Goal of This Paper cR Time inconsistent preference generates a liquidit shortage for the investor who invests on his own c& Financial intermediaries make investments on behalf of the investors and provide liquidity for unsophisticated investors sR The financial intermediaries in our model can be interpreted as banks, pension funds, mutual funds etc  Time inconsistent preference generates a liquidity shortage for the investor who invests on his own  Financial intermediaries make investments on behalf of the investors and provide liquidity for unsophisticated investors  The financial intermediaries in our model can be interpreted as banks, pension funds, mutual funds, etc. Goal of This Paper