If you manage your own investment portfolio, you’re not alone. Plenty of high-net-worth investors take pride in the DIY route and see success that should be commended. But here's what can get left out of the conversation: even the savviest investors miss advanced strategies that can have a huge impact on long-term wealth.
And when these strategies are missed—or worse, done incorrectly—the consequences can be costly. In this article, we'll explore key areas where do-it-yourself investing often breaks down, and why many investors eventually find it helpful to get a second opinion from a professional team.
Let’s look at the most often overlooked: tax efficiency, disciplined portfolio management, and behavioral discipline.
Taxes quietly eat away at returns. The good news: there are smart strategies to reduce that drag. The bad news? They’re not simple to execute on your own, and the best execute a multi-year approach that may require regular tax projections and evolution to the latest code to have maximum impact.
On paper, harvesting losses sounds straightforward. In reality, the rules (like avoiding wash sales) trip up DIY investors all the time. Do it wrong, and you lose the benefit—or worse, trigger unexpected taxes.
Most individuals don’t have the technology or bandwidth to monitor accounts daily, so opportunities often get missed. A professional setup can automate this process and reduce the chance of costly errors.
That’s the difference between an occasional tax break and a consistent source of added after-tax return, or in simpler terms the difference between only considering your next tax bill as opposed to your lifetime tax burden.
Most investors know about asset allocation. Far fewer optimize asset location, which is all about placing the right types of investments in the right type of accounts for maximum tax efficiency. For example:
This isn’t just a one-time decision. It requires ongoing coordination across taxable accounts, IRAs, 401(k)s, and Roth accounts, plus regular rebalancing as markets move.
It’s one thing to understand the concept—it’s another to coordinate across multiple accounts and keep it updated year after year. That’s where many DIY investors run into challenges.
High-net-worth investors are often generous with their portfolio growth but tend to choose the least tax-smart option: giving cash. Strategies like donating appreciated securities or using Donor-Advised Funds can dramatically reduce taxes. However, they require planning and execution most self-directed investors don’t have the bandwidth or deep tax knowledge to manage.
Many investors find it helpful to run these strategies by an advisor to make sure generosity aligns with both values and long-term plans.
Opportunities like Qualified Small Business Stock (Section 1202), mega backdoor Roth strategies, and estate planning tools (GRATs, ILITs, partnerships) are powerful for their ability to protect your hard-earned investments from unnecessary tax burdens—but they require coordination with CPAs and attorneys.
These strategies can be powerful, but they’re also where DIY often hits a wall. Coordinating with tax and legal professionals ensures nothing slips through the cracks.
Managing a portfolio is more than picking funds and hoping for the best. Without structure and discipline, a DIY-approach portfolio end up looking like a patchwork of ideas collected over the years.
Evidence shows that market timing doesn’t work. Yet DIY investors often can’t resist tinkering—pulling back when the stock market is scary or chasing returns when things are hot.
Advisors keep you anchored to a long-term allocation built for your goals, risk tolerance, and time horizon. That discipline is worth far more than trying to outguess the market.
Rebalancing enforces “buy low, sell high” discipline. But here’s the problem: most DIY investors either don’t rebalance, or they do it haphazardly.
Professional investment advisors use systematic processes—calendar-based, threshold-based, or both—to keep portfolios on track without emotion. At Plancorp, we rebalance our clients’ portfolios daily. For DIY investors, it’s worth asking: do you have the time and systems to do this consistently, even weekly?
High-net-worth investors often have access to alternatives like private equity, hedge funds, or real estate. But more isn’t always better. Without a fundamental framework, diversification turns into clutter, and you can easily find yourself diversified in the wrong way toward too many risky or non-strategic opportunities.
The challenge for DIY investors is separating what truly diversifies from what just adds noise or cost. Having a clear framework makes that distinction easier.
Executives and entrepreneurs who earn non-salary compensation often end up with too much wealth tied to one stock. DIY investors usually either hold on out of loyalty or sell without a strategy. Both choices create risk.
Advisors bring advanced solutions—exchange funds, selling strategies, or charitable planning—that balance risk and opportunity in ways DIY investors rarely implement correctly.
Even with perfect tax and allocation strategies, your own behavior can undo everything. That’s not an insult—it’s human nature.
When you’re managing millions of dollars, volatility feels personal. Fear of losing money or greed during booms can drive costly decisions.
Without an objective voice guiding your investment strategy, it’s easy to react to emotions instead of sticking to the plan.
How Advisors Add Discipline
That discipline is nearly impossible to maintain on your own. An advisor doesn’t just manage money—they manage behavior, which can be the biggest determinant of success.
The appeal of DIY investing is obvious: avoid fees and stay in control. But the hidden costs—missed tax opportunities, inconsistent execution, emotional mistakes—often dwarf any savings, to say nothing of the cost of your own time put into staying on top of markets, tax code, efficient vehicles and technology changes.
When investors do seek help, it’s usually for three reasons:
The question isn’t whether you can DIY—it’s whether you’re capturing the full potential of your wealth by doing it alone.
High-net-worth DIY investors are smart, resourceful, and capable. But even the best-intentioned investors often miss the advanced strategies that matter most: tax efficiency, disciplined allocation, and behavioral discipline.
These aren’t “do-it-yourself” moves. They’re areas where working with an advisor creates real, measurable value.
Even the most capable DIY investors can benefit from a second opinion. Sometimes it’s not about handing off control, but about making sure nothing important is being missed. If you’ve ever wondered what you don’t know you don’t know, it may be worth a conversation.