Words: Damien Maltwood, Investment Director, Quilter Cheviot
In an age of YouTube tutorials, Reddit forums, and DIY investing apps, managing your own money has never seemed more accessible. With a few taps on your phone, you can buy stocks, rebalance your portfolio, or even dabble in cryptocurrency. But while the appeal of self-directed finance is strong (control, low fees and independence) the hidden costs of going it alone can quietly erode your financial well-being.
1. Emotional Decision-Making
One of the most underestimated costs of DIY money management is emotional bias. Fear and greed are powerful forces. When markets dip, panic selling can lock in losses. When markets soar, FOMO (fear of missing out) can lead to risky bets. A financial planner or investment manager acts as a buffer between your emotions and your money, helping you stay disciplined and focused on long-term goals.
2. Time is Money
Managing your own finances takes time—lots of it. Researching investments, tracking market trends, rebalancing portfolios, understanding tax implications, and staying up to date with changing regulations can feel like a full-time job. For most people, that time could be better spent earning income in their profession, enjoying life, or simply avoiding financial burnout. As an investment manager with over 25 years investment experience, I am always learning and using the knowledge I gain for the benefit of my clients.
3. Overconfidence and Knowledge Gaps
Many DIY investors overestimate their financial literacy. While you might understand the basics of investing, areas like estate planning, tax optimisation, insurance, and retirement income strategies require specialised knowledge. Mistakes in these areas can be costly and hard to reverse. A financial planner brings expertise and a holistic view that goes beyond picking stocks or funds.
4. Missed Opportunities
Without professional guidance, it’s easy to overlook strategies that could significantly improve your financial outcomes. Tax efficient investing, charitable giving strategies, and asset location are just a few examples. These aren’t typically covered in DIY investing apps or online forums, but they can make a big difference over time.
5. Lack of Accountability
When you manage your own money, there’s no one to challenge your assumptions or hold you accountable. A financial planner provides structure, regular check-ins, and a second opinion. They help you set realistic goals, track your progress, and adjust your plan as life changes. That accountability can be the difference between drifting financially and staying on course.
6. Hidden Fees and Poor Diversification
Ironically, many DIY investors who aim to save on advisor or investment manager fees end up paying more in hidden costs. These can include high expense ratios on mutual funds, unnecessary trading fees, or tax inefficiencies. Additionally, without a clear strategy, portfolios often become poorly diversified—overweight in certain sectors, underexposed to others, or too concentrated in individual stocks or just unbalanced due to movements over time.
7. Stress and Uncertainty
Money is one of the leading sources of stress for adults. Managing it alone can amplify that stress, especially during volatile markets or major life transitions like retirement, divorce, bereavement or job loss. An investment manager doesn’t just manage your money—they help manage your peace of mind. Knowing you have a plan and a professional in your corner can be invaluable.
Final Thoughts
There’s no shame in wanting to take control of your financial future. In fact, being engaged and informed is essential. But going it alone doesn’t always mean going it smart. The hidden costs of DIY money management—emotional decisions, missed opportunities, and time lost—can far outweigh the fees of hiring a professional.
A good financial planner doesn’t just help you grow your wealth—they help you protect it, optimize it, and align it with your life goals. In the end, the real question isn’t whether you can manage your money yourself. It’s whether doing so is truly the best investment of your time, energy, and future.
Investors should remember that the value of investments, and the income from them can go down as well as up. You may not recover what you invest. This commentary has been produced for information purposes only and is not intended to constitute financial advice. Investments referred to may not be suitable for all recipients.
Quilter Cheviot, Quilter Cheviot Investment Management and Quilter Cheviot International are trading names of Quilter Cheviot International Limited. Quilter Cheviot International Limited is registered in Jersey with number 128676, registered office at 3rd Floor, Windward House, La Route de la Liberation, St Helier, JE1 1QJ, Jersey and is regulated by the Jersey Financial Services Commission and as an approved Financial Services Provider by the Financial Sector Conduct Authority in South Africa.
