Figure Out Your Investor DNA to Make the Best Financial Decisions for Retirement
Retirement savers can be broken down into three different DNA types. Each has a different way of getting things done.


A lot of life advice recommends people “play to their strengths.” Well, the same is true when it comes to investing for retirement. Some people are “do-it-yourself” investors, some are “delegators” and others are somewhere in between. I like to call this a person’s “investor DNA,” because whatever your type, it helps to identify your potential investing strengths and weaknesses.
Understanding your investor DNA is crucial to making the best financial decisions for a successful retirement. If you don’t make decisions based on your DNA, you could cost yourself a lot of money, time and anxiety. I’ve seen people consistently lose out on $150,000 or more by making the wrong choice on Social Security alone.
Take for instance Kyle and Rene who were diligent savers their whole lives and hated the idea of paying someone else anything to manage their retirement investments, so they thought they could be DIYers. However, they were not knowledgeable about investing and thought it was just a necessary means to retirement. They used information they procured online, their Sunday paper and news programs to manage their accounts. Later, after a series of mistakes, they learned that their retirement cash flow was a failure and that without selling their house, they risked outliving their money. They also discovered they would not have enough money to leave anything to their children, something that had been a legacy goal of theirs.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Now that you understand the importance of knowing your investor DNA, let’s start figuring out where you fall.
DIYers
Do-it-yourself investors may enjoy investing for the excitement of it, because they love the complexity and technicality of it, or typically just because they do not want to pay anyone. If you are someone who tends to be very knowledgeable about investing and have a high risk tolerance, you are probably a DIY investor. You may also be a DIY investor if you like to focus on leading-edge products and services and are technically savvy and highly educated.
The other type of DIY investor isn’t necessarily so involved because of their love for investing, but rather their hatred of paying anyone. Some DIYers are extremely frugal and continue to save more than they spend, while living well below their means just to watch their investments grow. They are averse to spending money and especially dislike the idea of paying someone else to manage their investments.
Delegators
Delegators typically prefer to rely on a trusted adviser to help steer their investment decisions. There are a few questions you should ask yourself to figure out if you’re a delegator. Are you interested in the process of investing or wealth management? Are you very knowledgeable about investing? If the answer to these questions is no, you may be a delegator. Here are some further questions to ask yourself to narrow it down: Do you dislike managing finances? Do you feel investing is a necessary means to an end? Are you conservative in your personal and professional life? If you answered yes to at least one of those questions, again, you are likely a delegator.
Some delegators have a strong focus to take care of their families. Others seek the personal freedom that money makes possible, while another group is just afraid of investing and all the technical aspects. Not all delegators are the same, but they all aim to not spend an excessive amount of time building their knowledge of investing. Instead, they rely on guidance from someone else with a high level of experience who can help them achieve their financial goals.
Validators
Validators are the in-between type of investor. Sometimes they hand the keys off to someone else and other times they do the driving. For example, while a delegator may give their entire $2 million portfolio to a wealth adviser to manage, a validator would give a wealth advisor $1 million to manage and manage the other $1 million themselves.
Validators tend to prioritize one of three things — privacy, control or prestige. If they value privacy, they often won’t delegate investment decisions to anyone unless they find someone they truly trust. If they value control, they won’t delegate unless they can still feel like they are in total control of the investment relationship. And if they value prestige, they may look for help in the areas of charitable giving and wealth protection.
What to do with your investor DNA
Once you have a good idea about what your investor DNA is, don’t wait too long to use it as your guide! One study found that Americans spend 7,000% more time watching TV than they do on managing their finances. Purposely take the time to research what is going to be the best option for you.
If you are a delegator and need to hand the keys over to someone else, don’t just hand them to the first person you meet. Interview two to three wealth advisors. If you’re a DIYer, get to work now and spend the time necessary to make a comprehensive retirement investment plan, especially one that covers you pre-deceasing your spouse.
This applies to everyone … don’t wait, as most people do, until you’re less than 12 months out from retirement to create your plan. I’ve seen people cut it this close throughout the 31 years I’ve been in business, and you’ll be infinitely less stressed and more prepared throughout retirement if you are proactive five to 10 years ahead of time. Control what you can control … create your plan in advance in order to live your best life!
This information is prepared by DiNuzzo Wealth Management, and all opinions are the judgment of author P.J. DiNuzzo, as of the date of publication and could be subject to change. This material is provided for educational purposes only and readers should not rely on the content as the only basis for investment or retirement decisions or advice. Always consult with your personal financial advisor and tax advisor before making any financial decisions.
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

P.J. DiNuzzo, CFA, PFS, AIF, MBA, MSTX, is the founder, president and chief investment officer for DiNuzzo Private Wealth Inc./DiNuzzo Wealth Management in Beaver, PA. The firm has been helping pre-retirees and retirees make smart money and best-life choices for 31 years. P.J. is also the author of the book "The Seven Keys to Investing Success."
-
Aging: The Overlooked Risk Factor
Sponsored Elder care is a personal and financial vulnerability many people fail to plan for.
-
AI vs the Stock Market: How Did Alphabet, Nike and Industrial Stocks Perform in June?
AI is a new tool to help investors analyze data, but can it beat the stock market? Here's how a chatbot's stock picks fared in June.
-
Eight Tips From a Financial Caddie: How to Keep Your Retirement on the Fairway
Think of your financial adviser as a golf caddie — giving you the advice you need to nail the retirement course, avoiding financial bunkers and bogeys.
-
Just Sold Your Business? Avoid These Five Hasty Moves
If you've exited your business, financial advice is likely to be flooding in from all quarters. But wait until the dust settles before making any big moves.
-
You Were Planning to Retire This Year: Should You Go Ahead?
If the economic climate is making you doubt whether you should retire this year, these three questions will help you make up your mind.
-
Are You Owed Money Thanks to the SSFA? You Might Need to Do Something to Get It
The Social Security Fairness Act removed restrictions on benefits for people with government pensions. If you're one of them, don't leave money on the table. Here's how you can be proactive in claiming what you're due.
-
From Wills to Wishes: An Expert Guide to Your Estate Planning Playbook
Consider supplementing your traditional legal documents with this essential road map to guide your loved ones through the emotional and logistical details that will follow your loss.
-
Your Home + Your IRA = Your Long-Term Care Solution
If you're worried that long-term care costs will drain your retirement savings, consider a personalized retirement plan that could solve your problem.
-
I'm a Financial Planner: Retirees Should Never Do These Four Things in a Recession
Recessions are scary business, especially for retirees. They can scare even the most prepared folks into making bad moves — like these.
-
A Retirement Planner's Advice for Taking the Guesswork Out of Income Planning
Once you've saved for retirement, you'll need your nest egg to support you for as many as 30 years. For that, you need a clear income strategy, not guesswork.