Why Pay Someone To Manage Investments?

I run my own independent financial advisory business, and I offer two different flavors of services: financial planning and investment management. A lot of the posts I share here are more about the financial planning topics, like how to manage cash flow with an up & down income or how much money you should keep in a savings at all times, but today I want to talk about investment management. Specifically, why would someone want to pay another person, like me, for example, to manage their investments?

Here’s a little history lesson for context: in the earliest days of financial advice, it was essentially impossible for a person of any income or net worth to buy and sell their own investments. They literally had to have someone else do that for them, and financial advisors filled that role. They would help their clients choose investments (or choose for them), then buy and sell investments through a brokerage company. Often the advisor worked directly for the brokerage company, and nearly always they got paid a commission based on the investments they bought or sold for their clients.

So in the earliest days, a financial advisor was basically a gatekeeper for access to investment markets. You needed an advisor to do that job for you. A couple of important things to note: in those days, you could only buy or sell investments in what are called “even lots”, meaning multiples of 100 shares each time. So if you wanted to buy some Apple stock, for example, which is worth right around $260 per share as I'm writing this on 08 January 2026, you’d have to plop down at least $26,000 just to get your foot in the door. AND you’d also have to pay a hefty commission on top of that.

Which is all to say that working with a financial advisor and even having access to investment markets was mostly limited to very wealthy people.

These days, of course, technology has radically changed the nature of buying and selling investments. Anyone can do it from their smartphone, and usually with no sales fees at all. And you don’t need to trade in even lots of 100: you can buy just a single share of a company or mutual fund and, in many cases, you can buy fractional shares. So if you only have $10 to invest, you can still participate in the stock market. And with the rise of so-called robo-advisors around 15ish years ago, you can have access to well-diversified portfolios with sophisticated trading algorithms for a fraction of what you would pay a human advisor.

In other words, the role of investment advisor as gatekeeper is dead and gone. It’s obsolete. All of the barriers to participating in the public investing markets have been broken down, and now anyone can do what only the very wealthy could do 50 or 60ish years ago. It’s honestly really amazing.

So the question naturally arises: since the internet gives us so much access to information and anyone who wants to can learn how to invest and access the tools to do so with very low or no fees, why would you pay someone to do that job for you?

To take it even a step further, in certain online communities like the FIRE movement (which stands for Financial Independence, Retire Early) or so-called Bogleheads (named after Vanguard founder Jack Bogle), the idea of paying an advisor to manage your investments is not just viewed as unnecessary — it’s looked down upon, like you’re making a grave error if you give away your precious money to have someone do something that you could do yourself.

So here are the main arguments against hiring an investment manager, at least as I see them: 1) you could do it yourself, so you don’t literally need someone to do it for you; 2) you will save money by doing it yourself, and saving money is a good thing; and 3) investment management is an ongoing relationship, so you’re paying someone over and over to do the same job for you.

Those are all valid points, and I can’t say that I disagree with them. But I don’t think that’s the entire picture. I want to make two points to push back on those arguments. First, we pay people to do things that we could do ourselves all the fucking time. And that’s not a bad thing! Paying someone to do something you could do yourself is not some kind of moral failure. And secondly, the technical, tactical part of the job — the actual buying and selling or designing portfolios — that is not really where the most value is derived (at least not anymore). The real value in working with an investment advisor is that they can help you do something you know you should do, but don’t want to or — for whatever reason — are unable to do for yourself. It’s not about whether it’s possible for you to do it yourself; it’s about whether you are actually doing the right things.

When it comes to the first counterargument — that we pay people all the time for things we can do ourselves — I want to share an analogy. Stick with me for a minute.

My next door neighbor’s plot of land is about the same size as mine. We happen to own an electric lawn mower and I mow our lawn throughout the grass-growing season maybe once a week or every other week, and I’d say that it takes me less than an hour to do so.

My next door neighbor, on the other hand, pays a lawn care service to look after his lawn. I’m not sure how much he pays them, but let’s just say it’s $100 per month (which seems on the low side to me, but let's just stick with it). The new version of our lawn mower retails for under $200, so there’s no way that my neighbor is saving money by paying someone to mow his lawn. And I know for a fact that it would not take more than an hour a week to do that chore, because it takes me less than an hour per week to mow my lawn and it is basically the same size. If he bought a mower and did it himself, he would save at least $400 in the first year alone, then at least $600 per year for the life of the mower. It’s so much more economical for him to do it himself instead of paying a lawn service company.

So is my neighbor foolish for paying someone to do something he could do himself? Or paying someone to do the same job over and over? Absolutely not! We don’t all hold the same ideas about the virtue of manual labor or the best use of our time and money. It might be totally worth it to him to spend that money so he can do something else or avoid spending time on a chore he doesn’t like. That’s totally fine.

And by the way, we also spend money all the time on things we don’t actually need, like streaming entertainment. No one needs Netflix and HBO and Prime and AppleTV and Disney+ and a live sports package. No one needs that stuff, but people are happy to pay those fees over and over and over in perpetuity. And that’s totally ok. It’s all right to spend money on the things that you want if you can afford them.

So getting back to investment management, the point I want to make is that we spend money all the time on things that we could do ourselves. And we pay people to provide the same service to us over and over and over. So I call bullshit on the idea that paying someone to manage your investments is a bad thing simply because you could do it yourself and therefore save money. That’s just not really how we make decisions about almost anything, so why would it apply in just this one area of your life? It seems to me like a weird distinction to say that you can spend money on all kinds of goods and services and convenience, as long as you don’t spend money on having someone manage your investments.

So now the question is: if you can access all the information and tools necessary to manage your investments, do you actually want to? And, more importantly, will you actually do it? Those are not the same things.

And that brings us to the second point I want to make: the real value of investment management is not the knowledge I have or the sophisticated software that I use. The real value is that I can help you do something that you don’t want to, don’t like to, or find difficult to do for yourself.

When investment managers are pushed to justify their fees, they usually dive into all the tactical, technical benefits. For example, I have access to tools that make it easy to automate the rebalancing of your investment accounts so that you always have the right mix of stocks & bonds for your goals and timeline and risk tolerance. I can do that for you. I can also rebalance in a tax efficient way, so that you avoid a bunch of extra capital gains taxes from too much buying & selling. If you care about the environment or social justice or diversity in corporate leadership, I can match you with investments that align with your values, sometimes in very simple ways or, for people who are really dedicated, in very complex ways. And I can automate tax-loss harvesting, which is a technique that sells underperforming investments to lock in tax savings and then replaces them with similar investments so that your mix of stocks and bonds stays where you want it.

Those are some of the technical, tactical things I can do for you. But the truth is that there is literally nothing that I know or can do that you couldn’t also learn or do with enough time and research and dedication. Everything I know is available for free on the internet. Every sophisticated trading tool at my disposal, like automated rebalancing or tax-efficient trading or tax-loss harvesting, is available to you somewhere else online for cheap or free.

The only hangup, though, is that you have to put in enough time and research and dedication. And then you have to take action.

So again: you can manage your own investments. But do you want to and are you actually doing it in the best way?

And THAT is the real benefit of working with an investment advisor: I can help you do things and, in fact, do them for you, when you don’t want to or can’t put in the time, research, and dedication. I can make sure that your money is working for you by investing it in alignment with your timeline, goals, and risk tolerance, and that it actually gets done — instead of perpetually remaining on your to-do list.

There are lots of reasons why a person might not want to or might have a hard time managing their own investments. But here are three of the top reasons why the people I work with have decided to offload that responsibility.

1. They don’t want to learn about investing and the stock market and the economy. It’s not interesting to them, it’s not exciting, it’s not fun, and they would rather focus their time & energy on something else. BUT, they also want to know that they are doing the right things with their money while they focus on those other, more interesting and important areas of life. Delegating investment management to a professional solves that problem.

2. It can be confusing and stressful. It doesn’t matter how much information is out there for free; if this stuff stresses you out, the thing holding you back is not lack of information. And there’s so much jargon in the financial services world that only adds to the confusion. BUT, if you can work with someone who understands you and what’s important to you and makes investing seem, if not exciting, then at least within your power, that is a huge benefit. There is so much value in that. Working with an investment advisor solves that problem.

3. Some people are interested in the stock market and the economy, they understand those topics, and they understand what they SHOULD be doing — but they also know they’re not actually doing the right things with their investments. Even though they know what to do, they’re still not doing it. Having all of the information and resources — and even knowing what you should do — is no guarantee that you’ll actually be able to do it. Because money is not just numbers and logic and rational decisions; money is emotional and those decisions are emotional and that’s what prevents a lot of people from taking action. But guess what: I’m not emotional in the same way you are when it comes to your investments. It’s not that I’m heartless or don’t care; on the contrary, I care a lot! I want you to invest for a better future with better options. But I can make the decisions that you find difficult precisely because I’m not you. When the thing holding you back from making good decisions is the emotional weight of those decisions, whether that’s fear or anxiety or just not wanting to screw it up, offloading that responsibility to an investment advisor can help you solve that problem.

So those are three of the most common reasons why people hire me to manage their investments. There are, of course, all of those tactical, technical benefits that I mentioned earlier. But I think the biggest value is that I can help you do things that you don’t want to or — for whatever reason — are not able to do yourself. Using your money to delegate or offload a task that you don’t want to or are not able to do is a good thing. It’s not for everyone, but it might be for you.

Here’s my final takeaway for today: if you like learning about investments and doing the research and building your own portfolio, you can absolutely, 100% do that. The information is there, the technology is there, there is no reason why you can’t do it yourself and save the money you would have paid an investment manager. I support you in that decision — if that’s what you want.

But not everyone feels that way. Not everyone enjoys talking about investments, not everyone gets satisfaction from doing it themselves, and some people find that even knowing what they should do is not enough to actually do it. And there should be zero shame in that. Remember, we pay people all the time to do things we could do ourselves. That’s actually totally normal. If you are one of those people who knows you want to be doing more with your money but — for whatever reason — you’re not actually doing it, then it’s worth having a conversation with an investment advisor.

If you decide to do that, I recommend talking to at least three so you can get a feel for different advisors’ personalities, how they think about investing, and whether you have a good rapport. I’d be happy to be on that list (and you can email me to start a conversation), but you owe it to yourself to talk with a few different advisors for context. There are lots of great advisors out there, but there are also a lot that will give off a bad vibe or just not resonate with you. So take the time to figure out who you trust with that job, because it’s important that you are comfortable in that relationship.

Here’s a pro tip when you’re talking with an investment manager: ask how they get paid. It will tell you a lot about what their motivations are and whether those motivations line up with your best interests. Some advisors still get paid commissions for buying and selling investments for their clients, and that creates a conflict of interest. They are incentivized to do more trading (and therefore earn more money) even if that’s not actually what you need. If an advisor tells you that they are “fee-only”, on the other hand, that means that their only compensation comes directly from you — and not from commissions or kick-backs.

If you want to have a conversation about whether your investments line up with your best vision for the future, hit me up. This email address is always checked by yours truly.

Thanks,

Timothy Iseler, CFP®

Founder & Lead Advisor

Iseler Financial, LLC | Durham NC | (919) 666-7604

Iseler Financial helps creative professionals remove stress while taking control of their financial lives. We'll help identify current your strengths and weaknesses, clarify and refine your long-term goals, and prioritize decisions to improve your financial well-being now and later. Reach out today to take the first step.