Before I was married, I didn’t consider my failure to manage even basic hand tools a feminist inadequacy. I thought it had more to do with being Jewish. The Jews I knew growing up didn’t do “do-it-yourself.” When my father needed to hammer something, he generally used his shoe, and the only real tool he owned was a pair of needle-nose pliers. – Ayelet WaldmanI recently met with a not-so-recent widower whose wife had taken care of the finances throughout their marriage. He wanted to know if he had enough money to both retire within the next four years, as well as marry off his three children and help them buy apartments. He told me that he hates dealing with numbers, has a hard time understanding financial basics and has no knowledge about investing.He then told me that his brother told him that investing is easy and that he should open an account with an online broker like Etrade or TD Ameritrade, and wanted my opinion. Before giving my opinion I said I need some more information.Investigate expensesAs he wants to know about retiring sooner rather than later, I started asking about his monthly and annual spending. He told me that he has no idea what he spends, but gave me a ballpark number between 20-30,000 shekel a month, but then said he also gets gifts annually from his parents which he also spends. He based his estimation on his salary and said that he usually finishes the month in plus, unless he doesn’t and finishes in minus!InvestmentsIt turns out that he has quite a bit of savings. He received an insurance payout when his wife passed away. About 20% of the money was in very conservative mutual funds, which she had bought, and the rest of the money was sitting in a US bank account earning zero interest. I asked why after a few years he never did anything with the cash, and he said that he has no knowledge about investing and he was scared to make any decisions.It’s a snapI then proceeded to give him my opinion of his becoming a do-it-yourself investor, which in this case you can assume was an emphatic “very bad idea.” I asked how he would even go about choosing investments and he said his brother sent him an article an article from the LA Times that explains how he should invest. Then we spoke about how he would invest, knowing that he has certain specific goals and needs, and he had no answer. As he began to understand that his idea wasn’t so great, he asked what the next step would be if he worked with me.ConsolidationMy suggestion was to consolidate the mutual funds and cash into one place, and then to create an investment plan that will help him achieve his goal of retirement and helping out his kids. Then he asked what that would cost, and when I told him, he balked. He said that his brother told him that these online brokers dropped their commissions to zero and that paying an adviser is a waste of money.Performance costWhat he failed to grasp was that while working with a financial adviser meant that he would have to pay some fees, he could solve all of the problems that were specified at the beginning. It’s crystal clear that he’s unable to manage his finances efficiently, and that an adviser would help him both to get organized and meet his goals.Numerous studies have shown that “do-it-yourself” investors tend to underperform the market by about 4% a year, and they end up paying out high sums in unnecessary taxes as well. Therefore, although it may seem cheaper for an investor to handle his investments himself, he may find that over the long term he will cost himself hundreds of thousands of dollars.A word to the wiseWith all the free financial advice and information readily available, it becomes very easy for individuals to think that they can create their own portfolios and manage them on an ongoing basis. And for those who are truly able to do so, it may make sense. However, we should ask ourselves whether we really think that our understanding of profitable portfolio allocation at a lower risk is equal to that of a professional adviser. If the answer is no, find yourself an adviser as soon as possible. Don’t think that you will be making money by saving a few dollars in commissions. For most investors, that particular saving is only short-lived. The cost that you may pay in underperformance and tax-inefficiency could be far more.The information contained in this article reflects the opinion of the author and not necessarily the opinion of Portfolio Resources Group, Inc., or its affiliates.Aaron Katsman is author of the book Retirement GPS: How to Navigate Your Way to A Secure Financial Future with Global Investing (McGraw-Hill), and is a licensed financial professional both in the United States and Israel, and helps people who open investment accounts in the United States. Securities are offered through Portfolio Resources Group, Inc. (www.prginc.net). Member FINRA, SIPC, MSRB, FSI. For more information, call (02) 624-0995 visit www.aaronkatsman.com or email firstname.lastname@example.org.