‐based, actionable answers—bringing you the peace of mind that comes from knowing you are on track to achieve your financial goals.

What We Believe

Trust. The relationship between a client and a financial adviser must be built on a bedrock of mutual trust. We earn our clients’ trust by telling them the absolute truth at all times. This is the only way to build an enduring relationship that benefits both parties.

Planning. A customized financial plan is a key element in our relationship with each client. The plan establishes investment portfolio goals and enables us to measure progress toward those goals.

Purchasing power. Preserving the dollar value of a portfolio is never an adequate goal, because inflation constantly erodes that value. With 3% inflation a year, the cost of living doubles every 25 years, and investors who merely preserve their principal will lose half their purchasing power over that period. The goal must be to preserve and grow purchasing power.

Equities. Over time, equities—not bonds—have been the best way to preserve and grow purchasing power. Since 1926, equities have delivered a 7% real (inflation‐adjusted) return for large‐company stocks—triple the 2% real return for bonds.

Volatility. Equities are more volatile than bonds, and the bumpy ride is the reason for the higher returns. But we don’t equate equity volatility with risk. Volatility is a short‐term disturbance, whereas the long‐term returns from equities are enduring. Equities are a good investment because they go down temporarily and up permanently.

Growth. Volatility is the norm in the equity market. Since 1970, intrayear declines have averaged 14%. Roughly 1 out of 7 years, there’s a bear market decline of 20% or more. Nonetheless, the equity market is now more than 41 times higher than it was in 1970, and dividends have increased by a factor of 15. Inflation has trimmed these gains, but not by much; consumer prices are now about 7 times higher.

Behavior. The real risk for equity investors is not volatility; it’s their emotional response to volatility. All of us have an innate tendency to interpret large temporary declines in the market as the beginning of the end. And when we panic, we flee. Investor behavior—not investment performance—drives the financial outcomes experienced by most investors.

Patience. For decades, countless experts have tried—without success—to predict or time the markets. We conclude that it cannot be done. To capture 100% of the long‐term return of equities, investors must be in the market at all times. This means experiencing 100% of the short‐term volatility. Since there is no effective way to buy or sell stocks in response to market or world events, we devote no time or effort to analyzing these
events. Our advice is unchanging: Whatever may be happening in the world, we counsel clients to patiently hold the portfolio that offers them the best chance of reaching their financial goals.

Value of advice. Over the years of our relationship with you, our behavioral advice against panic selling in falling markets and our discipline in helping you stick to a well‐constructed Financial Plan will be worth multiples of our fee.

Index funds. We believe equity index funds should be the core holding for all our clients because these funds are broadly diversified, low‐cost, and tax‐efficient. Over every cycle, equity index funds have consistently outperformed the vast majority of actively managed mutual funds.

Limited Number of Clients

Message From Tim Keating

Personal Service

Just as a plane needs a flight plan to safely reach its destination, business owners, professionals, executives and their families need comprehensive financial plans to successfully complete their multidecade financial journeys.

I launched Keating Wealth Management to help successful people navigate the economic implications of life transitions and simplify their lives. I made the deliberate decision to establish a two-person firm, with myself as the sole financial adviser and a capable colleague to manage all operational matters.

Because of my direct and complete involvement in each aspect of every client relationship, it soon became clear that I could share my singular expertise with only a limited number of families.

Metaphorically, we think of our firm as a small but well-appointed ship, with 50 staterooms reserved for valued members of our community. By necessity, we must select those members with care, ensuring that every household we serve is compatible with our criteria, enabling maximum value for all. Our relationships are deeply personal and lasting.

Mutual Fit

Most of our clients are business owners, corporate executives and capital markets professionals. With my extensive Wall Street and Silicon Valley experience, I am uniquely qualified to advise on situations ranging from multimillion-dollar business deals to multigenerational wealth planning.

Free from all conflicts, I am an objective voice that clients can trust unconditionally. If you are seeking high-touch service from a knowledgeable, trustworthy, genuinely independent adviser, we might be a good match.

Regardless of whether you have ever worked with a financial adviser, our “19 Questions to Ask a Financial Adviser,” populated with our responses, will help you cut through the clutter and gain clarity about where we stand on essential issues.

Relationship Size

The minimum household account size for new relationships is $2 million. This requirement, combined with our cap on the number of families we serve, enables us to devote the necessary time and effort to each client’s financial planning and investment management needs. We will consider exceptions for young business owners and professionals who are likely to match our client community financial profile over time, subject to a $1,500 per month minimum fee.

What You Get

As a Keating Wealth Management client, you’ll benefit from comprehensive financial planning geared to your individual situation. Your personalized Financial Plan is just one component of the full suite of advisory services we provide.

Data sources: Morningstar and J.P. Morgan Asset Management (as of December 31, 2020).