The Truth About DIY Investing (From Someone Who’s Seen It All)

I’ve worked with hundreds of clients over the years, and spoken with even more people who were trying to figure it all out on their own.

And listen, I get the appeal of DIY investing. It feels smart. It feels empowered. You’ve got the apps. You’ve read the blogs. You’ve seen the YouTube videos (hopefully not just the ones selling gold bars and crypto coins).

But here’s the thing: doing it yourself doesn’t always mean doing it well.

In fact, in my experience, DIY investing often costs people more than they think. Not just in returns, but in time, stress and missed opportunities.

So, if you’re going it alone or considering it, let me walk you through five common mistakes I see DIY investors make and how to avoid them.

1. Following the herd

There’s never been more financial “content” out there. That’s both a blessing and a curse.

Just because someone’s YouTube channel has flashy graphics and 200,000 followers doesn’t mean their advice is right for you. A lot of it is hype. Some of it is outright dangerous (I’m looking at you, pump-and-dump crypto bros).

I’ve seen people invest their hard-earned savings based on someone yelling “this is the next Amazon!” on TikTok. That’s not investing. That’s gambling.

When you’re getting information online, make sure it's backed by real, objective research, not just clicks and charisma.

2. Trying to time the market

Ah yes, market timing… the siren song of the DIY investor.

“I’ll just wait until the market dips.”
“I think it’s about to crash, so I’m staying in cash.”
“I’ll get back in when things settle down.”

Sound familiar?

Here's what I always remind clients: missing just a few of the market’s best days can devastate your long-term returns. And guess what? Those "best days" often come right after the worst ones, when many DIY investors are still sitting on the sidelines.

JP Morgan Asset Management using data from Bloomberg. Returns are based on the S&P 500 Total Return Index, an unmanaged, capitalization-weighted index that measures the performance of 500 large capitalization domestic stocks representing all major industries. Indices do not include fees or operating expenses and are not available for actual investment. The hypothetical performance calculations are shown for illustrative purposes only and are not meant to be representative of actual results while investing over the time periods shown. The hypothetical performance calculations are shown gross of fees. If fees were included, returns would be lower. Hypothetical performance returns reflect the reinvestment of all dividends. The hypothetical performance results have certain inherent limitations. Unlike an actual performance record, they do not reflect actual trading, liquidity constraints, fees and other costs. Also, since the trades have not actually been executed, the results may have under- or overcompensated for the impact of certain market factors such as lack of liquidity. Simulated trading programs in general are also subject to the fact that they are designed with the benefit of hindsight. Returns will fluctuate and an investment upon redemption may be worth more or less than its original value. Past performance is not indicative of future returns. An individual cannot invest directly in an index. Data as of June 30, 2025.

In April 2025, when tariff news tanked the market, DIY investors who bailed felt pretty smart. That is, until the market reversed course and they missed the rally.

It's not about perfect timing. It’s about staying invested with a strategy.

3. Not diversifying enough

This one’s sneaky, especially if you’ve had a few winners.

I’ve seen people pour everything into a couple of high-flying stocks and then wonder why they’re experiencing wild swings (or losses) when things turn.

Diversification isn’t exciting, but it’s essential. It spreads your risk across different sectors, asset classes and markets. It’s what smooths the ride so one bad call doesn’t derail your entire plan.

Remember: in 2023, just 10 companies drove over 85% of the S&P 500’s total return. That’s concentration risk hiding in a diversified index!

4. Forgetting to take gains (or rebalance)

Here’s a classic: You buy something. It goes up. You feel great. You hold. It keeps going. You feel like a genius.

Then… it crashes.

I’m not saying you should panic-sell every winner, but discipline matters, especially when it comes to rebalancing.

Holding on to a single stock too long can leave your portfolio dangerously lopsided.

Rebalancing your investment portfolio can offer several key benefits, such as effective risk management, enhanced long-term returns and the discipline to avoid emotional decision-making. By regularly adjusting your investments back to their target asset allocation, you ensure your portfolio remains aligned with your financial goals. 

5. Losing patience

We live in a world of instant gratification. But investing doesn’t work that way.

It takes time. And sometimes, it takes sitting through volatility without flinching.

DIY investors often abandon ship too early, chasing the next hot thing or reacting emotionally to short-term news. But the truth is, slow and steady tends to win the race, especially in retirement investing.

Final thoughts

Look, DIY investing isn’t always a bad idea. But it’s not as easy as some apps and influencers make it look.

And if you're juggling a busy life, navigating a complex retirement plan, or just tired of guessing… it might be time for some guidance.

I cover more of this in my video “Risks and Rewards of DIY Investing” over on Advance Capital Management’s YouTube channel.

Check it out – and if you want more personalized guidance, schedule a portfolio review!