Self-Directed or Advised Portfolio: Compare Service and Cost
Define the decisions you want to delegate, then compare platform, fund and advice fees on that basis.
Published 2026-07-21
Between full self-direction, an online portfolio service and private management, the cost gap runs from 0.25% to over 1% a year; the service gap measures poorly on a rate card. The method of choice starts from the decisions you genuinely want to delegate: the rebalancing postponed for two years, tax placement across accounts, and above all discipline in a falling market, for anyone who has already sold at a bottom. Each price tier buys a different level of delegation, and paying for unused services is worth exactly what a forgotten subscription costs. Contact frequency, access to a person and responsibility for each task get clarified in writing before signing. This article inventories what each formula does and does not do, prices the gaps on a typical portfolio and identifies the life moments when the answer changes — because the right tier at forty is rarely the right tier at sixty-five.
List what you genuinely want to delegate
The choice among self-direction, an online service and private management starts with a personal inventory: the decisions you genuinely want to hand to someone else. The typical list: rebalancing, mechanical yet indefinitely postponed by many self-directed investors; tax placement across accounts, what lives where; investment selection; and bear-market discipline, the most precious for anyone who has already sold at a bottom. Every undelegated task returns to you, with its demands of time and consistency. The honest inventory, grounded in the actual record rather than intentions, sketches the necessary service level: some people need nobody, others need everything, and most sit somewhere precise in between.
Price the three cost tiers
The three formulas stack in total annual cost, all-in. Full self-direction: the held ETFs' fees plus the platform's commissions, often around a quarter point. The online portfolio service: algorithmic management, rebalancing included, around half to three quarters of a point, fund fees counted. Private management or full-service advice: a point or more, planning and guidance included. On your real balance, these percentages become annual dollars, and the gap between tiers is compared with each one's additional services: the gap between self-direction and the online service buys automatic rebalancing and discipline; the next gap buys a person, their planning and their availability.
Verify the promised service's reality
At an equal price tier, offers diverge on substance, which gets verified before signing. Contact frequency first: an annual meeting, quarterly reviews, contact as needed? Access next: a dedicated person who knows the file, a rotating team, a call centre? Availability at the critical moment above all: who answers during a market correction, and how fast? These questions, asked before enrolling, receive contractual or evasive answers — information in itself. The advisor's compensation gets asked about too — salary, commissions, fees — because it steers the recommendations. The real service is finally judged in use: a year in, the kept promises get counted, and the gap between what was sold and what was delivered justifies a renegotiation or a departure.
Assign every responsibility in writing
Mixed arrangements and grey zones cause the quietest losses: each party believes the other rebalances, nobody does; cross-account tax placement belongs to no one; cash sits unassigned. The remedy: one page assigning each task — rebalancing, tax, plan review, fee monitoring — to a named owner, you or the service, with its frequency. Self-directed, everything falls to you and the page becomes your routine; with an online service, the algorithms cover the mechanics and you keep the overall tax picture; in private management, the page becomes the list of contractual expectations. The page's annual review, ten minutes, catches orphaned tasks before they cost — and life stages, an inheritance, approaching retirement, reopen the question of the tier itself. Revisit it yearly.
Quebec scenario: compare before confirming
At 45, a school principal in Victoriaville receives a private-management offer at 1.3% a year and wonders what she already pays and what she would get in exchange. She starts by inventorying her three real options: continuing alone on her brokerage platform, roughly 0.25% all-in between ETF fees and commissions; an online portfolio service at 0.7% with automatic rebalancing; private management at 1.3% with a dedicated planner. Then she lists the decisions she genuinely wants to delegate: rebalancing, which she has postponed for two years; tax placement across her four accounts; and above all the calm voice on the phone when markets fall, she who sold at the bottom in 2020. The frequency of contact matters too: one annual meeting is not worth 1.3% to her; direct access at any time, perhaps. She picks the online service, halfway on both cost and delegation, and writes the condition for a future change into her file: the day her situation demands real tax and estate planning, 1.3% could become an honest price again. The offer letter stays in the file, annotated rather than discarded.
Checklist
- List the decisions to genuinely delegate
- Price each formula's annual cost
- Verify the offered contact frequency
- Assess access to a person in a crisis
- Review your own bear-market behaviour
- Clarify in writing who does what
- Avoid paying for unused services
- Choose the tier aligned with real needs
- Revisit the choice at life stages
Frequently asked questions
How do I choose between self-directed, online and private management?
First list the decisions you genuinely want to delegate: rebalancing, tax placement, discipline in a downturn. Each cost tier, from 0.25% to over 1%, buys a different level of delegation. The right choice covers your real needs without paying for the rest.
What is access to a person worth in a crisis?
A lot, if your history justifies it: the investor who once sold at the bottom pays less for advice than for the next panic. Verify the actual contact frequency and availability between meetings: one annual meeting and continuous access are not worth the same price.
Who stays responsible for what in each formula?
Clarify it in writing: who rebalances, who optimizes tax across accounts, who watches the fees. Self-directed, everything falls to you; online, algorithms cover the mechanics; in private management, the person is paid for the whole. Grey zones cost dearly precisely because they get discovered late.