Is do-it-yourself financial planning for expats a good idea?


In recent years, it has become a trend that the masses mistrust experts. Instead, many of us decide to face life's challenges on our own, because we all know that Google can diagnose health symptoms and watching a short YouTube video can help you set up a new shower!

But if you're thinking about your wealth management and retirement planning, and are in doubt about hiring a professional to help you plan and manage your money, is this a wise approach? What is involved in a do-it-yourself financial planning, and does it suit your expat lifestyle?

Are you suitable for do-it-yourself (DIY) wealth management?

When it comes to financial planning, a do-it-yourself approach comes with a host of ongoing responsibilities. To perform the required tasks, you must ensure that you have not only the necessary knowledge, expertise and practical skills, but also the time, organisation and emotional resilience that are inseparable from the investment process.

There are five key criteria that are essential for DIY financial planning:

  1. You must love the investment process and be so passionate about investment strategies that financial pursuits already take up a lot of your free time. If the reading next to your bed is books on economic theory, if you enjoy a full breakfast with the Financial Times, and if you consider attending an investment seminar a relaxing break, you may be in a position to build your own net worth.
  2. Another important qualification for the DIY expat financial planner is the ability to make decisions about your financial future in a comfortable way. This means you shouldn't feel overwhelmed by the process and the high stakes, and this responsibility shouldn't cause you to lose sleep at night.
  3. You must have a lot of time and would rather spend time optimising your investment portfolio than play golf or hang out with grandchildren. It sounds harsh, but it's true. Good investment decisions require research, planning and accuracy.
  4. You must be able to withstand market volatility without making hasty decisions. Investment portfolios inevitably lose and gain in value during times of economic instability, and you must be able to withstand peaks and loss in the value of your assets and investments without making hasty sell offs or purchases.
  5. Can you keep your eyes on the long term? It's easy for the self-investor to tap into savings accounts, pensions, and other assets without fully realising how it could affect future returns. Budgeting and time horizon planning are essential in this regard.

Is a Robo Investing a Good Alternative?

Robo-advisors may seem like the perfect middle ground between DIY investing and working with a financial advisor. In reality, however, most investment platforms are little more than glorified algorithms that take some measure of your risk tolerance and objectives after a short questionnaire before grafting your funds into a pre-built portfolio.

They are not personalised, cannot talk to you, cannot listen to you and cannot help you stay disciplined in times of volatility. A professional financial advisor, on the other hand, will build a relationship with you and integrate your finances, tax considerations and estate plans, while also taking into account all of the unique cross-border issues associated with living as an expat.

Finally, robo-advisors may not know - or care - whether you have health problems, a grandchild with special educational needs, or are wondering about the financial implications of a divorce; a human advisor can make an invaluable difference when you need expert, tailored advice most.

Tried and tested expertise to represent your interests

expatwealthatwork has almost three decades of experience in representing expat clients' financial interests. We can help you weather the financial uncertainties and impacts of tough times, so you can rest assured that your money will continue to work for you.

We believe there are many challenges for expats- both emotionally and practically - for DIY money management to be a sensible option. To learn more about our services and expertise, speak to us today: