Quora Answer: Can You Manage Your Own Investments & Perform as Well as a Financial Consultant?

The following is my answer to a Quora question: “Do you think you can manage your own investments, and make as much money as a professional financial consultant?” 

Yes, I can. And that is solely because I am a professional financial consultant.  In all seriousness, though, it is possible to manage your own investments, and it is possible to do better than a professional financial consultant.  A financial consultant is just that – an advisor.  A good financial consultant is supposed to provide you a perspective on your portfolio that you might miss.  You cannot manage your entire portfolio by yourself, especially when it is extensive.  That is why the wealthiest people have financial consultants. 

You could be a great mechanic.  That does not mean you want to fix your car, or check it, unless that is your hobby.  The mechanic would have access to tools you might not have.  He has access to the expertise of other people who deal with similar models and with the manufacturer for their guideline.  In the same vein, a financial consultant belongs to a financial institution with all the resources of that institution specific to the industry.  This includes market outlook, and fund updates that you will not get before them unless you are willing to pay the money to subscribe to these services. 

If your investment strategy is not active management, however, and involves taking a position on an index fund, over an extended investment horizon, with little active management, and fund movement in the interim, you do not need any of that.  There is a wealth of information online that you can find online for your research.  There are forums and groups.  But it will be a steep learning curve, and it may be an expensive lesson.