Understanding self-directed vs. guided investing: What credit unions need to know

As the financial landscape evolves, it’s clear that today’s investors are not a monolith—they approach wealth-building with diverse preferences and strategies.

For credit unions, understanding these approaches is not just about staying relevant, it’s about empowering members to reach their financial goals through tailored resources and solutions.

Two primary investment styles dominate this conversation: self-directed investing, where individuals maintain full control over their portfolios, and guided investing, where professional advisors or automated systems provide structured oversight and expertise.

This article will explore self-directed and guided investing, in addition to outlining how credit unions can adapt to this evolving landscape and thrive.

Self-directed investing has revolutionized the relationship between investors and financial institutions. Fueled by technology, the rise of third-party investing platforms such as Robinhood has made it easier than ever to start investing. Investors can make trades, and track their portfolios from their phones, bypassing many traditional processes.

This democratization has led to remarkable participation growth. Robinhood alone reported over 25 million funded accounts and $204 billion in assets under custody as of early 2025. These numbers highlight the significant influence of self-directed investing and the asset flows reshaping financial markets.

However, with opportunity comes complexity. A lack of proper investment education and emotional decision-making pose a serious risk to investors. Credit unions must recognize that self-directed investing doesn’t mean investors should be left alone. Bridging autonomy with financial education is essential for mitigating risks while sustaining empowerment.

Guided investing remains critical, particularly for members seeking financial guidance amid uncertainty or complexity. Just six months after launching its robo-advisory tool Robinhood hit $1 billion in assets under management.

With guided investing, investors lean on expertise, whether through human advisors, robo-advisors, or a combination of both, to craft portfolios aligned with their goals, risk tolerance, and life stage. These services provide confidence, particularly in navigating market volatility or longer-term planning like retirement and estate management.

For some members, trusting their investments to a guided investing tool or structured system is not just a matter of convenience; it’s a necessity given their limited time, financial literacy, or goals. For credit unions, offering these services can build trust, foster member loyalty, and provide consistent revenue streams linked to AUM fees.

Within this dynamic sphere, a key demographic is emerging—the hybrid investor.

Hybrid investors, who seek both autonomy in their investment choices and guided oversight, represent a growing segment whose needs are reshaping the investment landscape. To effectively cater to this diverse investor base, embracing both self-directed investing and guided investing models is not just advantageous, it is imperative.

Credit unions are uniquely positioned to thrive in today’s evolving financial landscape, leveraging their foundational strengths of trust, collaboration, and member-first engagement. These institutions operate within a culture built on mutual benefit, prioritizing outcomes that align with members’ goals rather than focusing solely on profit. To maximize impact, credit unions must ensure their offerings address the two following key member priorities:

The next generation of wealth management hinges on seamless integration. Credit unions can deliver a cutting-edge member experience by offering both self-directed and guided investment services through their digital ecosystems. This synergy provides members with the flexibility to choose a path that suits their individualized financial goals. By directly integrating these tools, your credit union can also benefit greatly. With this service offering, you can attract new members and retain new ones.

Empowering members with knowledge is central to the mission of credit unions. A well-informed member base fosters trust, engagement, and long-term loyalty. By offering accessible educational resources, such as webinars, on-demand tutorials, community workshops, and intuitive digital tools, credit unions can demystify investing for members at every level of experience. Proactive education not only differentiates credit unions from competitors but also positions them as trusted partners.

Investing has never been more accessible. But, accessibility without support can lead to instability. For credit unions, the challenge isn’t competing with standalone investment platforms, but creating something more holistic. The winners will be the credit unions that respect both self-directed and guided investing behaviors equally, giving every investor the tools, insights, and trust they need to grow.

At InvestiFi, we understand these complexities and work alongside credit unions to craft solutions that adapt to the changing financial landscape. By staying ahead of member trends and embracing opportunities for growth, credit unions can secure their position as trusted financial leaders for the future. Visit InvestiFi's website to download an overview and learn more.